It doesn't matter that you have a co-signer.
There is no specific tax advantage to
purchasing a new personal use auto. There are some potential benefits,
however. They include:
- Personal property taxes are deductible
on your taxes if your state imposes one. A personal property tax is
an annual tax based on value. In some states they are part of your
annual registration, in other states they are billed separately by the
county (as in South Carolina) and in other states there is no personal
property tax on automobiles (as in Florida which taxes autos based on
weight, not value.)
- Sales tax paid may be deductible, but
this is usually only a benefit in states that do not have a state income
tax as only the higher of the two is deductible.
- If it’s an all-electric or plug-in
hybrid vehicle it may be eligible for an energy tax credit.
Interest on a personal auto is not
deductible. Personal property taxes and
sales taxes are only deductible if it is to your advantage to itemize
deductions (i.e., your itemized deductions are greater than your standard
deduction.)
In
Turbotax,
- For
personal property taxes select Cars and Other Things you Own, then
Personal Property Taxes.
- For
energy credits on vehicles select Cars and Other Things you Own,
then Energy-Efficient Vehicles
- For
sales taxes, select Estimates and Other Taxes Paid, then select
Sales Tax.
