I sold my old car and traded-in for new car for personal use last year, can I deduct sales tax on turbotax ?

[edwardsun007]

Hello everyone.

I sold my old car last year and traded-in at the dealership for buying the new car for personal use, can I deduct sales tax on turbotax ?
If so,  how should I do this ?

[SharonD007]

It depends. Sales tax is deducted on Schedule A when you itemize your deductions.  You have the option of deducting sales tax or State and Local Taxes (SALT).  The most that you can deduct is $40,000 ($20,000 if you are filing as Married Filing Separately). 

You must have more itemized deductions than the Standard Deduction for your filing status to deduct.

Review the following TurboTax articles to determine if there are additional items that you can deduct on your Schedule A.  20 Common Tax Deductions: Examples for Your Next Tax Return, What Are Itemized Tax Deductions?, and Standard Deduction vs. Itemized Deductions: Which Is Better?

For instructions to enter your sales tax, review the TurboTax Help article Where do I enter my sales taxes paid?

For more information, review the TurboTax article How to Write Off Sales Taxes.

[Edited 03/23/26| 12:45am PST]

@edwardsun007

[NCperson]

@SharonD007 the question was about sales tax - not interest loan deduction under OBBBA.

the sales tax is generally deductible if you itemize, if you take the standard dedcution, then no, you can't deduct the sales tax.