Sales Tax Deductions

[mek2197]

Regarding itemization and sales tax, I typically put a place holder estimating before I create my spreadsheet to get the accurate total before filing my taxes.  Once I was complete with my spreadsheet (inputting one receipt at a time), I was well under my estimate mainly because I purchased a new car and other items.... Christmas etc..   In the past my refund would go up or down depending on the amount inputted regardless if I took TurboTax's estimate. This year the amount did not change.... regardless of what number I used.  

Is sales tax capped based on AGI? Why would the total refund not adjust with different sales tax amounts?  I even continued the process of filing my taxes and still no change thinking it would update at the end.  

I would hate to lose itemizing a few thousand dollars of sales tax.  I live in Texas. 6.25%

Thanks in advance! Mark

[KrisD15]

It could be the SALT limit (State And Local Tax) of 10,000. 

Texas property taxes are pretty high, so if you reported those first and hit the 10,000, adding additional sales tax paid won't change your bottom line. 

TurboTax explains SALT limit

[mek2197]

My property taxes did hit over $10k (by $400) so you are saying once I hit that cap, the sales tax is not applicable to be itemized anymore?

Would make sense....

Thank you for answering. 

[KrisD15 · Accepted solution]

That is correct. 

Some Taxpayers try to push the taxes to alternate years, much like charitable contributions and take the Standard Deduction on the years the tax payments are light. 

You can pay (and deduct) the property tax in the earlier year IF the tax has been billed. 

Thank you for using TurboTax. 

[1Sandi2009]

I am interested in sales tax deductions on my leased 2020 vehicle. I have not beed able to get an answer from

anyone in three days. I did it on my 2019 vehicle. The rules say ztismdoable but no-one set to know where.

[DaveF1006]

Sales tax deductions are only claimed in the first year you bought your car. From then on, these are not claimed yearly and are not amortizable. 

if you are self-employed, you can write off lease payments for your car if you claim actual expenses but you cannot claim a yearly sales tax deduction.