Specific item sales tax deduction

[smc2024]

The Specific Item Deduction (column 😎 for a motor vehicle purchase is less than the Actual Sales Tax Amount Paid (column 7) on the Tax and Interest Deduction Worksheet. I thought the entire amount of the actual sales tax would be deductible. What would cause the Specific Item Deduction to be less than the Actual Sales Tax Paid?

[MaryK4]

If you paid sales tax on a car at a rate higher than the general sales tax rate for your area, you can deduct only the amount of the tax that you would have paid at the general sales tax rate on that vehicle.  This usually happens if you purchase the car in a city/county/state that has a higher sales tax rate than your home.  

[smc2024]

In this case, the sales tax on motor vehicles is 6%, while the combined state and local sales tax in my area is 7%. So the sales tax paid on the vehicle was less than the combined state + local sales tax.

[KrisD15]

I tested this in the software and never had the sales tax reduced on any item as long as the tax rate charged on the item was at or below the state sales tax rate. 

I would ask you to double-check your entries and make sure that the Actual Sales Tax Amount in Column 7 is the cost times the rate that you entered. 

Also please check what you reported as your state and local tax combined. 

Attached is an example where I listed cost at 100,000 and the rate at 7% but also entered sales tax paid of 9,000. 9,000 is more than 7%, so it was reduced. Do you think that the tax you reported included other fees such as Dealer Prep? Or do you think the rate you listed was incorrect and they really charged a higher rate? 

@smc2024

IRS Sales Tax Calculator 

According to the IRS:

“Alternatively, you can elect to deduct state and local general sales taxes. A general sales tax is a tax imposed at one rate on retail sales of a broad range of items. A taxpayer makes the election by checking box 5a on Schedule A of Form 1040. If you elect to deduct state and local general sales taxes, you can use either your actual expenses or the optional sales tax tables”

[Edited 02/14/2025 I 4:37pm PST]