Vehicle Registration Fees

[bgrafflin]

My Vehicle Registration Fee was entered and shows in "Cars and Other Things You Own" and on the "Enter your car registration fees" page but doesn't show on the Summary page of Deductions and Credits (it reads "0"). Why is that?

[MonikaK1]

It depends. 

If the total of all of your state taxes exceeds $10,000, entering more won't increase the deduction. Revisit the "Cars and Other Things You Own" section and click through to the last screen to see whether this explanation appears: "You have now maxed out the federal $10,000 deduction for itemized state and local taxes. Any entries over the $10,000 limit won't impact your federal tax outcome, but may still benefit you on your state tax return. We'll include them automatically if this applies to you."

Also, your car registration is deductible if it’s a yearly fee based on the value of your vehicle and you itemize your deductions.  If you take the standard deduction (most people do), you will not see a tax deduction for this fee.  If you do itemize, you will see it as part of your property tax deductions on Schedule A.  

You can’t deduct the total amount you paid, only the portion of the fee that’s based on your vehicle’s value.  And, not all states have value-based registration fees. The states that do are listed below along with the deductible portion of your registration fee.

States with deductible car registration fees and which portion you're allowed to claim

States where you claim personal property tax in lieu of vehicle registration fees

Where you can find your car registration fees:

You can preview your return before filing to find out how your taxes were calculated. See here for details. 

[bgrafflin]

Thanks. That answers it.

[DSE1]

I entered in the Colorado vehicle registration tax ownership in TT, but got no message that we maxed out on deductions.  We're taking the standard deduction (and we did last year too).  Last year, the summary shows the standard deduction AND the vehicle registration fee.  This year, the summary shows the standard deduction and the vehicle registration fee is $0.  Why?

[AbrahamT]

It would only be deductible if you itemized. You would enter the amount either in the registration fee section or property tax section,Deductions and Credits, Cars and other Things you Own. See HERE