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Sales tax that you remit to city and county offices for your small business are not reported on your federal income tax return. The amount of sales tax you may be able to deduct is sales tax paid on your personal purchases and is separate from your business.
On your federal return, if you itemize, you can elect to take a sales tax deduction. Individuals can deduct either state and local income taxes or sales taxes paid during the year. In other words, taxpayers will need to choose between these two deductions. Generally speaking, the deduction works best for people who live in a state with no income tax, or whose sales tax deduction is larger than their state income tax deduction.
Since you reside in AL, you could choose whichever is the larger deduction, if you itemize your deductions.
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