Can I deduct sales tax on used car purchase?

[exechef]

I traded a vehicle used for business in May 2011. Can i deduct sales taxes paid on purchase?

[bwa]

Yes, if you qualify.

If you claim the standard deduction, you cannot.  The legislation that permitted a deduction of sales taxes on a new auto in addition to the standard deduction was only for new vehicles purchased from Feb. 17, 2009, through Dec. 31, 2009.  It was not part of the "Bush Tax Cuts" and, consequently, when those cuts got extended they did not include extending this provision.  See http://www.irs.gov/newsroom/article/0,,id=204519,00.html for the dates.

If you claim itemized deductions for sales taxes, you can add the sales tax on a vehicle to the amount on the Commissioner's sales tax tables.  The following is from Turbotax's input screen under Sales Tax:

"You can deduct the sales tax on certain major purchases . . ." If you click on the "certain major purchases" link, you will see an explanation of what they are.  The list includes:

--- Vehicles,
--- Boats,
--- Motor Homes
--- Building materials for major home improvements."

However, itemized deductions for sales taxes are only to your advantage if your sales tax deductions are more than your state income tax deductions (as you can only claim one or the other.)

[g2527uk]

Where is this "certain major purchase" link? Thanks.

[bwa]

It should come up as part of the sales tax interview.  If you are using the desktop version, type sales tax in the search box.

[Jsommer]

what if we bought a car in Oct. of 2010... but didnt deduct the sales tax in the 2010 taxes (didnt realize you could do that!)....can i claim it on my 2011 taxes?

[RCalixto]

How can i get a tax deduction on a car a bought in 2011