Can I deduct taxes on used car purchase that I made in 2017 when I file taxes?
No. You cannot deduct sales tax on a used car. However, you can deduct state and local sales and excise taxes you paid on the purchase of a new:
- Light truck
- Motor home
- Off-road vehicle
The deduction is currently available on new vehicles bought in 2017. If the sales tax on these types of vehicles is higher than the general sales tax rate, you can only deduct sales tax up to the general sales tax rate. You can deduct either of these:
- State and local sales taxes, including those paid on these:
- New vehicle
- Home improvements
- State and local income taxes
However, you can’t deduct both.
If you deduct sales taxes, you can either:
- Save sales receipts and deduct actual sales taxes paid.
- Use the IRS’s sales tax tables to figure the deduction. You can find the tables in the Form 1040 instructions or use the IRS calculator.
Do you need to report non-deductible expenses from Schedule K-1 on your taxes? Learn more from the tax experts at H&R Block.
Find out more about the gross cap on medical expenses with help from the tax experts at H&R Block.
Learn whether social security disability is considered taxable income with advice from the tax experts at H&R Block.
Do you know which documents you need to claim business expenses? Learn more from the tax experts at H&R Block.