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.
Looking for virtual tax help with your online filing? Learn more about your options by comparing TurboTax Live to H&R Block Tax Pro Review and Tax Pro Go.
The startup tax or new business tax is a topic many new business owners shy away from. Don't get caught off-guard. Review these tips provided by our tax pros.
Trying to determine the cost of tax preparation or H&R Block’s prices? Find out why there is no one-size-fits-all answer when it comes to tax prep.
Are Veterans benefits taxable? Our H&R Tax Professionals address your veteran's related tax questions in honor of our soldiers this Veteran's Day.