Question

If I bought a used vehicle this year. Are there any used car tax deductions available?

Answer

 

There are not used car tax deductions available. If you choose to take the standard deduction you cannot deduct the tax. However, if you itemize your return you may be able to deduct the sales tax you paid on the vehicle. In order to do so you can only deduct state and local sales taxes instead of income taxes on Form 1040, Schedule A.

You can deduct the tax you pay on personal property — like cars and boats. Personal property tax — also called an excise tax — is based on the value of the item.

To deduct property taxes, all of these must apply:

The tax is imposed on personal property.

The tax must be based on the value of the personal property

The tax is imposed on an annual basis, even if collected more or less than once per year.

Because you will be excluded from taking the standard deduction if you choose to deduct the tax you paid on personal property you should calculate both methods – the standard deduction or itemization – to determine which is best for you.

 

Related Topics

Related Resources

My partnership Schedule K-1 shows a small amount for non-deductible expenses. Can I report these non-deductible expenses

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.

If I accidentally claimed the wrong allowance amount on my W-4. What will happen?

What to do if you accidentally claimed the wrong allowance amount on your W-4. Learn more from the tax experts at H&R Block.

I’m a full-time graduate student. What grad student tax deductions for out of pocket education tuition and fees am I eli

Learn more tax deductions available to grad students with advice from the tax experts at H&R Block.

Can I deduct taxes on used car purchase that I made in 2017 when I file taxes?

Learn whether you can deduct sales tax on the purchase of a used car with help from the tax experts at H&R Block.