2010 Sales Tax

Today TaxMama hears from Brian in the TaxQuips Forum with a good question.
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  “I bought a new 2010 personal car in 2010.

Is the car sales tax deductible on 2010 taxes?”

Hi Brian,

 Don’t you just love that new car smell – and that fresh, sparkly warranty?

 The best place to look for the answer to your question is the most current version of the 2010 Schedule L.  Right there, on Line 9 is a place to enter the sales tax on new motor vehicles.

Uh oh! What the instructions say is to pick up the sales and use tax paid in 2010 on vehicles you purchased after February 16, 2009, and before January 1, 2010.


 Why would you be paying sales taxes in the subsequent year?
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Aaaahhhh. You bought the vehicle in 2009 in a different state with either no sales taxes, or lower sales taxes than in your state.  Then, when you filed your state tax return for 2010, you paid use taxes to your state!

OK, now I understand.

Oh well, I guess if you paid all the sales tax on your car in 2009, there is no deduction on the 2010 tax return. Or if you bought the car in 2010, there is no deduction. Alas. Sorry!

And remember, you can find answers to all kinds of questions about new tax laws, and other tax issues, free.

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3 thoughts on “2010 Sales Tax

  1. Pingback: Property Tax For NonItemizers | taxquips | taxmama

  2. TaxMama says:

    Hi Kathy,

    Schedule L is only for people who don’t itemize.
    Folks who itemize can still use the sales tax deduction, along with the sales tax tables
    OR their state income tax.

    Thanks for reminding me to add that.



  3. Kathy Hartle says:

    This is not how I understand it, so lets talk about it please. I know that the credit for purchasing a new vehicle and the ability to deduct it on Schedule L is gone, but if you still itemize deductions, you can add the sales tax paid on a new car purchase with your other sales tax paid for 2010. I believe the tax extenders are still allowing it. Let me know if I am wrong before I start tax season.

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