Deducting Sales Taxes

Today TaxMama hears from Ernie in Kentucky, with this question. “Do taxes charged on utility bills, ie: state, local, school, local 911 charge, qualify for a deduction on 1040 Schedule A?”

Dear Ernie,

That’s a good question. And it’s really nice to know that you have enough time to dig through every one of your utility and phone bills to locate every deduction.

If those taxes were deductible, I’d be very impressed with you.

But remember, this is a ‘sales tax’ deduction.

Those taxes aren’t sales taxes. They are excise taxes. The difference doesn’t mean a thing to you, when you’re paying the tax, does it?

Unfortunately, no deduction here. Sorry.

Keep digging though. Maybe, if you shop a lot, you’ll find enough sales taxes on all the register receipts you’ve saved. Otherwise, use the optional sales tax tables. http://www.irs.gov/publications/p600/index.html

And remember, you can find answers to all kinds of questions about sales taxes and other tax issues, free. Where? Where else? At TaxMama.com

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