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February 21, 2025
Question

Is Excise tax on a car deductible and where do you put it in the taxes?

  • February 21, 2025
  • 1 reply
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What about in the state of South Dakota?

    1 reply

    DawnC
    February 21, 2025

    No.  An excise tax isn't deductible if it's for a personal expense.   However, some states and localities erroneously label excise taxes as personal property taxes, which may be deductible. 

     

    Excise taxes imposed on personal property (vehicles, campers, boats, RVs, etc.) are an allowable deduction if two conditions are met:

     

    1. The excise tax is determined by the property's value, usually a set percentage.
    2. The excise tax is imposed annually.

     

    Your South Dakota car registration, however, is not deductible.  See Is My Car Registration Deductible?  

     

    Excise taxes that are necessary to conduct business can usually be deducted as a business expense.

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