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March 22, 2020
Question

In Texas is sales tax on a new vehicle taxable?

  • March 22, 2020
  • 1 reply
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    1 reply

    March 23, 2020

    I think you want to know if your new car sales tax is deductible.  If you are itemizing your deductions on your federal return, you would want to enter the sales tax you paid since TX has no state income tax.

     

    SALES TAX

    You can enter the sales tax you paid for the car you purchased in 2019 by going to Federal>Deductions and Credits>Estimates and Other Taxes Paid> Sales Tax.  You will be asked if you paid sales tax on a major purchase, and you will be able to enter the sales tax you paid for your new vehicle.

     

    Sales tax is an itemized deduction.  If your state has a state income tax, you have to choose between using the deduction for your state tax paid OR the sales tax deduction, whichever is higher.  The TT process will suggest one or the other as you prepare your return.

    “Major purchases” that you can enter for the sales tax deduction include:

    Motor Vehicles (cars, trucks, motor homes, RV’s, sport utility vehicles and off-road vehicles

    Aircraft or boats

    Mobile homes

    Manufactured housing

    Building materials for major home improvements

    You cannot deduct: furniture, jewelry, home electronics such as TV’s or computers

    https://ttlc.intuit.com/questions/1901222-which-deduction-should-i-choose-sales-tax-or-income-tax

    https://ttlc.intuit.com/questions/2566624-how-much-sales-tax-did-i-pay-last-year

    https://ttlc.intuit.com/questions/3148443-how-do-you-define-major-purchase-or-major-item-for-the-sales-tax-deduction

    https://ttlc.intuit.com/questions/1900791-how-do-i-find-my-local-sales-tax

    https://ttlc.intuit.com/questions/2566624-how-much-sales-tax-did-i-pay-last-year

    **Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**