Can I claim sales tax from my major purchase as a tax deduction this year?

You're on the right track! The sales tax deduction is part of itemized deductions on Schedule A. You have two options: deduct state/local income tax OR sales tax - not both. For most people, the income tax deduction is larger, but if you made major purchases like a vehicle, the sales tax might be better. Here's how it works: The IRS has a sales tax calculator based on your income and state, giving you a base amount. Then you can add sales tax from major purchases (like your car) on top of that base amount. But remember, this only helps if your total itemized deductions (mortgage interest, property taxes, charitable donations, medical expenses over 7.5% of AGI, and sales/income tax) exceed the standard deduction ($13,850 for single filers, $27,700 for married filing jointly in 2023). With a new house, you might have enough deductions to itemize, especially when combining mortgage interest, property taxes, and that car sales tax. TurboTax should calculate both ways and show you which is better.

After struggling with the exact same issue last year, I discovered taxr.ai (https://taxr.ai) and it saved me tons of confusion. I also bought a car and was trying to figure out the whole sales tax deduction thing. The problem was that I couldn't figure out if my itemized deductions would actually exceed the standard deduction to make it worthwhile. What taxr.ai did was analyze my documents and receipts, then gave me a clear breakdown of whether itemizing would benefit me, considering all factors including the car purchase. It identified some deductions I was missing too. Their system specifically flagged my vehicle purchase and explained exactly how the sales tax would apply in my situation.

I was skeptical about taxr.ai at first (seemed too good to be true), but I gave it a shot after struggling with this exact sales tax deduction question. I uploaded my car purchase agreement and a few other documents, and within hours got a detailed breakdown. Turns out I was actually better off taking the standard deduction despite my car purchase, which saved me from wasting time gathering all my receipts. What really surprised me was that it caught that my state has a vehicle property tax that IS deductible separately from the sales tax vs. income tax choice! So I still got some benefit from my car purchase even with the standard deduction. Would never have figured that out on my own, and TurboTax's questions didn't make that clear at all. Definitely using it again this year before I even open TurboTax.

If you're trying to get clarity directly from the IRS about this sales tax deduction, good luck getting through! I spent HOURS on hold last month trying to ask about a similar situation. Then I found Claimyr (https://claimyr.com) and watched their demo video (https://youtu.be/_kiP6q8DX5c). Basically, they get you to the front of the IRS phone queue so you can speak to an actual agent. I was able to talk directly with an IRS representative who explained exactly how the sales tax deduction works with my specific situation. They confirmed that for my state, the income tax deduction was better despite my major purchases. The agent also explained some nuances about the sales tax tables that the software wasn't clear about. Saved me hours of frustration and gave me definitive answers straight from the source.

I need to eat my words about Claimyr. After posting my skeptical comment, I decided to try it myself since I had a question about home office deductions that I'd been unable to get answered. I figured it wouldn't work, but surprisingly, I got a call back in about 45 minutes connecting me to an actual IRS agent. The agent was incredibly helpful and even looked up my specific regional tax information to give me accurate guidance. She explained some nuances about home office deductions that I hadn't understood from the IRS website. For the original poster, I'd recommend using this service if you want definitive answers about your sales tax deduction question - the agent I spoke with immediately knew the rules around major purchase sales tax deductions and could provide state-specific guidance.

Just to add my 2 cents - I was in a similar situation last year with a boat purchase. The standard deduction for 2023 is pretty high ($27,700 for married filing jointly), so unless you have a lot of other itemized deductions, the sales tax from even a major purchase might not push you over that threshold. In my case, between mortgage interest (~$14,000), property taxes ($8,000), charitable donations ($3,000), and the sales tax from regular purchases plus my boat ($4,500), I was able to itemize and get about $2,500 more than the standard deduction. But it was close, and without the boat purchase, the standard deduction would have been better.

Remember that sales tax deduction isn't the only benefit of a major vehicle purchase for taxes. If you bought an electric vehicle, you might qualify for the Clean Vehicle Credit (up to $7,500). Also, if you use your vehicle for business, you might be able to deduct mileage or actual expenses regardless of whether you itemize or take the standard deduction.

Don't overlook state-specific rules either! Some states have different regulations about what qualifies for sales tax deductions. For example, in Texas there's no state income tax, so the sales tax deduction is almost always better than trying to deduct state income tax (which would be $0). But in high-tax states like California or New York, you'd need to run the numbers carefully. Also, if you're close to the itemization threshold, consider timing other deductible expenses. You might bunch charitable donations or pay property taxes early to push yourself over the standard deduction limit and make that car sales tax deduction worthwhile. TurboTax should walk you through this comparison, but it's worth understanding the strategy behind it. One more tip: keep that car purchase documentation forever. If you get audited, the IRS will want to see proof of the sales tax amount you claimed.

Great question! I was in a similar situation last year with a major appliance purchase. The key thing to remember is that you can only choose ONE: either deduct state/local income taxes OR sales taxes - not both. For your car purchase, here's what you need to consider: TurboTax will calculate a base sales tax amount based on your income and state (this covers your regular purchases), then you add the $2,800 from your car on top of that. But this only helps if your TOTAL itemized deductions exceed the standard deduction ($13,850 single, $27,700 married filing jointly for 2023). Since you mentioned you just bought a house, you likely have mortgage interest and property taxes that could push you into itemizing territory. Let TurboTax run both scenarios - it'll show you the exact dollar difference. With a new house AND that car purchase, there's a good chance itemizing will be better for you. Don't forget to gather all your deductible expenses: mortgage interest, property taxes, charitable donations, and any medical expenses over 7.5% of your income. The sales tax deduction can definitely be worth it, especially in your situation with multiple major purchases in one year!