Personal property taxes are deductible if you itemize deductions. You pay personal property taxes on cars and trucks, motorcycles, airplanes and boats. Usually they each have a personal property tax portion and a license portion (but not always.) You need to check your bill to see how much is deductible.If you deduct auto expenses on schedule C and take the standard mileage deduction, you can also take the business portion of personal property tax on the car or truck as an addition deduction. This will help reduce self-employment taxes and may allow you to get a few more itemized deductions that are reduced by a percentage of AGI.If you have any questions, please call me at 818-317-6035 or email me at bstonercpa@sbcglobal.net and I will try to answer them.Monday I wiil talk about mortgage interest and points.You can count on us to count for you!
Brian’s Tax Musings
Do you own a home or real property of some sort? If so, you have to pay a local government (usually a county) real estate taxes on that property every year. Sometimes you pay twice a year, other times annually and if you have your taxes impounded with your mortgage, you pay monthly and the deductible amount is given to you along with your form 1098 mortgage interest statement.Here is a link to IRS Publication 17 – click on ‘Real Estate’ and it will give you more information.http://www.irs.gov/publications/p17/ch22.html#en_US_2011_publink1000173165If you have questions call me at 818-317-6035 or email me at bstonercpa@sbcglobal.net and we can discuss it.Tomorrow I will discuss personal property tax deductions, like cars and trucks, boats and airplanes. You can count on us to count for you!
Brian’s Tax Musings
One tax deduction youcan sometimes take as an itemized deduction is sales tax. The IRS has a table you can use or you can calculate your actual sales tax paid for the year (you thought you had to keep receipts before? Good luck.)The only problem is you can take the larger of your sales tax deduction or your state income taxes paid – it is an either/or situaltion; you can’t take both. State income taxes paid includes any local income taxes (in CA, state disability insurance is considered a state tax). You add them both up and take the higher of the two: the other goes into the black hole of undeductible items (where that second sock in your drawer went to.)That is the only possible reason to wade through your receipts to calculate sales tax – you may get a bigger deduction than the table and may result in some tax savings. Any questions, call me at 818-317-6035 or email me at bstonercpa@sbcglobal.net and I will try to answer them.Tomorrow I will talk about real estate taxes.You can count on us to count for you!