One-time taxes generally aren't deductible on your income tax. Ad valorem taxes -- those taxed on the value of property -- generally are, though. In either case, you can't deduct taxes that you pay for your own personal car or other property without itemizing your deductions, and itemizing to claim the deduction could actually end up costing you money.
Georgia Ad Valorem Title Tax
The state of Georgia charges a one-time tax when you first buy and title a car. The tax is tied to your car's value, which is why it's called an ad valorem tax. However, because it's a one-time tax, the IRS won't let you deduct it as a personal tax deduction.
Car License Fees
Many states have an ad valorem component to their annual registration taxes for cars. Its name could vary depending on where you live, but if you pay a tax that is tied to your car's market value, you can usually deduct it if you itemize deductions. You would claim the writeoff for that portion of your car's license or registration fee on line 7 of the Schedule A form, according to the IRS' 2013 tax year instructions for that form.
Other Ad Valorem Taxes
You might be paying ad valorem taxes on property you own beyond your car. If you have a boat or airplane, it could be taxed. Other vehicles such as trailers or motorcycles are also frequently taxed on an ad valorem basis. All of these taxes are deductible on line 7 of your Schedule A. Real estate you own is also subject to property taxes that are deductible on line 6 of Schedule A.
The Drawbacks of Deductions
To itemize your deductions for ad valorem taxes, you have to give up your standard deduction. For the 2014 tax year, the standard deduction is worth $6,200, $9,100 or $12,200, depending on if you file taxes alone, as a head of household or as a married couple filing jointly. The deductions typically adjust up with inflation every year. It only makes sense to itemize if all of your deductions add up to more than your standard deduction. If all that you have is a $400 ad valorem tax on your car and $100 on a small boat, giving up a $6,200 standard deduction for the $500 write-off wouldn't make sense.
- IRS: Instructions for Schedule A (Form 1040)
- City of Roanoke: Personal Property Tax
- Shasta County Assessor-Recorder: Facts About Aircraft and Boat Assessments
- Currituck County: Personal Property Tax
- IRS: In 2014, Various Tax Benefits Increase Due to Inflation Adjustments
- Nolo: Should You Itemize or Take the Standard Deduction?
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