New year. Sorry, time to think about your taxes…Because an estimated 40% of Americans do their own taxes, the do-it-yourself filer may forget about a deduction for Taxes and Fees on New Motor Vehicle Purchases.
Did you buy a new car, light truck, motor home or motorcycle in 2010? The general Sales Tax and 2010 New Vehicle purchase Sales Tax deductions have been extended for this year. t means that you can deduct state, local, and excise taxes related to the purchase. If your state has no sales tax, you can instead deduct other taxes or fees the purchase generated.
A neat feature of this deduction is you can use it to increase your standard deduction or take it as a regular itemized deduction, whichever works out best for you. There is no limit on the number of vehicles for which you can claim the deduction, provided each is a qualified new one. Consult your tax advisor.