above the line deduction for use tax on car

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Subject Author Date above the line deduction for use tax on car removeps-groups@yahoo.com 10-05-2009  Re: above the line deduction for use tax on car Alan 10-05-2009  Re: above the line deduction for use tax on car paulthomascpa 10-05-2009
Posted by removeps-groups@yahoo.com on October 5, 2009, 11:37 am Please log in for more thread options Obama's stimulus plan provides an above the line deduction on the sales tax of purchasing a new car, on the first 49500 of the cost of the car. If you buy a used car from an individual in California there is no sales tax when you purchase, but there is use tax when you register the car at the DMV. The use tax is basically the sales tax on the purchase price you paid. Is this use tax also deductible? >From the law I would imagine the answer is yes. ‘‘(A) IN GENERAL.—For purposes of this section, the term ‘qualified motor vehicle taxes’ means any State or local sales or excise tax imposed on the purchase of a qualified motor vehicle. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Alan on October 5, 2009, 12:32 pm Please log in for more thread options removeps-groups@yahoo.com wrote: > Obama's stimulus plan provides an above the line deduction on the > sales tax of purchasing a new car, on the first 49500 of the cost of > the car. If you buy a used car from an individual in California there > is no sales tax when you purchase, but there is use tax when you > register the car at the DMV. The use tax is basically the sales tax > on the purchase price you paid. Is this use tax also deductible? >>From the law I would imagine the answer is yes. > > ‘‘(A) IN GENERAL.—For purposes of this section, the > term ‘qualified motor vehicle taxes’ means any State or > local sales or excise tax imposed on the purchase of a > qualified motor vehicle. > (i) IN GENERAL.—The term ‘qualified motor vehicle’ means— ‘‘(I) a passenger automobile or light truck which is treated as a motor vehicle for purposes of title II of the Clean Air Act, the gross vehicle weight rating of which is not more than 8,500 pounds, and the original use of which commences with the tax- payer, ‘‘(II) a motorcycle the gross vehicle weight rating of which is not more than 8,500 pounds and the original use of which commences with the taxpayer, and ‘‘(III) a motor home the original use of which commences with the taxpayer. Note the reference to "original use of which commences with the taxpayer." Used cars don't count. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by paulthomascpa on October 5, 2009, 2:03 pm Please log in for more thread options > Obama's stimulus plan provides an above the line deduction on the > sales tax of purchasing a new car, on the first 49500 of the cost of > the car. If you buy a used car from an individual in California there > is no sales tax when you purchase, but there is use tax when you > register the car at the DMV. The use tax is basically the sales tax > on the purchase price you paid. Is this use tax also deductible? >>From the law I would imagine the answer is yes. > > ‘‘(A) IN GENERAL.—For purposes of this section, the > term ‘qualified motor vehicle taxes’ means any State or > local sales or excise tax imposed on the purchase of a > qualified motor vehicle. And as Alan mentioned, a "qualified" motor vehicle is a new vehicle (along with some other qualifiers). -- Paul Thomas, CPA www.paulthomascpa.com -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted home line of credit - interest deduction March 28, 2008, 3:39 pm question about line 75 - Amount of line 73 you want applied to your 2008 estimated tax June 23, 2008, 6:31 pm Gas Expense tax Line?? January 24, 2007, 2:15 am Tax Line for Expenses January 24, 2007, 2:54 am Which Line in Schedule C ? 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