A slight tax advantage for hybrids

[32kcolors]

Originally Posted by jay_man2

Good question. Virginia has a state income tax, so I don't get to deduct sales taxes normally (or at least the state income deduction is higher, easier to figure, etc.) I'd guess you're not seeing any additional benefit if you are already able to deduct sales taxes.

We've been able to deduct either state income tax paid or sales tax paid on federal returns for a while. Does this special deduction from the American Recovery and Reinvestment Act of 2009 allow you to deduct the vehicle purchase sales tax on top of the state income tax paid?

[jay_man2]

Originally Posted by 32kcolors

We've been able to deduct either state income tax paid or sales tax paid on federal returns for a while. Does this special deduction from the American Recovery and Reinvestment Act of 2009 allow you to deduct the vehicle purchase sales tax on top of the state income tax paid?

That's how I read it.

[32kcolors]

Originally Posted by jay_man2

That's how I read it.

So sounds like this only benefits people who live in states with income tax and does absolutely nothing for those who don't, as they're already able to deduct sales tax (including on vehicle purchases) paid, just as what you said. Talk about no state income tax residents subsidizing state income tax residents.

[jay_man2]

Originally Posted by 32kcolors

So sounds like this only benefits people who live in states with income tax and does absolutely nothing for those who don't, as they're already able to deduct sales tax (including on vehicle purchases) paid, just as what you said. Talk about no state income tax residents subsidizing state income tax residents.

And thank you so much!