No, I'm not advocating that you spend money to save on your taxes. While that technically might be true in some cases, excessive shopping can cause many more financial problems.
But all of us do shop some. And the sales taxes, both state and local, that we pay on our purchases, unless we live in one of the five states that don't collect sales taxes, could come in handy at federal tax-filing time.
If you itemize, you can deduct the state sales taxes you paid duirng the tax year.
Local sales taxes count, too.
And if you bought a car or other motorized vehicle, you can add the taxes on that wheeled purchase to your deduction amount.
Remember, though, that if your state collects both income and sales taxes, you have to choose which tax you want to deduct. You can't claim them both on your Schedule A.
Related posts:
- 2011 Daily tax tips: April, March, February and January
- State Tax Departments
- State sales tax holidays
- Tax holidays: Bonanzas or bogus?
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