Taxpayer asks:
Can I deduct state sales tax for 2008 and deduct state income tax paid for another year (2007)??
Taxgirl says:
Absolutely! There is no rule that the taxes must have been assessed in 2008 in order to take them as a deduction. Assuming that you itemize your deductions, you can deduct state and local taxes actually paid in 2008, regardless of when assessed. You cannot, however, include penalties or interest associated with prior tax years.
You cannot deduct certain state and local taxes, such as the gas tax, car inspection fees, assessments for sidewalks or improvements to your property, tax you paid for someone else, and fees for marriage licenses, driver’s licenses, dog licenses and the like.
And remember, for the 2008 tax year, you have the choice to elect to deduct state and local general sales taxes paid in 2008 or state and local income taxes paid in 2008. You cannot, however, deduct both.
Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.
took a car loan out 2008 but totaly paid it off after 2/09. Can i get the new car tax credit ,since the car was not totaly mine until the end of 2/09?