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Category: Finding Deductions

What Personal Property Taxes qualify for a deduction?

The IRS will allow you to deduct certain state and local taxes you paid during the year on personal property (such as a car or a boat). To be deductible, the tax must be charged to you and must have been paid during the tax year.


Deductible personal property taxes are only those that are based on the value of the personal property. For example, if you pay a yearly fee for the registration of your car, you may pay part of the fee for the tag and part of the fee in ad valorem tax. In fact, part of the fee, depending on your state, may even be based on other factors such as the weight of the vehicle. Only the ad valorem tax that was paid may be deducted because it is the part of the fee that is based on the value of your vehicle.


In addition, to be deductible the tax must be charged to you on a yearly basis. Even if it is actually collected more than once a year or less than once a year, it must be charged to you annually.


TaxSlayer Entry: If you did pay any qualifying personal property taxes during the tax year, you can enter these under: Deductions >> Enter Myself >> Itemized Deductions >> Taxes You Paid.