A new deduction that is part of the economic stimulus bill is the deduction for state and local sales taxes paid on up to $49,500 of the purchase price of qualifying vehicles. Those vehicles must be new (not used) cars, light trucks, motor homes and motorcycles.

You must purchase the qualifying vehicles after February 16, 2009 and before January 1, 2010.

This is a special deduction that can be taken even if you do NOT itemize your return, meaning you take a standard deduction.

This deduction is NOT available on 2008 returns and there is a phase out provision for individual filers with adjusted gross income over $125,000 and married filing jointly taxpayers with adjusted gross income over $250,000.

 
This information is provided in an effort to help you gather and organize the information necessary to file your individual or small business income tax return. While these financial tools are not a substitute for financial advice from a qualified professional, they can be used as a starting point in your decision making process.