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2 Million US Taxpayers Overlook $4 BILLION in Sales Tax Deductions – Are You Leaving Money On The Table?
Posted By Ron On February 22, 2011 @ 6:00 AM In Government,Taxes | Comments Disabled
Believe it or not, over 2 million+ taxpayers don’t take the state sales tax deduction on their federal income taxes according to the U.S. Treasury Inspector General for Tax Administration. This amount is almost $4 billion in overlooked deductions each year … money left on the table that is rightfully due the taxpayers. Ouch!
Whether you use TurboTax , H&R Block Online , CompleteTax , go it alone with pencil and paper, or turn to a tax advisor , make certain you aren’t one of the 2 million people who leave almost $4 billion on the table! Hey! It’s YOUR money!
Seven states have no state income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Two others, New Hampshire and Tennessee, tax only dividend and interest income. Alaska, Delaware, Montana, New Hampshire and Oregon don’t have a state sales tax. Why is this important? Taxpayers are eligible to take a deduction for state and local sales tax OR state and local income tax (but not both).
If you’re living in a state that doesn’t have a state income tax, then you should make certain to investigate whether you’re eligible to deduct the sales tax that you pay each year to other jurisdictions. Both TurboTax  and H&R Block Online ’s software quiz you on utilizing this deduction.
To be eligible to take this deduction:
Generally, there are two ways to calculate your sales tax deduction.
Using your actual receipt deductions is the preferred method if you made a large purchase such as a car, boat, or motor home and paid a large amount of sales taxes.
Alternatively, if you use the sales tax tables, you’ll notice there are only three variables that determine the amount of your deduction:
Just make sure you take every deduction that is rightfully and legally yours to take.
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