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Some people are eligible to deduct their sales tax.
What Is the Sales Tax Deduction?
You cannot choose both types ofdeductible taxes.
If you file individually, you might only deduct a maximum of $10,000 in sales tax.
The $10,000 cap also applies to married couples.
Who Should Choose the Sales Tax Deduction?
But in certain situations, choosing to deductstate sales taxmay be the better route.
But if youve made large purchases, you may have paidsignificant sales taxwhich you could deduct.
You may be able to deduct the sales tax you paid on materials for home building or renovation.
But if youre not so organized, using the calculator may be the easier option.
The calculator uses your income and family size to estimate your total sales tax deduction.
These tables are a simple alternative to keeping and adding up your itemized receipts.
But sometimes it can be more difficult to tell which deduction might provide you with a higher tax benefit.
you might compare your potential sales tax deduction with your state income tax deduction.
If youre collecting numerous receipts, keep them organized and secure in a folder or box.
Always verify that your receipts are itemized and clearly show the sales tax that you paid.
To get prepared to file your taxes, organize and sort these receipts by the key in of purchase.
Alternatively, consider digitizing the receipts using a receipt scanner or an app likeQuickBooks or Expensify.
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