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Can I deduct my state taxes?

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Can I deduct my state taxes?

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State taxes are certainly deductible on your personal tax return, however, if you are not itemizing your deductions, the state tax deduction will not impact your return. Deductible taxes include state and local income tax or sales tax, property tax paid during, and any other mandatory tax charged by the state or locality during the year.

It’s important to note that you have the option of deducting the larger of State income taxes (taxes paid with the year end state return as well as estimated taxes paid during the year) or state sales taxes. The state sales tax deduction is usually worth considering if you bought a car or made another major purchase during the tax year, or if you live in a state with a high sales tax rate.

Also worth mentioning, if you deduct your state income taxes as an itemized deduction, and a refund is received in a later year, the refund will have to be reported as income on your tax return.

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Tickmark, Inc. and its affiliates do not provide legal, tax or accounting advice. The information provided on this website does not, and is not intended to, constitute legal, tax or accounting advice or recommendations. All information prepared on this site is for informational purposes only, and should not be relied on for legal, tax or accounting advice. You should consult your own legal, tax or accounting advisors before engaging in any transaction. The content on this website is provided “as is;” no representations are made that the content is error-free.

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published

October 1, 2018

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Phillip Ingelmo

Phillip Ingelmo

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