NC: Get your sales tax back!
The last time we got our taxes done I asked my accountant if there was anything I was missing that was deductible. She said nonchalantly that the only thing I was missing was sales tax. Since I like to be SUPER prepared during tax time in an effort to get back all of the money we deserve, I asked for more details. She said that in the state of NC all state sales tax is deductible, all of it. Not just on major purchases like cars and such. Last year, I started keeping a running monthly tally of how much we were spending in sales tax. On the same spreadsheet as our monthly budget, I enter in the tax from groceries, gas, electricity, everything. Well... so far we have spent $836 in state taxes alone! I'm so excited for the due diligence because at the end of the year, we get to claim it back dollar for dollar. Yippie!
Check with your accountant for more details about your own state. For you N. Carolinians, it's not too late to start crunching those numbers!
7/23/2008 05:00:00 AM
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1 comments:
As far as I can find out deducting NC sales tax is done on the federal income tax return as an alternative (not in addition to) to deducting NC state income tax, and is available to everyone that has either a state slaes tax or state income tax. In fact this federal deduction, whether you chose to deduct sales or income tax, must be entered back on your NC D-400 and increases your NC taxable income. See link: http://www.dornc.com/taxes/individual/deduction_salestax.html. But you may be better off overall deducting the actual sales tax paid from the federal return if it is greater than the amount of NC income tax you paid and greater than the estimated sales tax amounts from the federal 1040 instructions.The amount you have paid in sales tax so far is greater than the amount we are allowed to deduct as estimated sales tax paid based on our exemptions and income so I am going to give tracking our sales tax a shot too!
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