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How does buying a car affect taxes?
I'm wondering if I can make any tax deductions with the purchase of my car. How does buying a car affect my taxes?
Matthew Macgugan · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
- Sales tax: The IRS permits you to deduct either local and state sales taxes or local and state income taxes, but not both.
- Operation costs: If you use the vehicle forbusiness, charity, moving, or medical needs, you can deduct some operational expenses.
If you aren’t sure about how to itemize your deductions, you may want to speak with a tax specialist when tax season rolls around. Until then, keep all of your
sales documents
safe and organized.View full answer
- Gregory R.
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