Pennsylvania Titling Tax now Deductible on Federal Income Tax Returns!
The amendment to allow the deductibility of vehicle sales tax (Pennsylvania
Titling Tax) is a part of the final Economic Stimulus Package signed into law
February 17, 2009, by President Obama. This is a new opportunity for added incentives
and tax rebates for automotive consumers. Details below:
A customer who purchases a $30,000 vehicle at 6% tax can deduct $1,800.00 on
their federal income tax return (even if they do not itemize.)
What Taxes are Deductible?
Pennsylvania Titling Tax
What Customers Qualify for the Deduction?
- Individual customers with modified adjusted gross income of less than
$125,000 or joint-filers making less than $250,000 a year in 2009 qualify
for the deduction.
- Deductible as an “above the line” (for itemizers and non-itemizers)
deduction on federal tax return.
Any new vehicle purchased from February 17, 2009 through December 31, 2009.
This incentive is NOT retroactive! What New Vehicles Qualify for the Deduction?
- Any new vehicle, domestic and foreign, under 8,500 pounds gross vehicle
- New vehicles of any model year – when the original use commences with
- Any vehicle sold for under $49,500 qualifies for the full deduction.
Consumers may deduct sales taxes on the first $49,500 of any vehicle sold
above this price.
The information provided herein should not be used as a substitute for consultation
with professional tax, accounting, legal, or other competent advisers.