IRS Sales Tax Calculator
Deducting Local and/or State Sales Taxes on Your Tax Return
IRS Sales Tax Deduction Calculator
Use the IRS sales tax calculator to determine your sales tax deduction
If you itemize deductions on Schedule A and file a Form 1040, you have the option of claiming either state and local income taxes or state and local sales taxes. (You can NOT claim both.) If you did save your receipts throughout the year, you can add them up to claim the total amount of sales taxes you actually paid on your return.
If you did not save all your receipts, you can still choose to claim state and local sales taxes. Simply fill out the worksheet and use the optional general sales tax tables in the Instructions for Schedule A (Form 1040). Or take the easy route and use the IRS Sales Tax Deduction Calculator.
Using the Sales Tax Deduction Calculator
To calculate the amount of optional general sales tax you are eligible to claim, just answer a few online questions and the sales tax deduction calculator will do the rest.
First select the tax year for which you are preparing a return.
Then, using your ZIP Code and just a few entries from your draft Form 1040, the Sales Tax Deduction Calculator will automatically figure the amount of state and local sales tax you can claim.
You will see the results from your entries immediately on your computer screen. Even if your state and local sales tax rates changed during the year
Regardless of whether the rates changed or if you moved your personal residence, the Sales Tax Deduction Calculator can calculate the proper result.
No personal identity information required; your entries are anonymous and the information is collected only to allow you to determine your total allowable deduction. All entries are erased when you exit or start over.
Ready to start? Continue to the IRS Sales Tax Deduction Calculator
Why Do We Pay Higher Sales Taxes In Some States And Local Municipalities?
Many cities and states get a large portion of their operating revenue by charging sales taxes on just about anything you buy.
Fortunately the federal government, Uncle Sam lets taxpayers use those sales taxes as a deduction to help reduce their IRS taxable income.
This sales tax deduction can be a particularly welcomed deduction by many taxpayers in states that don't collect income taxes but do levy a significant amount of state sales taxes.
This deduction will also benefit taxpayers that paid a substantial amount of local sales taxes in their city or town. Residents that live in states where they pay both state and local taxes may find the sales tax deduction is far more beneficial to them than the income tax write-off.
Beware, if you use the standard deduction method, you can NOT take the sales tax break. To claim a deduction for sales taxes you paid, you must itemize.