The IRS Deductions Blog

Posts Tagged ‘vehicle’

Question: President signed ?

The president signed a bill for 40% of emissions on cars to be decreased in the next decade. It is a beginning. Toyota Prius,is the number one choice for fuel efficiency.Civic Camry Honda Kia Hyundia seemed to be on top in fuel efficiency. Now How about the tax deduction for purchase of new vehicles. How does that work?

Answer: Actually it did work. The tax credit and allowance expired this past year..but the sales for hybrid vehicles soared when folks were getting a break on their income taxes. The problem I have with hybrids is that the technology is stop-gap and not the ultimate or permanent solution to the issue. The solution lies closer to the use of fuel cell technology utilizing hydrogen as fuel.

Items on Amazon Right Now for Tax Deduction New Vehicle:

Fund Your 401(k) or IRA First?

It depends on your situation, but these 10 questions can help you find the answer.

Tax Tips: HIRE Act (ASL, Captions & Voice Over)

Question: Tax deduction for mileage or vehicle cost?

Because of the current economy I have been forced to take a job where I now commute 500 miles a week, this is an office job I don’t leave the office to make sales calls or anything. My old car was a Lincoln LS which averaged about 19mpg on the highway so I was forced to sell and buy a used(I find buying a new car pointless) 2006 VWJetta diesel.

I was wondering if there is any tax deduction that I can utilize? Loan deduction on vehicle, mileage, anything??

Answer: Sorry, but no. No mileage deduction for commuting, and no other deduction or credit for buying a used car even if it is a diesel.

Items on Amazon Right Now for Sales Tax Vehicle Deduction:

The Savvy Consumer: Late tax law changes a setback for early filers

The IRS won’t take some returns till later.

Gerri Harrison on the Binghamton Business Connection

Question: Donate a vehicle with tax deduction?

I would like to know how to donate a vehicle, and how to calculate the tax deduction (federal tax ? state tax). Who I should contact with?

I have an used car current market price is about $5000, and would like to sale or donate, but this car requires $1500 to repair if I want to sale it. I would like to know if make vehicle donation (sorry, I won’t fix the car) will be better for me.

Please don’t give me any answer like “Giving it to someone in need of a car will be a lot more charitible …” or “make you feel pretty good to help others …”, I am not in the level to give away few thousands, so please give me advice if you know anything about vehicle donation.
Thanks

Answer: If you donate the car to a 501(c)3 charity, you will get a notice from the charity telling you what they sold it for (they usually sell the donated vehicles). That amount will be your deduction if you itemize on your income taxes, , and you won’t know what it is until AFTER you’ve made the donation and they’ve sold the car. Say for example that they wholesale it for $2500 – they won’t mess with fixing it either, and won’t be able to get bluebook price for a car in need of major repairs. Wholesaling it, they’d probably be lucky to get $2500. Then your tax savings for federal taxes would be $2500 times your tax bracket. If you are in the 15% bracket that would be $375 – in a 25% bracket that would be $625 in tax savings.

MattD is wrong that you can take a deduction of the fair market value of the vehicle – that rule has changed. And since it needs the repairs, the fmv would be more like $3500 anyway, not $5000.

If you don’t already itemize, it’s likely that you wouldn’t get any deduction at all unless you are already very close to being able to itemize.

If you gave it to someone who needs a car, no matter how worthy that person was, there would be no tax deduction – donations to individuals aren’t deductible.

In most states, there would be no state tax savings since donations aren’t deductible most places.

Items on Amazon Right Now for Tax Deduction Vehicle Donation:

Support for UK museums: Public funding vs private giving

LONDON. Nicholas Serota, the Tate director who was at Frieze this week, and his peers are bracing themselves for drastic cuts in arts funding to be announced next week (on 20 October). Cuts of 25% to 30% are bound to have an impact on museums and…

Charity Navigator’s Tax Tips: Valuing Car Donations

Question: Is the 2009 tax deduction itemized or is it added to the standard deduction?

I purchased a new car and was informed that i could deduct the sales tax. Filed my return but my preparer said that the standard deduction was greater than the sales tax of the vehicle so it didnt make sense to itemized it. I thought this tax deduction was in addition to the standard deduction?

Answer: You won’t get many answers here as the category is Taxes > Canada and this is a US question.

Your preparer is wrong: follow the instructions for form 1040 line 40a and Schedule L.

Items on Amazon Right Now for Tax Deduction Vehicle:

Does your business need tax help? Here’s what to avoid

Tax season is here, and deadlines are coming up a lot faster than most of us want to admit. If you’re stressing about income tax returns for your business, here are some helpful tips from the Associated Press.

TaxPlus – Tax Tips “Business Use of Vehicle”

Question: I don’t Owe Taxes- Are Deductions for Student Loan Interest & Car Donation worthwhile?

OK the short of the question is that I made way below the cutoff in 2007 to owe any taxes on my return this year (About $11,000).

However, I have a $750.00 Student Loan Deduction and a $2,000.00 Auto Donation Deduction I can claim.

Further, I moved in 2007 for a job, and spend about $400 on the truck and boxes etc.

Is it even worth to declare these deductions? I mean it won’t “deduct” from any taxes, because I am not paying any, right?

Those deductions won’t inflate any return I get, will it? I couldn’t imagine it would, knowing how the Govt. likes to stick it to we people of the great unwashed masses.

So should I use the deductions? Will it contribute anything meaningful to my return? or is it just more paperwork for little, if anything, in return?

Answer: 1. Contrary to what rtfm wrote, moving expenses are an adjustment, not an itemized deduction, and may be claimed IN ADDITION TO the standard deduction.
2. Judy’s answer should say $11,000, not $11,00, but otherwise seems right.

Items on Amazon Right Now for Tax Deduction Auto Donation:

Year-end tax tips

There are only a few days left until 2010, but there are still a few things you can do to save money in 2009.

Charity Navigator’s Tax Tips: Valuing Car Donations