Shopping for a new car or truck? The Maryland Automobile Dealers Association wants to remind consumers that purchases made through the end of December 2009 may be eligible for a special tax deduction next April. The tax break is part of the American Recovery and Reinvestment Act of 2009.
The IRS offers seven things consumers should know about the deduction:
1. State and local sales taxes paid on up to $49,500 of the purchase price of qualifying vehicles are deductible.
2. Qualified motor vehicles generally include new (not used) cars, light trucks, motor homes and motorcycles.
3. Purchases must occur after Feb. 16, 2009, and before Jan. 1, 2010.
4. This deduction can be taken regardless of whether or not you itemize other deductions on your tax return.
5. Taxpayers will claim this deduction when filing their 2009 federal income tax return next year.
6. The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.
7. The deduction may not be taken on 2008 tax returns.
(Source: "Seven Facts about the New Sales Tax Deduction for Vehicle Purchases," U.S. Internal Revenue Service 2009)
About the Maryland Automobile Dealers Association
Maryland Automobile Dealers Association (MADA) is a statewide association of new car and truck dealers managed by a Board of Directors, which consists of members representing districts throughout the State. MADA was founded in 1910 as a non-profit trade association for the purpose of: "facilitating the exchange of ideas among its members; to encourage sound business policies; to foster constructive motor vehicle legislation; to discourage destructive motor vehicle legislation, and to promote confidence, respect and good fellowship among all who are directly or indirectly engaged in the motor vehicle industry." For more information visit MADA online at www.mdauto.org.
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The IRS offers seven things consumers should know about the deduction:
1. State and local sales taxes paid on up to $49,500 of the purchase price of qualifying vehicles are deductible.
2. Qualified motor vehicles generally include new (not used) cars, light trucks, motor homes and motorcycles.
3. Purchases must occur after Feb. 16, 2009, and before Jan. 1, 2010.
4. This deduction can be taken regardless of whether or not you itemize other deductions on your tax return.
5. Taxpayers will claim this deduction when filing their 2009 federal income tax return next year.
6. The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.
7. The deduction may not be taken on 2008 tax returns.
(Source: "Seven Facts about the New Sales Tax Deduction for Vehicle Purchases," U.S. Internal Revenue Service 2009)
About the Maryland Automobile Dealers Association
Maryland Automobile Dealers Association (MADA) is a statewide association of new car and truck dealers managed by a Board of Directors, which consists of members representing districts throughout the State. MADA was founded in 1910 as a non-profit trade association for the purpose of: "facilitating the exchange of ideas among its members; to encourage sound business policies; to foster constructive motor vehicle legislation; to discourage destructive motor vehicle legislation, and to promote confidence, respect and good fellowship among all who are directly or indirectly engaged in the motor vehicle industry." For more information visit MADA online at www.mdauto.org.
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