Tax Deduction on New-Car Purchase Available in All States

The announcement comes as part of the American Recovery and Reinvestment Act of 2009, which said car buyers could deduct state or local sales or excise taxes incurred when purchasing a new vehicle. Now states without a sales tax — we’re looking at you Alaska, Delaware, Hawaii, Montana, New Hampshire and Oregon — will also qualify.

The additional deductions cover other, non-sales fees or taxes imposed by state or local governments that affect a vehicle’s ultimate purchase price. To qualify, cars have to be purchased between Feb. 16, 2009, and Jan. 1, 2010, and the deduction will only be available on customers’ 2009 tax returns. It’s also limited to taxes paid on the first $49,500 of the purchase price of a new car, light truck, motor home or motorcycle, and is available whether or not the taxpayer itemizes deductions.

Treasury Announces Further Tax Deductions for 2009 Car Buyers (Jalopnik.com)