2009 tax question.

JonnieN

Did anybody on here filed their tax yet? Im just wondering how much are we getting back for the Z? I bought my for $37650 plus about 3K for NY state tax.

OldGuy

If the car was purchased in calendar 2009, the sales tax is a deduction from your taxable income for 2009 Federal income tax purposes.
Check with your tax preparer regarding the details and your particular situation. Note: This is not a tax credit, merely a deduction.

PapoZalsa

Was this cover before in another thread?

__________________
2009 370Z MB Base w/Sport Package 6MT
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Cyberium

I filed my taxes a couple of weeks ago...

I bought my car for $37000 and the tax was around $2600. I don't know the exact amount because I did my taxes via Turbotax but it looked like my refund went up around 1200-1500 dollars.

For some reason I was under the assumption that we would we receiving the entire tax amount back that definitely was not the case. In any event... expect to receive at least 1000 dollars back.

Money Shot

It all depends on the person's earnings in 2009 and it's a tax deduction, not a credit so basically you just pay less taxes to Uncle Sam because they deduct your car sales tax amount from your earnings. Everything was explained on the other thread and basically I would have saved maybe $500 had I bought a Z in 2009.

elmz

^ Same here, mine went up like 400-500 after filling that portion out in Turbotax.

TheWeatherman

If you purchased after Feb. 16th, 2009. Here's the statement from the IRS. (By the way, this really ticks me off because I bought mine at the end of January of 2009.)

Special Tax Break on New Car Purchases Available in States With No Sales Tax


IR-2009-60, June 10, 2009

WASHINGTON —The Internal Revenue Service and Treasury Department today announced that a tax break for the purchase of new motor vehicles is available in states that do not have a state sales tax. Under the American Recovery and Reinvestment Act of 2009, taxpayers who buy a new motor vehicle this year are entitled to deduct state or local sales or excise taxes paid on the purchase.

The IRS and Treasury have determined that purchases made in states without a sales tax — such as Alaska, Delaware, Hawaii, Montana, New Hampshire and Oregon — can also qualify for the deduction.

The IRS said today that taxpayers who purchase a new motor vehicle in states that do not have state sales taxes are entitled to deduct other fees or taxes imposed by the state or local government. The fees or taxes that qualify must be assessed on the purchase of the vehicle and must be based on the vehicle’s sales price or as a per unit fee. According to the IRS, Congress intended for these fees or taxes to qualify for this special tax deduction.

“This special tax break is available for people purchasing a new car this year, and that can include people in states without a sales tax,” said IRS Commissioner Doug Shulman. “This means that more people can take advantage of this deduction when they file their tax returns next year.”

To qualify for this deduction, the vehicle must be purchased after Feb. 16, 2009, and before Jan. 1, 2010. Taxpayers can claim this special deduction only on their 2009 tax returns to be filed next year.

The deduction is limited to the fees or taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home or motorcycle.

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.

The special deduction is available regardless of whether taxpayers itemize deductions on their returns. Taxpayers who do not itemize will add this additional amount to the standard deduction on their 2009 tax return. The IRS reminded taxpayers the deduction may not be taken on 2008 returns.

SiXK

Yeah Weatherman, I'm with you. I bought mine in Jan 09.

I would like to know the stupid reason why people who bought before Feb 16 are getting screwed. It probably makes sense to the elitist in Washington DC (the same ones that are bankrupting our country). The U.S. is run by idiots. God help us.

__________________
Magnetic Black 2009 370Z / Pearl Yellow 1991 300ZXTT

speedworks

Same here. Just filed today, and lost out on this - sucks.

dad

A little of topic, but worth while:


Don't pay for IRS protection

"What if I get audited?" Even the most conscientious taxpayer probably asks himself that question just as he's sending in his return. It's a common nightmare, this possibility that you'll be called into the office of a bloodthirsty Internal Revenue Service agent so he can rip apart your 1040 and inflict more financial pain on you: More than 60% of taxpayers recently told the IRS Oversight Board that fear of an audit helps keep them honest on their taxes.

Enter audit protection services. These are essentially insurance plans purchased from a tax preparer or lawyer at the time of filing that promise to assist you if you get audited and to pay any additional penalties or fees arising from a tax preparer's mistake. Audit protection, however, does not protect you from paying for mistakes or fraud committed on your end, such as forgetting to include a 1099 or faking a deductible expense.

Many tax preparers include such a policy in their standard services, but others charge an additional 5% to 10% of the cost of your return for audit protection. You can also buy the service if you do your own taxes: TurboTax, for example, allows you to buy "Audit Defense" for $40, entitling you to have a third party represent you before the IRS and help you develop a strategy for dealing with the agency. (As is the case with other tax-prep software, you don't have to pay extra for reimbursement of penalties and interest incurred because of a program calculation error.)

If your preparer charges for audit protection and you have a pretty vanilla tax return, you can probably pass on the extra insurance. "Audit protection would be a waste of money for someone with most of their income reported on a W-2 and relatively simple expenses. I don't even know why you would consider it," says Robert Willens, a professor of taxation at Columbia Business School and president of a tax consulting firm.

The chances of getting audited are about 1 in 100, and many people go their entire lives without being audited, so you're likely paying for something that you won't actually use. And most audits are pretty straightforward requests for documentation on a specific item. Either you've got the documentation or you don't, and you can probably handle the correspondence with the IRS yourself.

Audit protection services may make sense if you've got a more complicated tax return or a return with a greater chance of being audited. If you've got your own business or made an unusually large charitable contribution, for example, an audit protection policy might be a wise move. But if that's the case, you may be better off going with a tax preparer that includes such services in their initial fee. Since they're on the hook to stand by their work no matter what, they just might be a little more diligent in their preparations.

Bottom line: If you're worried that the IRS might come after you for a poorly-filed return, skip the audit protection and use the cash to buy a receipt organizer instead. That way, in the unlikely event that the IRS actually does come a-knockin', you'll be ready.

Don't pay for IRS protection - Personal Finance blog - Money Magazine's More Money