Q:

What kinds of purchases are tax deductible?

A:

Quick Answer

According to Bankrate, some examples of purchases that are tax deductible include boats, motor vehicles, building materials and aircrafts. These purchases can be added to local tax amounts as well as a taxpayer's regular sales tax table.

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Full Answer

Specifically, it's the sales tax on big-ticket purchases that can help a taxpayer qualify for a deduction, says Bankrate. Building materials may have to be used for a large renovation project or for an add-on to a standing structure to qualify for a tax deduction, however.

Bankrate also notes that a taxpayer should gather his annual receipts at tax time and total them up to see if he qualifies for a tax deduction. This option might be preferable to using the IRS's regular deduction tables as the taxpayer may get a larger deduction. When using deduction tables, the IRS is looking at the taxpayer's income as well as the usual amount that taxpayers who make a specific amount of money spend.

There are also certain states that add sales tax to cable services, electricity and other utilities, says Bankrate. It's recommended that a taxpayer first check with a state official to be sure that the calculated amounts match the state's general sales tax rate before the costs are deducted.

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