Sales tax deductions are based on the amount of sales taxes paid during a given year, and are allowed if a taxpayer is filing Form 1040 and itemizing expenses under Schedule A, reports the Internal Revenue Service. The taxpayer may deduct either sales taxes or state and local income taxes.
There is a set amount of optional sales tax that the taxpayer is allowed to claim, according to the Internal Revenue Service. A taxpayer can calculate the amount in a sales tax calculator provided on the Internal Revenue Service's website by plugging in the zip code, the tax year and some other items of information from the draft Form 1040. With this information, the calculator computes the maximum allowable state and local sales tax deduction the taxpayer may claim.