0

I am a bit confused regarding the calculation of a sales tax deduction, in this case in Texas, U.S. where there is no income tax.

I am using TurboTax and it is estimating a sales tax deduction of about $1300 (based on income and state tax rates). But looking at just one of my credit card's year-end summaries, my yearly spend on that card is ~$35K, which (with some basic and valid assumptions) makes the approximate sales tax for that amount in the ballpark of $1900. And this would seem to me to be a low estimate overall as it does not include spend from a second credit card as well as some purchase transactions that get processed directly through my bank/checking account.

Can anyone square that circle for me? i.e. Am I way off/making bad assumptions? Or is it TurboTax?

Improve this question

1 Answer 1

Reset to default
2

Estimate is based on your income and location. The exact amount is based on... the actual sales tax you paid.

So, if you kept all the receipts and can prove your numbers - use the actual numbers.

Improve this answer
1
  • Makes sense, and was what I was more or less assuming. Just surprised TT was so far off, but as a retiree my income is passive, so that may be what's creating the discrepancy. Or I am just spending too much :--) Mostly I just don't want to trigger an audit from my friendly neighborhood IRS tax agent.
    – AA040371
    Commented Feb 19 at 20:22

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .