CCH Tax News Headlines - October 13, 2009

Oct 13, 2009 4 Replies
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CCH Tax News Headlines - October 13, 2009 Federal Headlines:



10/13/2009 - _Banks Were Family Partnership Partners, Not Secured Lenders (TIFD III-E, DC Conn.)_
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StateHeadlines: 10/13/2009 - _California --Corporate, Personal Income Taxes: Governor Vetoes Conformity Legislation_
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10/13/2009 -_California

--Unclaimed Property: Unclaimed Property Law Reforms Enacted_

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10/13/2009 -_Pennsylvania



--Multiple Taxes: Amnesty Program, Numerous Changes Enacted_

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R

What does the above mean? Will CA conform to the federal deduction for sales tax on car?

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A

Relative to sales taxes it is irrelevant as CA already requires that you subtract from your federal itemized deductions the amount of state income or state sales/use taxes.

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R

Yeah but this sales tax deduction is an above the line deduction like tuition and fees (and CA does not conform to tuition and fees).

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A

Actually it's not an above the line deduction.

This sales tax deduction for purchase of your new car is, your choice, either an additional line deduction on Schedule A, or an adjustment to your standard deduction.

See Draft Form 1040 Schedule L, the Long form standard deduction schedule. That's a promotion, as last year it was a mere worksheet.

Also see the back of new Form 1040 Schedule A. The back of Schedule A is no longer Schedule B. It is a worksheet for the Schedule A new car sales tax amount.

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