sales tax deduction "specified items"

Feb 20, 2018 1 Replies

I am very confused about the sales tax deduction.



During 2017, I purchased a shipping container and built a workshop and firewood shed around it, using additional materials that I purchased myself; I paid sales tax on these materials, at the same as my usual rate, and performed the work myself. However, the shipping container was bought in a different county with a lower sales tax rate.



I also purchased additional materials to complete a kitchen renovation that I mostly performed in 2016; again, I paid sales tax on these materials, at the same as my usual rate and performed the work myself.



I have records for all of these purchases. Can I deduct the sales taxes paid on these items (in addition to the amount that is computed based off my income) ? It seems to me that they qualify, since I "purchased the materials to build ... substantial addition or to perform a major renovation and paid the sales tax directly." But some of what I read suggests that they need to be big ticket items; certainly the kitchen renovation and workshop construction were each a big ticket item, collectively, but none of the individual purchases were (except for the shipping container). And, is there any way I can deduct the sales tax on the shipping container, since I paid a different rate ?; I'm thinking if I lived in that other county when I purchased it, I could deduct it; but of course I did not.



TIA !


My background is tax collection and not tax prep, so I won't pretend to know the answers to your questions. From a collection standpoint, however, there is a good chance you owe use tax to your county on the shipping container that you purchased at a lower tax rate in another county. That would resolve the rate difference.

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