Do purchasing receipts contribute to my tax returns?

Question

For example, i buy the TV $5000 w/ $440 tax and grocery w/ $1.20 tax. If I keep the receipts of those purchases, $440 + $1.20 = $441.20 would contribute to my tax return???

thank you

Answer 1

I'm going to guess that you are refering to sales taxes. You have the option (if Congress extends it again) to take sales taxes as a deduction instead of income taxes. There is a standard amount to use based on your home state and income to which you may add sales taxes paid on certain items like a car. The other option is to keep track of all your purchases and deduct the actual amount of sales taxes paid.

This benefits mostly people who live in a state that doesn't have an income tax (Texas, Florida, and Washington are a few). Some people who live New York may also benefit because New York allows a deduction for sales tax as long as you deduct sales tax on your federal return. This helps mostly those who are deep into the Alternative Minimum Tax (AMT).

Answer 2

Maybe. If you itemize, you have a choice of deducting sales tax or state and local taxes. If you choose sales tax, then you have a choice of using a table for your state, income range, and family size, or the total of actual receipts. If you use the table amount, you can add sales tax paid on purchase of a car, boat or plane.

If you don't itemize, or if you choose to deduct state and local taxes rather than sales tax, or if you choose sales tax but use the table amounts, then you wouldn't get any tax use from the receipts you mention.

Answer 3

IF you itemize deductions, you can deduct EITHER the sales tax you paid OR the state income tax you paid. Depending on your other deductions and the amount of state income tax if any, the sales tax may of may not provide a benefit.

That option was due to expire, I don't recall is you can still deduct sales tax.

Answer 4

Are the items that you purchased for business use or personal use? If they are specifically for business use, then you should keep your receipt for income tax purposes and write on the receipt the item, date and reason for purchase. If part of the receipt (ie., the groceries) was for personal use, then highlight that part that is for business and you would only be able to claim the business portion of that receipt, not all of it.

You should purchase personal items separate from business items in order to maintain proper record keeping.

If neither of the items is for business usage, you cannot claim them as deductions on your income taxes, however, keep your receipt in case your TV is defective and comes with a warantee.