Is Pennsylvania sales tax deductible?

Is Pennsylvania sales tax deductible?

by Anthony R. Deutsch, CPA | Jan 11, 2018

In general, an individual taxpayer may elect to deduct state and local general sales taxes in lieu of state and local income taxes, but cannot do both. Also, remember that the 2017 Tax Cuts & Jobs Act that was just passed limits itemized deduction by individuals for state, local, and foreign property taxes, as well as state and local income taxes and general sales taxes paid, to $10,000 ($5,000 for married filing a separate return).

Taxpayers have two options for determining the allowable sales tax deduction amount:

  • They can deduct the total amount of general state and local taxes paid by accumulating receipts that show general sales taxes paid, or
  • Use optional tables and worksheets available in the instructions for Schedule A (Form 1040).

For more resources, check out PICPA’s Money & Life Tips, Ask a CPA, or CPA Locator.

Answered by: Anthony R. Deutsch, CPA, is a shareholder with Cocannon, Miller & Co. PC in Bethlehem, Pa.

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
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