If you do not itemize on your tax returns, then you probably will not qualify. Itemizing means that you report all your expenses above a standard deduction. NewsChannel 11 talked to a local accountant and asked him exactly how it works.
|Texans Could Save Hundreds With Approval Of Tax Bill|
Certified Public Accountant Reid Warner shoots straight about who will qualify for a sales tax deduction for 2004. He says those who itemize will benefit the most. "I think the obvious type of family that would benefit is that they own their own home, they have a mortgage, pay property taxes may have charitable donations," said Warner.
If you want to take advantage of the sales tax deduction, keep your receipts. Warner says you do not have to. He says the Internal Revenue Service will provide you a table to figure out how much an average family spends per year.
"In additions to the table, you get to take the sales tax that you pay on the major purchases and the IRS is going to decide that for us by the end of the year," said Warner.
If the President does signs this into law, Texans can report all sales tax expenses, not just major expenses. Unfortunately, those who rent probably will not be effected by the new sales tax deduction law.
This new law has guaranteed to put $400 to $700 more into the pockets of families.