If you own a vehicle or boat, you may pay annual fees to register it with the state. A portion of this registration fee, based on the value of your vehicle, may be claimed as a deduction on your tax return.
Personal property tax is deductible if it is a state or local tax that is:
- Charged on personal property
- Based solely on the value of personal property, and
- Charged annually, even if it is collected more or less than once a year.
What if my registration fees are not based on the value of my vehicle?
If your registration fees are not based on the value of your vehicle (some states base the fee on the weight of the vehicle), you cannot claim this as a deduction on your return. If the tax is based partly on the value and partly based on other criteria, it can partly qualify. Only the amount based on the value can be claimed as a deduction.
You can review your vehicle's registration card for the amount you can claim. License plate fees are not allowed to be deducted.