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When you're scouring your records for deductible expenses, don't forget that what you pay for your car's license plate might cut your federal tax bill.
State and local personal property taxes are deductible on your federal return, if you itemize. Although only a few states have a levy that's called a personal property tax, in many states at least part of what you pay annually to license your car fits the definition and can be written off.
Residents of the District of Columbia, where I live, don't get this break; but I make sure each year that my mom, who lives in Iowa, claims it.
The key is that the annual fee be based -- at least in part -- on the value of your car. Any part of the charge based on the auto's age or weight, for example, isn't deductible. If you're not sure whether you deserve this deduction, don't assume that the answer is no. Check with local officials.
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