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Submitted By: Andrew
Answered: November 18, 2014 8:30 am
Answered: November 18, 2014 8:30 am
Are the state and local taxes that appear on my utility bills (including my phone bill) deductible?
Not really. Most of the taxes you refer to (as well as taxes on airline tickets, gasoline at the pump, and cable and Internet access) are excise taxes, which are not deductible as itemized deductions on personal income tax returns. However, those who claim a home office deduction and figure it using actual expenses take many of these taxes into account.
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Tax Glossary
Foreign tax credit
A credit for income taxes paid to a foreign country or U.S. possession. 401(k) plan. A deferred pay plan, authorized by Section 401(k) of the Internal Revenue Code, under which a percentage of an employee’s salary is withheld and placed in a savings account or the company’s profit-sharing plan. Income accumulates on the deferred amount until withdrawn by the employee at age 59?
