On 2014 returns, taxpayers can choose to deduct state and local income taxes or state and local sales taxes. Those who opt to deduct state and local sales tax take the amount of their deduction from an IRS table based on the number of people and income in the household. However, taxes on big ticket items, such as the purchase of a car, can be added to the amount from the table. Compare the two possible deductions (income or sales tax) and take the greater amount. Note: For 2015, the option to deduct state and local sales tax does not apply unless Congress extends it.
Real property in which 80% or more of the gross income is from dwelling units. Under MACRS, depreciation is claimed over 27.5 years under the straight-line method.