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Old 04-05-2011, 09:28 PM
 
77 posts, read 180,487 times
Reputation: 67
Default Is the NC Highway Use Tax deductible on Federal Income Tax?

Hoping someone has some insight. Searching previous posts don't have a concrete answer on this one.

I purchased a used vehicle out of state in 2010. When I registered at the DMV I paid:

$28 License Fee
$40 Title
$30 Specialized plate
$492 HUT Tax

Is that $492 HUT (highway use tax) deductible on my federal income tax return under personal property taxes. It is based on 3% of the cars value.

Previous posts indicate the yearly property tax bill on all vehicles based on the value are deductible minus the fixed fee. But I cannot find a clear answer on this one time HUT tax. Thanks for any help
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Old 04-05-2011, 10:09 PM
 
Location: Cary, NC
601 posts, read 2,020,603 times
Reputation: 844
Quote:
Originally Posted by dba4life View Post
Hoping someone has some insight. Searching previous posts don't have a concrete answer on this one.

I purchased a used vehicle out of state in 2010. When I registered at the DMV I paid:

$28 License Fee
$40 Title
$30 Specialized plate
$492 HUT Tax

Is that $492 HUT (highway use tax) deductible on my federal income tax return under personal property taxes. It is based on 3% of the cars value.

Previous posts indicate the yearly property tax bill on all vehicles based on the value are deductible minus the fixed fee. But I cannot find a clear answer on this one time HUT tax. Thanks for any help
HUT is most definitely NOT deductible. I just went through this with the IRS when they corrected parts of my schedule A after I tried to claim it. The IRS statute says that to be deductible, a tax has to be based on the value of the property AND be assessed on a yearly basis. Since the HUT is not assessed on a yearly basis, it is not deductible. Your annual property tax bills, on the other hand, are deductible. But not HUT. Hope this helps!
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Old 04-05-2011, 10:34 PM
 
77 posts, read 180,487 times
Reputation: 67
Helps big time. Thanks.
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Old 02-01-2012, 07:22 PM
 
9 posts, read 19,878 times
Reputation: 33
I just registered my 2 vehicles today and got hit with these fees. What a scam the state has going for it. Had I known it would be so high, I would've taken my chances and waited until my Florida tags expired. The state has no decency to realize that people have huge expenses associated with moving and money gets tight, then to get hit with hundreds of dollars with a HUT then 3 months later, hundreds more for a personal property tax. Why is the state crying poverty?
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Old 02-02-2012, 05:50 AM
 
2,223 posts, read 3,071,783 times
Reputation: 2442
Quote:
Originally Posted by JoeD1667 View Post
I just registered my 2 vehicles today and got hit with these fees. What a scam the state has going for it. Had I known it would be so high, I would've taken my chances and waited until my Florida tags expired. The state has no decency to realize that people have huge expenses associated with moving and money gets tight, then to get hit with hundreds of dollars with a HUT then 3 months later, hundreds more for a personal property tax. Why is the state crying poverty?
Yes, I suppose the decent thing to do would be to let people move here and take advantage of all the state has to offer without having to pay a penny. Just let all of us long-time residents shoulder the burden, right?
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Old 02-03-2012, 06:05 AM
 
Location: Lansing, MI
2,691 posts, read 3,349,741 times
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Quote:
Originally Posted by arbyunc View Post
Yes, I suppose the decent thing to do would be to let people move here and take advantage of all the state has to offer without having to pay a penny. Just let all of us long-time residents shoulder the burden, right?
I don't think anyone is saying that, just pointing out the difference between NC's HUT versus other states. And, if someone does wait out for their existing plate to expire, they aren't taking away from NC's tax base - they will still end up paying it in the long run. Maybe more than just the tax if they are caught and ticketed.

The HUT takes place of the sales tax that other states charge on vehicles. Those of us that have bought and paid the sales tax in another state at the normal sales tax rate now have to pay HUT because of how the HUT law is written. HUT is due any time there is a change made to the title, where sales tax is due only when a sale has taken place. Coming from a another state, having to pay a one time tax that we've already paid out on that vehicle is a bit of a shock to the system.

In 2008, I bought my Civic and paid 6% to the state of Ohio. In 2011, I had to pay another (is it 3%?) to the state of NC. Other states will honor the sales tax you've paid to another state, so no tax due when first registering the vehicle. NC is beating to their own drum. The vehicle is only titled to me. If I want to change the title and add my husband to it, I have to pay the HUT all over again.
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Old 02-03-2012, 06:43 AM
 
2,223 posts, read 3,071,783 times
Reputation: 2442
chance2jump, just to clarify, there is an exemption for transfers between immediate family members, so you wouldn't have to pay the tax to add your husband to the title.

But the point is that NC taxes are different from other states...not necessarily more or less overall, but different. You'll find the overall tax burden in NC is slightly higher than the average, but certainly not out of line or excessive when compared to other states. For example, our gas taxes are high, but our property taxes are lower than many other states. So when people complain about a specific tax in NC, they seem to forget that overall they're usually not paying much more than where they came from. And in some cases they may be paying less.
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Old 02-03-2012, 06:47 AM
 
1,479 posts, read 2,576,766 times
Reputation: 690
Default here is why

[quote= Why is the state crying poverty?[/QUOTE]

Because when someone sells their home in another state and then comes here they start repeating how much money they made/saved and then how much better the cost of living is here.

They know that there is more to take from the people...
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Old 02-04-2012, 11:58 AM
 
Location: Berkeley County
122 posts, read 60,481 times
Reputation: 85
Quote:
Originally Posted by JoeD1667 View Post
I just registered my 2 vehicles today and got hit with these fees. What a scam the state has going for it. Had I known it would be so high, I would've taken my chances and waited until my Florida tags expired. The state has no decency to realize that people have huge expenses associated with moving and money gets tight, then to get hit with hundreds of dollars with a HUT then 3 months later, hundreds more for a personal property tax. Why is the state crying poverty?
Even West Virginia has repealed it's "Privilege Tax" on registering vehicles you bring with you from another state. So long as you paid tax on it when you bought it in another state.

Taxes are a huge expense for any family that is lower middle class on up!
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Old 02-07-2012, 12:48 PM
 
396 posts, read 227,887 times
Reputation: 288
The tax doesn't seem to be stopping anyone from moving here. Might as well raise it.
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