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Hi,
I paid my CA property taxes with the credit card. Is the credit card fee (over $100) the county charges you to pay property taxes deductible in the Federal return? I have gotten conflicting answers.
This is what I found on the IRS site:
Can I claim my expenses as miscellaneous itemized deductions on Schedule A (Form1040)?
You have allowable deductible miscellaneous expenses.
Your expense is a qualified deductible miscellaneous expense because it was used for the purpose of producing or collecting income, or managing, conserving or maintaining income producing property, or to determine, contest, pay or claim a refund of any tax.
Report the type and amount of your expense on the "Other expenses" line of Schedule A (Form 1040). Attach your Schedule A to your Form 1040, U.S. Individual Income Tax Return.
You can only deduct the amount of your total miscellaneous expenses that exceeds 2% of your Adjusted Gross Income.
Since it is optional, it ain't goinna fly. If it were allowed, there would be all sorts of claims, such as "I had to visit Washington D.C. for a week so that I could drop my return off personally to the I.R.S. Therefore, my trip is deductible on my taxes."
The credit card fee is $100? What county you live in?
It is sure that in my county. Maybe more!
Who the frack does Government think they are? If grocery stores, gas stations, hot dog stands charged a "convenience" fee, government would be all over them with regulations and fines.
Not a tax professional (although I've taken numerous tax classes on the way to be) and here's my opinion: Although you're required to pay the deductible tax, you are not require to pay it with a credit card, so the credit card fee wouldn't be deductible.
Think of it this way: if you paid by check, and your bank charged a per-check fee, and you paid for the stamp to mail it, neither the bank fee or the stamp cost would be deductible as an expense.
This is one of the downsides to the wave of "let's raise taxes but call it a fee"--if the county just tacked $100 onto everyone's tax bill, you could deduct it. Since they call it a "convenience fee" you can't.
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