Tax Deduction for Vehicle Registration Fees

Can you deduct vehicle registration fees on federal taxes?

It’s possible to deduct vehicle registration fees on your federal tax return. However, for personal vehicles, you can only deduct those that are calculated based on the vehicle’s value. Taxes that are based on the value of property are often called ad valorem taxes.

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Deducting vehicle registration fees

For a personal vehicle, you can only deduct registration fees if you’re itemizing instead of taking the standard deduction. Vehicle registration fees based on the car’s value fall under the state and local tax (SALT) deduction, as they’re considered a personal property tax.

For most filing statuses, the SALT deduction is limited to $10,000 per household. However, if you’re married and filing separately, the SALT deduction is capped at $5,000. You will input your SALT deduction on Schedule A of Form 1040.

If you’re self-employed and use your car for business purposes, you can deduct vehicle registration fees regardless of whether you’re itemizing, and you may even be able to deduct fees that aren’t value-based. However, you can only deduct vehicle registration fees if you’re using the actual expenses method to calculate your car expenses. The deduction is based on the percentage of the fees related to your business use of the vehicle.

What states can you deduct vehicle registration fees?

Not all states have value-based vehicle registration fees. If none of your vehicle registration fees are based on the car’s value, you won’t be able to deduct them for a personal vehicle. Here’s a guide to the states that have value-based car registration fees, along with the specific fees that fall into this category.

State	Value-based and, therefore, deductible portion
Alabama	Ad valorem tax
Alaska	Not deductible.
Arizona	Vehicle license tax
Arkansas	Not deductible. However, you can deduct the value-based ad valorem tax paid to your county.
California	Vehicle license fee
Colorado	Ownership tax
Connecticut	Not deductible. However, you can deduct the value-based property tax paid to your city or county.
Delaware	Not deductible.
Florida	Not deductible.
Georgia	Annual ad valorem tax. This applies to most cars purchased before March 1, 2013, as well as non-titled vehicles. You cannot deduct the title ad valorem tax (TAVT).
Hawaii	Not deductible.
Idaho	Not deductible.
Illinois	Not deductible.
Indiana	Excise tax fees
Iowa	Value-based portion of vehicle registration fee
Kansas	Not deductible. However, you can deduct the value-based personal property tax paid to your county.
Kentucky	Value-based portion of vehicle registration fee
Louisiana	Value-based portion of license plate fee
Maine	Not deductible. However, you can deduct the value-based excise taxes paid to your city or county.
Maryland	Not deductible.
Massachusetts	Motor vehicle excise tax
Michigan	License fee on vehicles with a model year of 1984 or newer
Minnesota	Registration tax
Mississippi	Ad valorem tax
Missouri	Personal property tax paid to the county
Montana	County option tax
Nebraska	Motor vehicle tax
Nevada	Motor vehicle tax
New Hampshire	Municipal fees
New Jersey	Not deductible.
New Mexico	Not deductible.
New York	Not deductible.
North Carolina	Vehicle property tax
North Dakota	Not deductible.
Ohio	Not deductible.
Oklahoma	Not deductible.
Oregon	Not deductible.
Pennsylvania	Not deductible.
Rhode Island	Not deductible. However, you can deduct the value-based excise tax paid to your city or town.
South Carolina	Value-based personal property tax
South Dakota	Not deductible.
Tennessee	Not deductible.
Texas	Not deductible.
Utah	Not deductible.
Vermont	Not deductible.
Virginia	Not deductible. However, you can deduct the value-based personal property tax paid to your city or town.
Washington	Regional Transit Authority (RTA) tax if required by your county.
West Virginia	Not deductible. However, you can deduct the value-based personal property tax paid to your county.
Wisconsin	Not deductible.
Wyoming	Value-based vehicle registration fees paid to the county.