Several types of taxes might be deductible on other parts of your tax return:
- Any taxes paid as part of your business operations are deductible on Schedule C.
- Up to 50 percent of self-employment tax you paid on net earnings is deductible on Line 27 of Form 1040.
- Payroll taxes on nannies, babysitters, etc. may be deductible as part of the dependent care credit or, in some cases, as medical expenses.
- If you received income in respect of a decedent, you can deduct the portion of the decedent's federal estate tax that applied to this income as a miscellaneous deduction (Line 28 of Schedule A) that is not subject to the 2 percent of AGI floor (Line 26 of Schedule A). The decedent's executor should tell you the relevant amounts, if they apply to you.
Any deductible taxes not included on Lines 5, 6, or 7 of Schedule A can go on Line 8 of Schedule A. This is also where you would include taxes paid to a foreign country or U.S. possession, unless you claim the foreign tax credit on Line 47 of Form 1040.
Nondeductible Taxes. Taxes that can not be deducted include:
- Federal income taxes
- 50 percent of self-employment tax that you paid (the other 50 percent is deductible).
- Employment taxes withheld from your paycheck, and your spouse's paycheck on a joint return. These taxes include Social Security, Medicare, and railroad retirement taxes.
- Estate or inheritance taxes, other than the portion attributable to income in respect of a decedent.
- Gift taxes, whether state or federal
- Fines and penalties paid to any government as a result of a violation of the law
- License fees paid for personal purposes. This includes marriage license or driver's license fees.
- Per capita taxes imposed by a state or local government