The federal stimulus package signed into law by President Obama includes a $2.3 billion tax break for new car and truck buyers, which could save auto buyers hundreds of dollars.

 

As part of the stimulus package, taxpayers will be able to deduct the both local and state sales tax paid on new car purchases up to $49,500. The tax break will cover the purchase of any new car, domestic or foreign, through the end of 2009. Additionally, the deduction is "above the line," which means that it reduces the amount of a filer's taxable income. Eligible taxpayers must have an annual income below $125,000 for individuals or below $250,000 for families.

 

With the availability of this tax credit in the stimulus package, auto shoppers will see noteworthy savings on new car and truck purchases.


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