Other Taxes

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 page 1 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. 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 page 2 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

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