Sales Tax

[Edsel]

This applies to returns prior to 2018.  We all have older year returns, whether we like them or not.

This guy is high income ($300,000 salary, for purposes of illustration).  Goes out and buys a farm, takes s.179 on expensive farm equipment, then claims a loss of $250,000.  His only revenue for selling cattle was $900.  (By the way, I didn't prepare this suicide return, some other idiot did)

You can guess what happened.  Yes, a couple years later, IRS disallowed the farm loss as a hobby.

So the next year, he had farm expenses but did not claim a farm loss.

NOW THE QUESTION:

For the year he did NOT claim the farm loss, he still had significant expenses.  Can he claim the sales tax on these expenses as a Sch A deduction?

My feeling as I write this is, Yes he can.

Thanks in advance for responses.

[Gail in Virginia]

In the state of Virginia, most farm expenses are not subject to sales tax so here the answer would be no.  But if your state taxes farm equipment, cattle feed, etc. then I don't see why not.

[ILLMAS]

Correct me if I am wrong, but I always thought sales tax deductions on Sch A are for for personal property purchases, not business equipment.  

[Gail in Virginia]

But if your farm is a hobby and not a for-profit enterprise, then it would be personal property purchases, not business equipment.

[Edsel]

Gail, thanks for confirming what I felt to be the case.  If they cannot be business deductions, then they are personal.

Tennessee sales taxes are on everything except certain things that lobbyists have been successful in exempting.  Certainly not farmers except freight companies have been successful exempting fuel taxes on farm produce.  The sacred exemptions include things like prescription drugs, newspapers, etc.

I have hundreds of invoices that I can calculate sales tax on.  Large purchases, so lots of money to justify the work.