If you are considering purchasing a new car soon low prices may not be the only thing to influence your decision. Passenger vehicle purchase made after February 16, 2009 and before January 1, 2010 are most likely able to deduct the state and local sales and excise tax paid on the purchase.
 
The deduction will be available on the 2009 tax return, filed in 2010. This credit is available to any filer and not just someone who participates in itemized deductions. However, at the modified adjusted gross income level of $125,000 for individuals and $250,000 for joint filers the credit begins to phase out.
 
Source: IRS Press Release