If you’re on the fence about buying a new car this year, the IRS has an incentive that may help you decide.

Taxpayers who purchase a new vehicle before Jan. 31 are eligible to use the sales tax, up to $49,500, as a tax deduction.

“The more expensive the car, the more sales tax you can take off your return,” said Mark Green, IRS media relations specialist.

The full deduction amount is available for single tax filers whose modified adjusted income doesn’t exceed $125,000, and for joint filers whose income doesn’t exceed $250,000.

The car doesn’t have to be a 2010 or even a 2009 model; as long as the taxpayer is the first owner of the vehicle, the purchase qualifies for the credit.

Passenger automobiles, light trucks weighing up to 8,500 pounds and even motor homes all qualify for the “car sales and excise tax deduction.” Foreign made vehicles also qualify.

“With this credit, you don’t have to itemize your taxes,” said Green.

“If you choose not to itemize it can increase your standard deduction, or you can itemize, whichever way is going to benefit you the most.”

There isn’t a limit to the number of vehicles purchased; taxpayers can claim multiple purchases as long as the vehicles are new. Depending on the vehicle, they may also qualify for an additional tax deduction.

“If the vehicle you purchase is a hybrid, you could qualify for up to a $3,400 tax credit,” Green said.

Both the car sales tax deduction and the expanded hybrid vehicle tax credit are a part of the American Recovery and Reinvestment Act of 2009. The hybrid vehicle tax credit was offered previously, but the ARRA increased the credit amount, Green says.

“In general, in order to take advantage of some tax credits, you have to itemize your taxes, but with sales tax deduction you don’t have to, which is why it is so special,” said Green.

“If you have the money and are in the market, now is a really good time to buy (a new car).”