unique lease question
Thread Starter
Uber Waxer
Joined: May 2004
Posts: 8,651
Likes: 5
From: Hanover MD
Cruise-In 8-9-10-11 Veteran
CI 9, 10 & 11 Car Show Winner
St. Jude Donor '08-'10
unique lease question
im buying out my 2 leases early. since the cars arent registered to me but to gmac, will i have to pay sales tax again when i re-register them over to me when i buy them out?
if so, that will blow major goat azz!
if so, that will blow major goat azz!
Advanced
Joined: Dec 2003
Posts: 60
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From: Reston VA
Yep, it will blow major goat azz.
I believe that it's universal in all of the states. That would be seen as a sales transaction and as such, would be taxed. Never underestimate the governments' (fed and state) ability to get revenue...
I believe that it's universal in all of the states. That would be seen as a sales transaction and as such, would be taxed. Never underestimate the governments' (fed and state) ability to get revenue...
Thread Starter
Uber Waxer
Joined: May 2004
Posts: 8,651
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From: Hanover MD
Cruise-In 8-9-10-11 Veteran
CI 9, 10 & 11 Car Show Winner
St. Jude Donor '08-'10
thats crap because i paid tax on those ******* once already when i bought them.
so basicly i will have to pay 5 percent of 80K plus for my escalade and vette.
so much for trying to save a little money.
so basicly i will have to pay 5 percent of 80K plus for my escalade and vette.
so much for trying to save a little money.
Instructor
Joined: Aug 2004
Posts: 124
Likes: 1
From: Pasadena CA
Originally Posted by EVIL_C5
im buying out my 2 leases early. since the cars arent registered to me but to gmac, will i have to pay sales tax again when i re-register them over to me when i buy them out?
CB
Team Owner
Joined: Dec 2003
Posts: 21,847
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From: When all is said and done... there is a hell of a lot more said than done. Riverside,Texas
St. Jude Donor '05 thru '26
Originally Posted by ChefBoy
I think that you pay sales tax on each lease payment when made (at least in CA). So, paying tax on the remainder of the purchase price would make sense. If you paid it all up front for some reason, you shouldn't have to pay it again.
CB
CB
just like on a trade-in.
Team Owner
Joined: Dec 2003
Posts: 57,408
Likes: 164
From: queensbury ny
Register??
Excuse me,but the cars should already be registered to you!The title is the only thing you'll need to get in your name.And yes,when you lease,you only pay tax on the money you finance up front in the beginning of the lease,then you finance the rest and pay the tax for that amount.I personally would never buy out a lease,but if you do,that's what you'll need to pay.
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Melting Slicks
Joined: Dec 2004
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From: The second childhood is the best one of all.
The Tax Man, woo ooo the tax man. The Beatles knew best. Yes. You do not own a leased vehicle. You are renting it. When you buy out the lease, you change ownership. The tax man woo oo the tax man. He'll get you every time you change ownership. 
Team Owner
Joined: Mar 2001
Posts: 21,325
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From: small town in S.E Pa. PA
St. Jude Donor '03-'04
Wait a minute....
if your state has sales tax, you pay tax on every payment...
if you lease a 50,000 dollar car for 400 a month you pay sales tax on the 400 every month...it's calcu;lated in the monthly payment.
if the buy out is 20,000 at the end or buy out time... then you are buying a car that is worth roughly 20,000. so at that point you are paying for what you are buying.,.. you're not paying sales tax on the 50 grand the car originally cost...
its much better than buying a 50,000 car and having to throw 3000 dollars right down the drain at 6 % sales tax for eg. on purchase of a New car.
if your state has sales tax, you pay tax on every payment...
if you lease a 50,000 dollar car for 400 a month you pay sales tax on the 400 every month...it's calcu;lated in the monthly payment.
if the buy out is 20,000 at the end or buy out time... then you are buying a car that is worth roughly 20,000. so at that point you are paying for what you are buying.,.. you're not paying sales tax on the 50 grand the car originally cost...
its much better than buying a 50,000 car and having to throw 3000 dollars right down the drain at 6 % sales tax for eg. on purchase of a New car.
Instructor
Joined: Dec 2004
Posts: 166
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From: East Coast!
Brian-
My SS was leased...when I sold it, I had to pay the lovely state of MD $1,000 tax just to title it in my name, so I could turn around and hand the title over to the buyer. I was ecstatic over that.
Thankfully that $1000 didn't go towards highway repair...instead MD used it to build much needed Liquour stores.
My SS was leased...when I sold it, I had to pay the lovely state of MD $1,000 tax just to title it in my name, so I could turn around and hand the title over to the buyer. I was ecstatic over that.
Thankfully that $1000 didn't go towards highway repair...instead MD used it to build much needed Liquour stores.
Thread Starter
Uber Waxer
Joined: May 2004
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From: Hanover MD
Cruise-In 8-9-10-11 Veteran
CI 9, 10 & 11 Car Show Winner
St. Jude Donor '08-'10
Originally Posted by Ebbsnflows
Brian-
My SS was leased...when I sold it, I had to pay the lovely state of MD $1,000 tax just to title it in my name, so I could turn around and hand the title over to the buyer. I was ecstatic over that.
Thankfully that $1000 didn't go towards highway repair...instead MD used it to build much needed Liquour stores.
My SS was leased...when I sold it, I had to pay the lovely state of MD $1,000 tax just to title it in my name, so I could turn around and hand the title over to the buyer. I was ecstatic over that.
Thankfully that $1000 didn't go towards highway repair...instead MD used it to build much needed Liquour stores.
now im leaning toward just putting the money into a seperate account and having a auto payment setup. the vette i want to keep, but the escalade i am definatly not attached to at all.
i damn sure dont want to pay tax on what the buyouts are.
Team Owner
Joined: Dec 2003
Posts: 57,408
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From: queensbury ny
buyout...
well,you pay the tax on the buyout,or you don't buy them out and get a brand new car! 
hence the lease option in the first place...the ability to get a NEW car every three years or so without the upside down factor involved,and with a FAR lower payment than on a straight buy.
hence the lease option in the first place...the ability to get a NEW car every three years or so without the upside down factor involved,and with a FAR lower payment than on a straight buy.
Race Director
Joined: Aug 1999
Posts: 17,541
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From: Manhattan, KS Missing SoCal since 2005
On my lease, I am paying tax on the difference between the sale price and the residual. The tax is added to my monthly lease payment - about $50.
One of the advantages to leasing can be the fact that if you are getting a new car every few years, the tax savings can add up. Over the life of the lease, I will have paid about $1800 less in sales tax than I would have if I bought the car outright. If I buy the car at end of term, then I will owe the balance of the sales tax.
You need to check the laws for your state, because there are differences.
One of the advantages to leasing can be the fact that if you are getting a new car every few years, the tax savings can add up. Over the life of the lease, I will have paid about $1800 less in sales tax than I would have if I bought the car outright. If I buy the car at end of term, then I will owe the balance of the sales tax.
You need to check the laws for your state, because there are differences.
Race Director
Joined: Nov 2003
Posts: 12,346
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From: Mustang OK
States very on the way they tax car sales. Some assess a sales tax while other some sort of excise tax. Some base taxes on a car's value and others on weight. Also some states may tax new vehicles one way and used vehicles another. This having been said, you most likely will get better answers asking this question of whomever is the taxing authority (Tax Commission, DMV, etc.) for vehicles in your state rather than here on the Forum. Good luck. 
Last edited by GrayC5; Jul 26, 2005 at 04:37 PM.
Thread Starter
Uber Waxer
Joined: May 2004
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From: Hanover MD
Cruise-In 8-9-10-11 Veteran
CI 9, 10 & 11 Car Show Winner
St. Jude Donor '08-'10
it was just a general question, i know others have probably bought a lease out early.
i know some say they will never lease a car, they think its renting a car, but for me, i have lost enough money trading cars in that at the time it was my best choice to avoid this problem when its time to turn it in. but since i have decided to take some money that came to me and pay off my 2 leases so i dont have 2 large payments any longer.
i know some say they will never lease a car, they think its renting a car, but for me, i have lost enough money trading cars in that at the time it was my best choice to avoid this problem when its time to turn it in. but since i have decided to take some money that came to me and pay off my 2 leases so i dont have 2 large payments any longer.