If a buyer purchases a car out of state,does he have to pay sales tax to that state and then when they register: the vehicle in their state have to pay sales tax to their state also?

 

You only pay taxes in your home state, usually when you title or register the car. A dealer will collect the taxes and pay them to your state, an individual should not collect taxes.

 

I went through this last spring. I think it in part has a lot to do with the states involved but as a general rule you pay the taxes in the state where you plan to register the car, not where it is being purchased.
I purchased a BMW from a private owner in PA. The seller and I went to a notary [in PA they also handle car license plate transactions], transferred ownership of the car, and I was given a 30 day temporary license tag. Got the BMW down to NC, took the title to the local license plate agency, they processed the paperwork, which included collecting the sales taxes, and issued me a permanent tag.
I don't think I'd pay anyone any of the tax in the state where I'm purchasing the vehicle if I do not plan to register it there.

 

As with most legal questions the answer is It Depends.

In Colorado if you are taking the car out of state, you do not have to pay Colorado sales tax. What you have to pay in your destination state is up to them. In some states I believe there is no sales tax on private party sales, but only on dealer sales.

In Colorado if you bring a car in from out of state, if you show you paid that states sales, you do not have to pay again.

As I said, it depends. You need to check out the web sties for the various states DMVs or Department of Revenue to see how each state deals with the issue. You should not have to pay sales tax in more than one state, but YMMV.

It would help if we knew what states you are dealing with.

 

Depends on if X state has a reciprocity agreement with Y state.

You would pay your home taxes in the other state with a reciprocity state. Then your home state will credit you when applying for title/tags.
i.o.w. you'd paid taxes one time only.

 

I purchased car in PA from dealer. Drove home on PA temp tag 30 days.
I registered the car myself in CT and paid sales tax to CT DMV at the time I registered in CT.

 

Why don't you call your local DMV and ask them.

 

I live in Oregon and don't have sales tax. I bought my car in Everett WA (they have sales tax) but did not have to pay sales tax because the car will be registered in Oregon.

 

^^^ This, it depends on the state. There's a loophole in Missouri if you purchase in a different state they don't charge taxes at all. They tried to fix this last year but the Governor vetoed it for some reason. Not sure of the specifics though, I've never bought in a different state myself.

 

have bought cars in Nevada, Florida, and North Dakota and have only paid the sales tax in my home state of Minnesota

 

purchased a few cars out of state before.

 

I have purchased two vehicles in Ohio, my corvette from a private party and my pickup from a dealer. In both cases I did not pay sales tax in Ohio. However in order to get a title in PA I had to pay sales tax here.

The Outlaw

 

Thanks everybody for thoughtful replies and advice,I have never bought a car out of state.
The situation i am considering is to purchase from private seller in pa,and reg in n.j.

 

I sell cars for a living. In colorado but sell to out of state customers.. each state seems to very a little but for the most part they all have the same basic rules. If you are replacing a car then some states will allow you to transfer the plates or atleast a credit.. Other states the places stay with the vehicle and they dont offer a trasfer credit.
1: you pay taxes to your home (registering State) based upon your Address -Some states like Colorado, Taxes will very by county and city.

2: If you Finance the vehicle at a Dealer then They are required to Collect taxes to fullfill the Lean for the Finance company

3: If you Pay Cash Private Party you will only pay taxes at your local County Clerk/DMV when you reigster the car, not to the person selling it. If you buy from a dealership they have the option to Collect tax on a Cash purchase but are not required to (usually dont because its more work they are not required to do), they will however give you the titlework to take to your local DMV/County Clerk (sometimes on the spot, other times mail it to you within 30 days) and the dealer will provide a Temp Tag to drive on in the mean time (in colorado you get a 60day temp). In colorado, if you buy a car private party you are allowed a temp tag issued at the DMV/Clerk office before the hard plates.

Obviously you will want to verify any of this info with your local DMV/County Clerk. Some states are a real pain in the *** (AZ for example) for out of state purchases (atleast on the dealer side)

S

 

redzmonte, thanks for advice:

 

To the OP. I also purchased a car in PA and registered it someplace else. The transaction in PA was about as painless as it gets. I went to a notary that the seller knew who also did car registrations and temp plates. We both completed the applicable portions of the title, and the notary gave me a 30 day temporary tag. Took all of about 10 minutes.

 

However, unless this is a recent loophole, when I bought my '03 in NJ in Sept 2009, I paid sales tax on the purchase price when I registered it in Missouri. I did not pay any sales tax in NJ. All I paid there was for a temp tag to drive the car home.

 

Marineone,vettemanjack,thanks for advice.