I searched, but didn't find a recent thread with this specific scenario. Sorry for the long post/question, but thank you in advance for your help.

I purchased a new 2021 C8 for $103,139. The MSRP was $76,975 and the dealer add-ons totaled $26,164. Add-ons included the following:

STEK DynoShield PPF: $4995
3M Ceramic: $4995
GM High Wing Spoiler: $1995
GM 5VM Splitter/Skirts: $3995
GM Engine Cover: $995
3M Tint/Nitrogen: $799
GM Trident Wheels: $5995
GM C8 Luggage Set: $2395

As I'm sure you have already discovered, the add-ons are inflated in value. I knew that going in and a rough estimate is that they marked up the value by about $10,000 total. I'm fine with that, as the car was ordered, and upon arrival at the dealership, the customer backed out, thereby making it available to sell to the public (me). A $10,000 premium is reasonable in my situation in order to not have to wait 12-18 months for the car.

So my question - I live in NC, and the DMV used the total sales price of $103,139 as the assessed value to determine my tax liability. I tried to fight it and provided the window sticker and bill of sale, both showing the MSRP of $76,975. Unfortunately NC Statute 105-330.2(b) states: "The sales price of a classified motor vehicle purchased from a dealer, including all accessories attached to the vehicle when it is delivered to the purchaser, is considered the true value of the vehicle, and the assessor must appraise the vehicle at this value."

I get that, and will not fight a law that's on the books. They already removed the luggage, as it's not attached to the vehicle. My issue is that the total value they're using included an arbitrary dealer markup that they hid in the value of the add-ons vs. adding a line item on the bill of sale. Is there anything I can do to convince the DMV to reduce the assessed value? Do I have any legal recourse against the dealership for not disclosing their markup? Any other thoughts or ideas?

 

You paid a 10k markup (really closer to 15 or 20k considering the 'value' of some of those addons IMO), and you're quibbling about the tax liability?

If you stretched yourself too thin to buy it maybe you shouldnt have. If not and you're flush with cash, pay the state their ransom money and move on.

 

Sounds like the DMV calculated correctly based on what you paid. The time to contest the inflated dealer items was before you closed the sale.

 

Lol yikes

 

^I agree. Some of those prices are Sounds like you may be out of luck.

 

No, I did not stretch myself too thin, nor would I consider myself to be flush with cash. I'm also not "quibbling" about tax liability. It's a small difference in tax liability, but I want to be taxed fairly and accurately. As someone who has put their life on the line to defend this country, I don't think it's too much to ask to be treated fairly by it, especially when it comes to being taxed.

 

Thanks. I don't take issue with the inflated value of the add-ons, as they represent their markup which again, I agreed to pay for. I only take issue with being taxed on an arbitrary value assigned by the dealer by way of a markup that they determined.

If the person who ordered the car completed the purchase, they'd be taxed based upon the MSRP. They may have had the dealer add-on the exact same accessories after the deal, thereby increasing the value of the car exactly the same, but their tax liability would be less. That is my issue.

 

I'm interested to know how this plays out for you. I'm not sure what you can do about it but if the legal fees come out to be equal or more than what paying the actual taxes would cost then would it be worth it to you ? I'd just bite the bullet on this one and he done with It . Enjoy your c8

 

I wouldn't sue or anything like that, I was just curious if a statute existed requiring dealerships to disclose markups as separate line items, etc. The tax difference if they were to remove their markup would be $150 max, so it's a trivial amount, but it's the principle behind it, as I don't think it's fair or accurate.

I'll bite the bullet on this I'm sure, and I love the car, but I despise taxes, as we all probably do.

 

I’m in NC as well and this seems pretty standard. My taxes have always been based on actual price paid at a dealership or DMV assessed value for private party (to avoid parties creating fake bill of sale to reduce tax liability). As far as the original person who ordered the car if he purchased the car his taxes would be based on what he paid just like yours. So if he paid MSRP that would be what he is taxed on but if he paid 20k markup that would be included in his tax bill as well.

 

That dealer had to have won the "pool".. That's INSANE!

You stated that you were "okay with the markup" and at the same time want to possibly take arbitrary action against the dealer? It makes zero sense to me, (same as not requesting/seeing the price breakdown prior to saying "I'll take it")

Go by the old adage "Fool me once shame on me" that's an expensive "overlook" IMO..

 

You clearly misunderstood. I wasn't fooled, nor was it an expense overlook (it's a difference in taxes of less than $150). I accepted the markup, as I researched the value of the add-ons before committing and saw that there was a price difference between what they stated and the actual price of each item. I also know that used Corvettes as well as new that were not pre-ordered are selling at a marked up price. Using reason and logic, I concluded that the price of each add-on was inflated to account for the markup. Again, I personally accept paying a bit more than the car is actually worth due to supply and demand, however, I do not believe that the assessed value of the car should take the markup into consideration, as it is an inconsistent way of assessing a car's value due to the wide variation of dealer markups.

I hope that clarifies.

 

I don't think there will be much recourse. If you purchased the accessories & installation at the dealer separately, they still would've had to charge you sales tax on those services, so you'd end up paying the same amount anyways. Unless you got the dealer to disclose their markup to you and have you pay the difference under the table which is unlikely/questionable. I know it's one of the reasons MM can offer tax-free add-ons due to no state tax in NH which would be separate from what you pay for the car at your home DMV.

 

Every state in which I have purchased a car charged sales tax on the bottom line paid to the dealer (NC, VA, FL)

 

Thank you all for your helpful responses.

 

Some of the items I can see are part of the car (wheels, wing) but to me the PPF, Ceramic coating, and window tint are protective items. Would they charge you tax if you had them wax the car or wash it? I think the fact that the dealer put it all in the sales price vs. after market services is what screwed you.

 

Some of the items I can see are part of the car (wheels, wing) but to me the PPF, Ceramic coating, and window tint are protective items. Would they charge you tax if you had them wax the car or wash it? I think the fact that the dealer put it all in the sales price vs. after market services is what screwed you.

 

Thank you, I agree. That was my whole point is posing the question since many of us add a lot to our cars after purchase. I'm guessing no one here contacts the DMV after adding PPF, ceramic, etc. to tell them that their car is now more valuable, therefore they should be taxed on its new value. Though based upon some of the feedback my question has received, I must assume that they do.

 

The fact that it's on the bill of sale says you are on the hook for the total. Take it to an extreme, MSRP is just that, suggested, so what if they asked $150k for the car with zero options and you said "I'll pay that", then that's the price of the car for tax purposes.

 

I think the NC law is fair. In the pre-pandemic world, where it was routine for a sales price below MSRP, it is more favorable to the buyer. However, I agree the add-on dealer options for cosmetic stuff make it hard to swallow, but it's the simplest and fairest way to levy such a tax.