B's Z06

I made a deal last Saturday for a 2018 Z06. Final price of the car was around 100k. I have 2 cars with a combined trade in value of 70K, so I will be paying 30k out of pocket. After looking at the sale agreement I noticed that the sales tax was based off of 100K instead of only the 30K that I'm paying out of pocket. I called the sales rep and told him I think you made a mistake with the sales tax, he said no, we bought the cars off of you for that price and it's not really a "trade in" towards the new car. So I asked him "why would I do it that way? That makes no sense." He didn't really have an answer and said he'd have to get back to me with an explanation. Has anyone else had an issue like this? I'm ready to call of the deal and go to a different dealership.

stab1991

That makes no sense at all. And all they are doing is collecting more tax for the state anyway, doesn't go into their pocket unless they will rewrite it and keep the difference after you leave.

onfire

In Virginia we get screwed like that every time. VA tax is based on the sales price period. If you traded 2 cars in with zero to pay, you pay sales tax on the price of the new car.

B's Z06

Thats what I'm thinking also Stab1991

djfury05

Find a new dealer. $100k is far too much regardless. Do some real negotiating next time unless you just enjoy giving money away to dealers.

Connman

That's just how it works...
I was going to buy a new demo (not a corvette) from a dealership, 5000 miles... agreed to $16K, then they told me I would have to pay tax on the full $23K since it was still technically a "new" car. When I found that out, I walked. Figured if I'm going to be taxed on a new car, I want a new car with 0 miles.

tobaccokid

In MA, CT, and NY the sales tax is based upon the net price paid after subtracting the trade-in valuation from the price of the vehicle being purchased. Since you wanted the purchase structured as a trade-in it would appear the dealer is trying to structure the deal differently.
Tell the dealer you will contact the state attorney general.

B's Z06

That's what I thought tobaccokid, and I'm from MA.

bapd77

In Oklahoma, you pay tax on the car purchase price, before rebates or trades. Common practice.

william wyatt

Same in AZ.No double taxation.They are ******* you by saying they bought the car VS trade in .You $100k car is worth $80k tomorrow so run.

sTz

You already paid taxes on the two vehicles that you are trading. It makes no sense to pay taxes on them again, which is what you'll be doing if you accept this deal.

I traded two vehicles, on two previous occasions, in a similar fashion and only paid taxes on the remaining portion.

I believe Massachusetts is the same... GL.

h3mpking

TX you only pay taxes based on the difference of the trade value and new or used car price. I'd never in in VA.

23/C8Z

NJ same thing. Taxed once for vehicles. Whatever you trade in you have I believe 3 months to have that deducted from your new car purchase. Something to that effect. But the discount vs rebate thing is confusing.

Mike furman explained it to me. Didn't realize it as I almost always lease. But the discount say 10% off resale price is what it is. But....Any rebate you have say 10k doesn't get deducted so you actually have to pay the tax on that extra 10k (rebate).

bluestreak63

So you signed the contract already? And then you noticed it a half a week later? Didn't you look at the numbers before you signed?

The dealer is incorrect, but for you not looking at the numbers before signing on the dotted line.

mdz06vetter

Higgs Boson

are your trades leases? if so then you don't own them and don't get tax credit. otherwise, they should charge you taxes based on the address you use to register the vehicle, or they can sell it to you without taxes and fees and you go register it and pay taxes at your tax office (but you won't have license plates until you do).

Big Lebowski

Based on his answer, you are getting screwed.

Torch Red Z06

I'm just curious. What is the name of the dealership?

Scoobydoobydoo

Contact another dealer, MacMulkin is local to you or Kerbeck is in NJ. Both of those dealers will give you the honest answers and you'd probably get a better deal as well.

pkincy

Lot's of noise here, but everyone is ignoring the obvious. Where is the dealer and where are you registering the car? Generally it is your state of registration that controls the sales taxes. In some states the sales tax is on the net after trade in. In some states the trade in does not reduce the tax as the tax is calculated on the price paid for the car. In fact in some cases the tax is based on what you paid for the car and adding back in any manufacturers rebates that you received. In California I paid tax on the price I paid for the car plus had to add back in the $10,000 bonus tax rebate from GM. So paid $86k but had to pay tax on $96k. My $36k trade in made no difference.

So first figure out the states rules. Then if those rules allow for a trade or trades to lower the sales taxes than ask the dealer to write the contract properly.