Can someone please tell me if this is true...
Can someone please tell me if this is true...
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price. I've asked 2 different dealerships and one told yes and the other no. 
Re: Can someone please tell me if this is true...
Originally posted by awsker
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price.
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price.
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Joined: May 2001
Posts: 77
Re: Can someone please tell me if this is true...
Originally posted by awsker
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price. I've asked 2 different dealerships and one told yes and the other no.
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price. I've asked 2 different dealerships and one told yes and the other no.
In Kentucky we get taxed every which way but down.
When I buy cars I get taxed on:
1. The car I sell I have to pay usage tax for that year (we pay this every year), and even if I sell my car on January 1st I pay the tax for the whole year.
2. Sales tax on the new car at 80% of the sticker (I think that's the number)
In their generosity though, I don't have to pay usage tax in the same year I pay sales tax on a car...nice eh ?
Re: Re: Can someone please tell me if this is true...
Originally posted by jopa
I think this actually depends on the state.
In Kentucky we get taxed every which way but down.
When I buy cars I get taxed on:
1. The car I sell I have to pay usage tax for that year (we pay this every year), and even if I sell my car on January 1st I pay the tax for the whole year.
2. Sales tax on the new car at 80% of the sticker (I think that's the number)
In their generosity though, I don't have to pay usage tax in the same year I pay sales tax on a car...nice eh ?
I think this actually depends on the state.
In Kentucky we get taxed every which way but down.
When I buy cars I get taxed on:
1. The car I sell I have to pay usage tax for that year (we pay this every year), and even if I sell my car on January 1st I pay the tax for the whole year.
2. Sales tax on the new car at 80% of the sticker (I think that's the number)
In their generosity though, I don't have to pay usage tax in the same year I pay sales tax on a car...nice eh ?
Senior Member
Joined: Nov 2001
Posts: 211
For instance:
NEW car is 25,000
Old car value is 10,000 (no matter what you owe on it or if it is paid off)
You should pay taxes on 15,000 worth of car, since "supposedly" you already paid taxes on the 10,000 trade-in when you bought the old car.
NEW car is 25,000
Old car value is 10,000 (no matter what you owe on it or if it is paid off)
You should pay taxes on 15,000 worth of car, since "supposedly" you already paid taxes on the 10,000 trade-in when you bought the old car.
In Illinois, you only pay tax on the price you are paying the dealer, meaning the purchase price minus the trade in value. And if you buy it in a county you dont live in, then you have to pay a use tax.
On used cars, you pay tax based on blue book value. Meaning if you buy a car for $1000, but the blue book value is $5000, you pay tax on $5000.
On used cars, you pay tax based on blue book value. Meaning if you buy a car for $1000, but the blue book value is $5000, you pay tax on $5000.
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Joined: Mar 2001
Posts: 679
Re: Can someone please tell me if this is true...
Originally posted by awsker
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price. I've asked 2 different dealerships and one told yes and the other no.
When you trade in your car you only pay tax on the remaining balance of the new car you plan to purchase and not the total price. I've asked 2 different dealerships and one told yes and the other no.
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Oct 17, 2012 12:55 PM