boosted180sx
Senior Member
- Joined
- Mar 27, 2017
- Threads
- 25
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- 5,038
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- Location
- torrance, ca
- Vehicle(s)
- 2017 CTR, 2016 ILX
it's safe to say he won't be hearing back from me ...
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Oh he would for sure be hearing back from me lol
it's safe to say he won't be hearing back from me ...
Very true, but this also introduces other variables, such as whether or not the car you are trying to sell has a lien. If you still owe money on the car you are trading in, then you don't avoid paying the tax to the extent of the lien. I received a trade in offer on my 09 STI of 13,000. I sold it private party two days after buying my Type R, for 19,500. I owned 16,900 on the vehicle. Had I owed nothing, I could have saved $780 in tax. But I made 6,500 more by selling it privately.In states like Texas where you are taxed on the difference between trade-in value and new car price, the tax savings can substantially offset the difference between trade-in and private-party value. You also have to put a value on the time and money it takes you to advertise, meet prospective buyers, show the car, and accompany the buyer to the bank and/or title office to ensure you get paid and end your legal responsibilities.
My purse strings are pretty tight, but I often find trading vs. selling a wash by the time I consider the tax savings and avoiding the salary loss by taking time off (or using PTO which is the same thing) - and that's before putting a value on my personal time.
In GA, vehicle taxes were changed in 2012. Five years ago when you purchased a car, new or used from a dealer, you paid 6% sales tax and you paid an annual tax each time the car was registered, about $500-$600 on average for most new cars. As your car got older the tax would decrease to around $150 (as an example). The annual tax was called an Ad Valorem tax and you could deduct that tax each year from your state income tax. At that time you could buy a used car from a private party and only pay the Ad Valorem tax, no sales tax. Back then, dealers were at a disadvantage when it came to sales of used cars. The private part used car market was very active.How does that work? Are you taxed regularly on the new car as well? If you are trading a car in for $20k and buying a new one that's $30k, are you only taxed on $10k? That doesn't make any sense to me.
EDIT: I thought about it some more, and I guess it could work in the same way that VAT or GST tax works in other countries. The tax gets passed along each time. In a sense, you paid the balance when you bought the first car.
In Colorado, we are just taxed on the new car price. It's VERY easy to sell a car here, and it makes no sense whatsoever to trade your car in (not saying it's not different in other states, just what it is here).
No.Are you taxed regularly on the new car as well?
If you are trading a car in for $20k and buying a new one that's $30k, are you only taxed on $10k?
So, in this scenario, why didn't you sell the G35, rather than trading it in?Another example, I traded a 2008 Infiniti G35 for a 2009 Honda Civic several years ago. The G35 was worth more than the Civic, so I paid no sales tax. Unfortunately, you don't get a tax refund in this case.
It's been a while and I don't have the exact numbers handy, but I believe the Civic was around $20K. The G35 was worth about $30K on trade.So, in this scenario, why didn't you sell the G35, rather than trading it in?
Ok, just curious. Thanks.It's been a while and I don't have the exact numbers handy, but I believe the Civic was around $20K. The G35 was worth about $30K on trade.
If I had bought the Civic without a trade, I would have paid $20K + $1,250 sales tax.
This was during The Great Recession at a time I was looking for a cheaper payment, a lower insurance premium, and better fuel economy as quickly as possible in case things got even worse. If I had not traded, I would have paid $1,250 in sales tax and would have continued to pay for insurance for two vehicles until the G35 sold - if it would even sell (remember: The Great Recession).
Yeah, I guess you're right. I buy and sell a lot of cars, but all but one (my EP3) have been used.@gtolio - here in Colorado, you will also only owe tax on the difference between the sale price of the new car and the trade-in value. So, depending on your specific tax rate and the value of the trade, it can certainly make a difference.
Just an FYI.
oh man, fingers crossed!Dealer just reached out to me again about the black R they have had on their lot for over a week. Originally wanted $8K over sticker, now dropped it to $7K. Told them I want white but I'd do black for MSRP + TTL and a couple extras at cost. Waiting for a reply. Obviously they want the car moved.
Haha once I hit his ass with the MSRP bomb, he didn't reply back. Guarantee that shit is still sitting there next week. It has been sitting since July so I am not shocked.oh man, fingers crossed!