photoguy

Ok. If I buy a 45K car in Va (I am in PA), from a dealer,and trade a 35K car, do I pay the sales tax on the 10K in Va or in PA?

I did by a car from out of state from a private owner and paid tax in PA. I assume it is the same for a dealer? Am I correct?

Thanks.

C6ToGo

you should pay tax in the state where you title the car.

LLWS

Why aren't you paying tax on the whole $45k?

H2LS3

NPh2005

Usually you only pay tax on the difference between your trade-in value and the new car purchase price. The advantage of trading something in.

gilly6993

that's the case for most states.....some screw you and charge you tax on the entire purchase though....

MNVette

Usually, the "net" purchase price is what you're taxed on - since you are giving something away with an agreed upon value (trade-in), you subtract that from your new purchase's price, and that is what you tax. Some states, however, tax the whole purchase price as some kind of "use" tax.

photoguy

I will pay 600.00 tax in PA if I trade as opposed to 2700.00 if I buy outright. I save 2100.00. It is like getting 37,100.00 if I sell it to a private owner which is not a bad price for an 05 2lt.
Something to consider when buying with/without a trade.

9C1

Depending on the relationship between the states, if any, you may pay part or all of the tax to the selling state and then settle out the difference, or refund, when you get tags in your home state.

Example: I bought my car from a dealer in Indiana, but did museum pick-up. They charged me Indiana tax (6% IIRC) because I picked up the car in Kentucky. Had I picked it up in Indiana they would have charged me the Illinois rate (8%) and sent that into Illinois. They also would have applied for the Illinois tags had I picked it up in Indiana, but instead they issued me a 31-day temp tag from Indiana -- and I had to square with Illinois, and the county I live in, for the taxes due.

See how screwed up this can get? In the end you can count on the tax man getting his share eventually.

Chalky

So, in the end, IL got their 8% and your local munipalities got their local cut as well.

photoguy

Just found out that VA charges 3% on the purchase price so I will be paying twice since PA will charge me 6% on 10K.
That sucks

2bubbas

Not in MI you don't. Pay on full price.

Chalky

I lived in MI for 10 years. Evidently nothing has changed. What a rip for a state that depends, well used to depend, on the auto industry.

Chalky

Is that possible to charge you sales tax in two different states? That doesn't seem right.

adam329

Not is NY, I have a museam delivery in jan. I only pay the car, and get a temp tag. When I register it here in NY, I get hit with my outrageous sales tax of 8.625%. We have the highest taxes in the country.

not08crmanymore

you pay sales tax WHERE YOU LIVE,NOT WHERE YOU BUY!If they're trying to double charge,don't buy the car!

9C1

Absolutley -- every penny, and I have it all documented just in case it helps with the federal tax bill -- but I doubt that it will.
Senior on a fixed income here, and I can't catch a break at all from taxes.
Terry

Crystal Vette

Kentucky....no trade in allowance.....charge sales tax on purchased amount.....regardless of a trade in or not. OUCH>>>>

photoguy

Just figured it. I will owe VA 1350.00 and then PA 600.00. So much for my theory of buying out of state with a trade.

Chalky

I think IL is becoming a bigger tax hell than WI. BTW, I am in same boat.