We turned in our lease last week and since we have already purchased another car did not renew.
That came with a $300 disposition fee which we were aware of.
We were over our miles by a bit so we owed $83.00 in mileage.
We paid tax on the mileage, as we would expect, but they also charged us tax on the fee which I questioned.
I don't pay tax on my home owner association and other various fee's so why pay tax on a lease turn in fee?
The answer I got was the state told us we had to collect it, which is incorrect, you are responsible as a corporation for knowing which taxes you must pay and must not pay.
I tried to get further as to an explanation but got no where.
A lot of companies charge tax on things they should not charge tax on. Dish network just got dinged for that, charged tax on certain portions of the bill that they were not legally allowed to collect.
I tried searching the net but could not come up with a solid answer.
Anyone?
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"You have enemies? Good. That means you've stood up for something, sometime in your life."
Winston Churchill
I would think that you would NOT have to pay tax on it as it is a service fee. However, the the brilliant legislators in our fair state did just make some changes to the taxes on service charges...so who knows...
I do not know if they could tax you for sure, but look on the bright side, you will be able to claim those taxes for your 2008 tax return if you do a Schedule A of itemized deductions. If you paid any sales tax on your new car, that can also be claimed too, but only if you itemize.
Corvette Store
Any Michigan tax experts? Lease turn in
