How is it different from buying from a private person. If you come to an agreement on the price, then you don’t pay tax to the vendor on top of that price, do you?
When you buy a used car from a dealer, should you pay tax on top of quoted price?
17
Mar
the bad seed
March 17, 2010 at 6:59 pm
depends on where you live
mantle two
March 17, 2010 at 7:45 pm
I don’t know about the tax rules in your state, but in Washington State, it doesn’t matter whether you buy from a private owner or a used car dealer, you must pay sales tax on the transaction.
You don’t make a separate fed tax payment in Washington State.
Ksyrium
March 17, 2010 at 7:54 pm
yes you have to pay tax anythime you buy a car, new or used. if you buy it from a dealer you will pay it at the time of purchase. if you buy from an individual you will pay taxes when you try to register the vehicle in your name to get a title. and lastly you will pay taxes on your purchase when you do your yearly federal taxes if you have not paid in any of the other ways. also note that you will be charged sales tax on the amount equivalent to whatever the DOT deems to be the value of the vehicle ( not the purchase price). for example, if you are “gifted” the car and the seller says you paid only $1 for the car then you still pay sales taxes on the value of the vehicle not on the $1 purchase price.
fisherwoman
March 17, 2010 at 7:56 pm
Sales tax is due in either situation, if your state collects sales tax. The tax would be collected when you transferred/registered the title in your name, on a private sale. Some states have you send the tax to the State Treasurer. The car dealer would collect the tax, at time of sale, then he would report the tax later in the year for his books.
Bill in Kansas
March 17, 2010 at 8:39 pm
Uncle Sam always gets his cut. In Kansas (as most states) you are required to pay sales tax, just like buying anything else