Tax Q: Buying from another state?

[G3O]

Would you guys tell me anything you know about what happens to tax if you buy a car from another state?

I've heard anything from it doesn't matter where you buy b/c tax will follow the county where your new car will be registered to to you do not have to pay?

I can't imagine not paying a car tax or our gov't allowing that, although I've heard it on several forums. So if I were to buy a car from another state, do I pay that state's (or county's) tax rate? or my home county tax rate?

Thank you.

alex

 

[GMZ]

It will depend on where you register the car. I have experience with this. I bought a car in AZ and had it registered there. Paid 485 or something like that for TTL, now that would have been doubled in CA. Now if you buy it in AZ and have the dealership register it in CA, then I imagine thats where you pay the taxes. But when I switched my reg from AZ to CA I filled out an expemtion waiver saying I had already paid $XXX in taxes so I didnt pay CA tax. Is that what you are talking about?

 

[G3O]

Answering my own Qs

Internet is your friend.
Ok, so I found answers.

If you buy out of state, you do not pay in that state when you buy.
But when you try to register your car in your own state, then you to pay tax.
Thank you for reading and please tell me if you have more information.

alex

 

[G3O]

It will depend on where you register the car. I have experience with this. I bought a car in AZ and had it registered there. Paid 485 or something like that for TTL, now that would have been doubled in CA. Now if you buy it in AZ and have the dealership register it in CA, then I imagine thats where you pay the taxes. But when I switched my reg from AZ to CA I filled out an expemtion waiver saying I had already paid $XXX in taxes so I didnt pay CA tax. Is that what you are talking about?

hi, i didn't see your reply before i replied to my own question.
yeah, that's what i'm talking about and you are right. so you pay tax where you're going to register your vehicle.
thank you for letting me know.

Alex

 

[GMZ]

hi, i didn't see your reply before i replied to my own question.
yeah, that's what i'm talking about and you are right. so you pay tax where you're going to register your vehicle.
thank you for letting me know.

Alex

One thing to keep in mind, since your in CA and thats where my experience was, if you have paid tax in another state (even if its less that CA tax ) all you have to do is fill out the exemption, or declaration form that you have already paid such and such amount of tax, I didnt have to pay CA tax when I switched over from AZ.

 

[mtnracer]

If you have the newly purchased car (new or used) shipped to your home state, then you only pay taxes upon registration.

If you want to drive it yourself, you'll need to register it and consequently pay taxes in the state where you bought it. The next step depends on your home state's tax laws: in some places they make you pay tax again when registering the car at home while other places provide an exemption.

 

[boston_kevin]

If you want to drive it yourself, you'll need to register it and consequently pay taxes in the state where you bought it. The next step depends on your home state's tax laws: in some places they make you pay tax again when registering the car at home while other places provide an exemption.

That would be Massachusetts... If you pay buy in another state and have it registered, and the car is less than 7 years old, you have to pay MA tax as well when it is registered - so potentially a double hit on taxes.

 

[BC4Runner]

If you want to drive it yourself, you'll need to register it and consequently pay taxes in the state where you bought it. The next step depends on your home state's tax laws: in some places they make you pay tax again when registering the car at home while other places provide an exemption.

It does depend on state. I purchased a new truck in Georgia and drove it home to Michigan and registered it here. I did not have to register it in GA and pay GA tax before I could drive it home.

 

[JungleJim]

That would be Massachusetts... If you pay buy in another state and have it registered, and the car is less than 7 years old, you have to pay MA tax as well when it is registered - so potentially a double hit on taxes.

7 years?!!!!
Do you have to pay taxes on what you originally payed for the vehicle up to 7 years previously, or do you pay taxes on the current value?

That's just not right. What else to you have to pay taxes on in Massachusetts? 7 year old....televisions? bikes? toasters? shoes?
One of the many reasons I don't live in an eastern state...

 

[G3O]

Thank you everyone for all the replies.
You have helped me purchase a new 4Runner (I decided to in-state instead of buying it from out of state).
When I get a chance I'll post up some pictures~!
Thanks again.

alex

 

[Jeff Kleb]

State Taxes


I don't know about all states and their agreements on this, but I know how it usually works here in VA. If I buy a new car in MD, DE or PA, there is no sales tax paid to the dealership in those states - and they give you one of those paper "in transit" tags that is good for 20 or 30 days.

After getting the vehicle to VA, you must take it to a state inspection station to obtain a valid (10-07, 11-07, etc., etc.) black and yellow state inspection decal that will be displayed on the inside center of your windshield. Once that is done, go to the local DMV branch office and request your title & tags. It is then that you will pay the 3 percent sales tax on the new vehicle purchase price.

Once that process is complete, you then have thirty days in which to register the vehicle with the treasurer of the county or city in which you reside. They'll send you a pro-rated bill for the personal property tax (3.5 to 4.5 percent of 'book value', depending upon where you live). If required by your jurisdiction, they will mail you the tax sticker which is affixed adjacent to your state inspection sticker.

Virginia.....where "Land of 10,000 Taxes" could be a new state slogan for our license plates.
:bash:

By the way, Gov. Tim Kaine wants to increase the 3% to 5%. 5 percent would be on par with most other states, but those other states don't have to pay personal property tax every year on their cars as do we.


I don't want VA to turn into Taxachusetts anytime soon!

 

[GMZ]

Re: State Taxes

I don't know about all states and their agreements on this, but I know how it usually works here in VA. If I buy a new car in MD, DE or PA, there is no sales tax paid to the dealership in those states - and they give you one of those paper "in transit" tags that is good for 20 or 30 days.

After getting the vehicle to VA, you must take it to a state inspection station to obtain a valid (10-07, 11-07, etc., etc.) black and yellow state inspection decal that will be displayed on the inside center of your windshield. Once that is done, go to the local DMV branch office and request your title & tags. It is then that you will pay the 3 percent sales tax on the new vehicle purchase price.

Once that process is complete, you then have thirty days in which to register the vehicle with the treasurer of the county or city in which you reside. They'll send you a pro-rated bill for the personal property tax (3.5 to 4.5 percent of 'book value', depending upon where you live). If required by your jurisdiction, they will mail you the tax sticker which is affixed adjacent to your state inspection sticker.

Virginia.....where "Land of 10,000 Taxes" could be a new state slogan for our license plates.
:bash:

By the way, Gov. Tim Kaine wants to increase the 3% to 5%. 5 percent would be on par with most other states, but those other states don't have to pay personal property tax every year on their cars as do we.
I don't want VA to turn into Taxachusetts anytime soon!

Yes VA has too many taxes! I am military so I am exepmt from most of them though :biggrin2: Still that 3% is alot less than CA, I forget what it is, close to 5-7%? I do like that reg is so cheap here, plus I get free inspections for life from my dealer. They did away with the city stickers in Hampton Roads a year or two ago.

 

[nated05]

Ah yes, gotta love personal property tax. Ill be paying prob around $400-500 in PP tax next year for my car purchased in may of '05. The amount then goes down each year as the value of the car decreases.

 

[Jeff Kleb]

Ah yes, gotta love personal property tax. Ill be paying prob around $400-500 in PP tax next year for my car purchased in may of '05. The amount then goes down each year as the value of the car decreases.

Yeah, the value goes down every year......but that type of tax means that you probably really never truly "own" the car.
:bash:

I think some states - such as Pennsylvania - have it set up the right way. You pay 6 percent at the time of purchase, and then you never pay tax on the vehicle again; and they also don't have those pesky county or city stickers to mess with.

The only bad thing, with most any state, is that they collect sales tax on new vehicles, and then again every time the vehicle is sold to someone else during its lifetime. Just think of how much more they rake in on used cars, too. Ted Kennedy fans & supporters must be very proud of this.


Where I live in VA, we got rid of requiring county tax decals last year.....but still have to pay the fee for them anyway. Smaller government, my arse!! Also, it is not rare to get stopped in an adjacent county when you pass a cop and your car is not displaying a decal at all. Most cities/counties require them, but a handful have finally dumped this archaic practice.

 

[Uneek]

Here in the sunny Golden State of California, state sales tax is 7.25% plus local county taxes depending on the county. The county taxes could vary upto 1.5% making it 8.75% for some. Sales tax is based on where you live, so a buyer residing in a county with local taxes of 1.5% will have to pay the full 8.75% in sales tax, even if they purchase their vehicle in another county with a 1% sales tax.

Vehicle registration is about 0.9-1% of the purchase price before TTL, which includes other BS fees like CHP, etc. That's paid every year and it usually drops by about 5% or so. We don't have vehicle inspections (only one time brakes and lights inspection for salvaged title vehicles), but we have smog checks every other year after the first six years of new vehicle ownership. If it's sold after the first six years, it needs to be smogged again unless smogged within the last 90 days.

But we also have other stupid laws here in CA like no tinted front windows, front plate requirement, etc. :bash:

 

[nated05]

Yea, we have something similar to smog inspections here in the STL area and surrounding 3 counties. Every other year you have to go to a special station and pay $25 so they can plug into your car computer and check your emissions. Plus we have to get a sefety inspection every other year as well. Some people are trying to get rid of the emission testing but so far no luck.

Oh well, what can you do.

 

[pipspeak]

Just like any purchase you pay tax based on where the "item" will be primarily used. For a car, you pay sales tax based on where it will be registered. For any online purchase you're supposed to pay tax based on where the item will be used... but most people don't bother!