Help Me to Better Understand this...

Touge86 · 12-27-2011, 06:18 PM

So if you trade a car into a dealership towards the purchase of a new car, you only pay sales tax on the difference of the trade in value and the purchase price of the car.

BUT

If you sell your car private party, then turn around and buy another car, you have to pay sales tax.

So dealerships have the ability to make you pay less sales tax because they are a dealership? It seems kind of strange because either way you are selling your car and getting a new car. So why does it going through a dealership change anything in regards to what the government collects from you?

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zizux · 12-27-2011, 06:36 PM

It has nothing to do with the dealership part. Has to do with the purchase price. Purchase price is lowered when you trade in by the value of your trade.

You can in fact trade in to a private party, same rules apply.

Touge86 · 12-27-2011, 06:40 PM

The Dealership doesn't mark the vehicle sale price to the amount of the agreed sales price and then subtract the trade in. Paperwork still shows a sales value on the car and on the trade in.

So if can trade in to a private party, where would you get the paper work? Everything I found via the DMV shows that only a dealership can do that. Or are you saying you can pay the doc fees at the dmv and trade into a private party via the dealership?

Euclid · 12-27-2011, 11:37 PM

You go through the dealership. When you find a buyer for the car the dealership handles all the documentation.

aclver1 · 12-28-2011, 11:26 AM

What car are you getting now? Ask Ryan, Sleepy Subie, he has his dealers license.

godfather2112 · 12-28-2011, 12:04 PM

They figure they are already raping you enough.

Lil' Biggie · 12-28-2011, 02:10 PM

Quote:

Originally Posted by Touge86

The Dealership doesn't mark the vehicle sale price to the amount of the agreed sales price and then subtract the trade in. Paperwork still shows a sales value on the car and on the trade in.

You only pay sales tax on the sale amount, the difference between the trade in and the sales price.

Quote:

Originally Posted by Touge86

So if can trade in to a private party, where would you get the paper work? Everything I found via the DMV shows that only a dealership can do that. Or are you saying you can pay the doc fees at the dmv and trade into a private party via the dealership?

There is no paperwork. You go into the DMV with your bill of sale that says you traded for an equally priced item and they will charge you no sales tax. It doesn't even have to be a car, just something you have already paid sales tax on.

Touge86 · 12-28-2011, 03:25 PM

^Thanks Biggie.

12-27-2011, 06:18 PM	#1
Touge86 Scooby Guru Member#: 166498 Join Date: Dec 2007 Chapter/Region: International Location: Utah Vehicle: 2013 FRS SWP	Help Me to Better Understand this... So if you trade a car into a dealership towards the purchase of a new car, you only pay sales tax on the difference of the trade in value and the purchase price of the car. BUT If you sell your car private party, then turn around and buy another car, you have to pay sales tax. So dealerships have the ability to make you pay less sales tax because they are a dealership? It seems kind of strange because either way you are selling your car and getting a new car. So why does it going through a dealership change anything in regards to what the government collects from you? * Registered users of the site do not see these ads.

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12-27-2011, 06:36 PM	#2
zizux Scooby Specialist Member#: 199836 Join Date: Jan 2009 Chapter/Region: RMIC Location: South Jordan, UT Vehicle: 2011 STi DGM	It has nothing to do with the dealership part. Has to do with the purchase price. Purchase price is lowered when you trade in by the value of your trade. You can in fact trade in to a private party, same rules apply.

12-27-2011, 06:40 PM	#3
Touge86 Scooby Guru Member#: 166498 Join Date: Dec 2007 Chapter/Region: International Location: Utah Vehicle: 2013 FRS SWP	The Dealership doesn't mark the vehicle sale price to the amount of the agreed sales price and then subtract the trade in. Paperwork still shows a sales value on the car and on the trade in. So if can trade in to a private party, where would you get the paper work? Everything I found via the DMV shows that only a dealership can do that. Or are you saying you can pay the doc fees at the dmv and trade into a private party via the dealership?

12-27-2011, 11:37 PM	#4
Euclid Scooby Specialist Member#: 41846 Join Date: Aug 2003 Chapter/Region: RMIC Location: Salt Lake Vehicle: both 05 LGT, 08 STI black and white	You go through the dealership. When you find a buyer for the car the dealership handles all the documentation.

12-28-2011, 11:26 AM	#5
aclver1 Scooby Specialist Member#: 114177 Join Date: May 2006 Chapter/Region: RMIC Location: SLC utah Vehicle: 2004 Impreza 2.5rs 70 Datsun Fairlady	What car are you getting now? Ask Ryan, Sleepy Subie, he has his dealers license.

12-28-2011, 12:04 PM	#6
godfather2112 doesn't like pears Moderator Member#: 53794 Join Date: Jan 2004 Chapter/Region: RMIC Location: utah Vehicle: .... Just call me Papi Chulo	They figure they are already raping you enough.

12-28-2011, 03:25 PM	#8
Touge86 Scooby Guru Member#: 166498 Join Date: Dec 2007 Chapter/Region: International Location: Utah Vehicle: 2013 FRS SWP	^Thanks Biggie.