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  1. #1
    Gold Member
    Join Date
    Aug 2008
    Posts
    264
    Location
    ElDorado,AR
    Tractor
    Ford 4000 diesel

    Default sales tax question

    I was wondering what the rules are as far as having to pay sales tax on a new tractor from out of state? In Arkansas you have to pay sells tax on a new tractor but not a used one. The two closest states are TX and LA does anyone from either state know your states sales tax rules?? I have paid alot of sales tax on fourwheelers and used vehicles to feel bad about trying not to pay AR sales tax on a tractor. If you have a farm you don't have to pay sales tax but I don't have a farm. Sales tax adds up to another $1500 or so. That makes the tractor cost some more.

    Thanks Matt

  2. #2

    Default Re: sales tax question

    Unless you have to register with the state with some type of license for the tractor, how would they know? Besides if you have enough land and engage in farming activities, you should get some type of exemption from the state. I just got my exemption fron the state of TN for registering my property as part of the Greenbelt. It reduces the property taxes and exempts you from sales taxes on things you by to farm or maintain the land.

  3. #3
    Platinum Member
    Join Date
    Feb 2004
    Posts
    947
    Location
    15 mi. N. of Winchester VA
    Tractor
    CK30HST

    Default Re: sales tax question

    I have read here I think that if you get a bank loan for the tractor, the bank reports the sale for tax purposes.

  4. #4
    Elite Member SnowRidge's Avatar
    Join Date
    Jul 2003
    Posts
    3,091
    Location
    East Tennessee
    Tractor
    Power Trac PT-425 / Branson 3520

    Default Re: sales tax question

    Quote Originally Posted by mike5.56 View Post
    Unless you have to register with the state with some type of license for the tractor, how would they know? Besides if you have enough land and engage in farming activities, you should get some type of exemption from the state. I just got my exemption fron the state of TN for registering my property as part of the Greenbelt. It reduces the property taxes and exempts you from sales taxes on things you by to farm or maintain the land.
    You got a farm sales tax exemption just by putting your property in the greenbelt program?

  5. #5
    Elite Member
    Join Date
    Mar 2005
    Posts
    2,615
    Location
    Bedford, VA
    Tractor
    John Deere 2320

    Default Re: sales tax question

    Quote Originally Posted by mrutkaus View Post
    I have read here I think that if you get a bank loan for the tractor, the bank reports the sale for tax purposes.

    From my understanding - IF you finance it thru the mfg they will also file a lien with the State Corportation Commision (at least that is what they call it here in VA) that will also trigger a review to see if you pay the sales tax..

    In VA a few yrs back the Dept of Taxation did a desk audit of all exempt forms completed for tractor sales through Virginia dealerships.. The letter stated 'prove this was for actual agricultural use or pay the tax as indicated within this letter'. They collected quite a bit of sales tax this way, it seems that anyone with a yard would be willing to sign the exempt form to get out of the sales tax.

    Brian
    Bedford, VA
    2320 w/ 62D MMM, 200CX FEL, Pats EZ Change, LX4 Cutter
    Co-owner (with my father) of John Deere 790, 30 HP, 4x4, 513 cutter, 70 FEL
    2012 Nissan Xterra Pro-4x

  6. #6
    Super Star Member
    Join Date
    Oct 2004
    Posts
    16,854
    Location
    First organized permanent settlement in the northwest territory
    Tractor
    2003 Kubota BX1500/2004 Kubota Bx23/2005 Kubota BX1500

    Default Re: sales tax question

    Quote Originally Posted by mike5.56 View Post
    Unless you have to register with the state with some type of license for the tractor, how would they know? Besides if you have enough land and engage in farming activities, you should get some type of exemption from the state. I just got my exemption fron the state of TN for registering my property as part of the Greenbelt. It reduces the property taxes and exempts you from sales taxes on things you by to farm or maintain the land.
    Must B nice.
    Tractors 2003 Kubota BX1500 / 2004 Kubota Bx23 / 2005 Kubota BX1500.
    Attachments 60'' Front Blade/48'' Rear Tiller/FEL/Back Hoe /
    60'' MMM/Clamp on Forks/48'' MMM
    South of Canton Ohio L .B

  7. #7
    New Member
    Join Date
    Jul 2008
    Posts
    15
    Location
    Near Myrtle Beach, SC

    Default Re: sales tax question

    Not sure if you want to travel this far, but South Carolina has a $300 cap on vehicle taxes. Doesn't matter if it's a $20k tractor or a $400,000 Bently, $300 is all you pay. Nice huh? Of course they get you on property taxes, but only on vehicles that must be registered/tagged. Tractors are exempt. However, if you have a farm number, there is no state tax.

  8. #8
    Gold Member
    Join Date
    Aug 2008
    Posts
    264
    Location
    ElDorado,AR
    Tractor
    Ford 4000 diesel

    Default Re: sales tax question

    Well in Arkansas we pay sales tax on the full amount there is not a cap on the amount you pay. We also pay sales tax on used vehicles atvs boats etc, until whatever it sells falls below 2500 dollars. So the state gets extra tax money on used vehicles that have already had sales tax paid when it was bought new. Bill Clinton is who we have to thank for this in the state of Arkansas. We also pay personal property taxes on just about everything. Farm use is about the only way to get out of paying sales tax. I need a farm, I would have alot of stuff wrote up as farm use.

  9. #9
    Gold Member
    Join Date
    Oct 2007
    Posts
    342
    Location
    North Texas
    Tractor
    John Deere 5203

    Default Re: sales tax question

    In Texas if it is for farm use, there are no taxes.
    JD 5203, 522 FEL, 6' Bush Hog, 8' Land Pride Disk, 78" Box Blade

  10. #10

    Default Re: sales tax question

    Yes, it's one of the items required to qualify. The application in section 9 states that the applicant must meet at least one of the folowing to qualify. The choices are:

    1. the owner or lessee of ag land from which at least $1000 or more were produced or sold.
    2.The business of providing for hire custom ag services for plowing planting etc.
    3.The owner of the land that qualifies for taxation under the provisions of the Ag Forest and Open Space Land Act of 1976
    4.Have a Fed income tax return that contains a schedule F or form 4835
    5. Otherwise establish to the satisfaction of the Commissioner of Revenue that the individual is actively engaged in the business of producing and harvesting ag commodities.

    I qualify under two of the criteria, 1 and 3, but only one is required.

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