Sales Tax?? Out of State Purchase.

[dave1949]

I just bought a new 2015 Ford F250. I had to pay sales tax on the sticker price, NOT the sales price, figure that one out...

https://www.dmv.virginia.gov/vehicles/#sut.asp
Effective July 1, 2014, unless exempted under Va. Code § 58.1-2402, Virginia levies a 4.05% Motor Vehicle Sales and Use (SUT) Tax based on the vehicle's gross sales price or $75, whichever is greater. An additional $64 fee applies to electric vehicles, excluding mopeds.
For the purposes of the Motor Vehicle Sales and Use Tax collection, gross sales price includes the dealer processing fee. The gross sales price is the vehicle price after the manufacturers' rebates or manufacturers' incentives. Gross sales price does not include any other price reductions, such as credit for trade-ins, unpaid liens or other unpaid credits.

 

[thatguy]

A couple things to consider.. 1) you do owe the tax as mentioned via 'use tax' if the seller doesnt collect it. unless the dealer is audited by YOUR state dept of tax they probably wont know about your purchase.

2) Even if you buy it out of state and its delivered to you tax free - IF you financed the tractor the dealer may file a lean with the State Corporation Commission in your state (? called a UCC lien maybe), when they do that the Dept of Tax could/may get a copy of that and inquire about tax payment

brian

 

[Threepoint]

True fact. Some states attach sales tax to out of state vehicle sales during registration, but since you're not doing that, no tax!!

Jay, since you live in New Hampshire, this would be true in your case, as NH has no sales or use tax. It is quite different for the OP, who lives in PA.

 

[Tractor Seabee]

Here in WA we live next to two states with no sales tax (OR & ID) so this goes on all the time. WA law says you pay the tax if bought out of state. Dealers from OR & ID who have branches with a business license in WA have no choice but to collect it. Their primary enforcement is whistle blowers who get a finders fee. WA also has an annual excise tax on the depreciated value of equipment depreciated over more than the original purchase year. Applies to individuals and to businesses equally. Businesses are stuck as eventually the county (enforcement agent) will catch it on an audit using IRS records as a base document to establish ownership because of depreciation schedules. Bona Fide Farmers have to have a business license and file IRS schedule F. On businesses they get down to the small office equipment such as filing cabinets and desks. Individuals w/o a business license usually escape unless being audited for some other reason or a disgruntled neighbor whistle blower. The TAX MAN at work. WA is not a business friendly state. Business and Occupation (B & O)Tax is levied annually on your gross receipts whether you make a profit or not.

Ron

 

[namesray]

Wow, lots of good experiences and info here. Thanks for all the info.

I too believe we mostly all just conform to a out of control goverment when it comes to issues like this. Mostly because we live in fear of what our goverment authorities could do to us, so a lot of people just do what the goverment wants, then in return our goverment thanks us all by passing more and higher tax laws in the future. It will never stop until we as americans as a whole stand together and say enough is enough, but our goverments know that the chances of that happening is almost non existent, so we all continue in this downward spiral.

As for me and if I go through with this out of state purchase, first I am going to check into the rules for an agricultural exemption. I do own some property, with pastures and horses, and also "harvest" firewood commercially to sell, so there might be a chance, but I doubt it.

The tractor is going to be used in a business setting (firewood and bushhogging), and even though I am against all these taxes, I feel in my situation I'll go by the old saying, "o what a tangled web we weave, when at first we practice to deceive." I can just see if I tried to forget the sales tax, it would eventually catch up to me and I would be in a 10 times bigger mess.

So there, I just gave a prime example of why the goverments will just keep rolling over us and that we as americans will never all stand together and say enough is enough.

If anyone has any info on ag exemption in pennsylvania, I would greatly appreciate a "point in the right direction" Thanks.

 

[GManBart]

If anyone has any info on ag exemption in pennsylvania, I would greatly appreciate a "point in the right direction" Thanks.

Looks like it's current:

http://www.dmv.state.pa.us/pdotforms/fact_sheets/revenue tax info for farmers.pdf

 

[cford36]

I just bought a new 2015 Ford F250. I had to pay sales tax on the sticker price, NOT the sales price, figure that one out...

You pay sales tax on the negoitated price BEFORE taking the rebates off. If the price you paid before rebates was the sticker then that is correct. (Not sure why you would pay sticker price)

Rebates are cash back after sale. You can either take them in cash or apply them to the sale. That is why you pay tax on them. Yeah sucks, but better than no rebates.

At least this is how NY handles it. Hard to believe any other state can figure out how to suck any more money out of you than NY.

 

[lamanated]

I had a conversation with atransportation broker about out of state sale.and having to do the sale at the border at a notary, he said, the seller just had to fill out a bill of lading on it.. I'm seeing him in a few weeks, so will get the details on what you need to do ,

 

[Threepoint]

You pay sales tax on the negoitated price BEFORE taking the rebates off. If the price you paid before rebates was the sticker then that is correct. (Not sure why you would pay sticker price)

Rebates are cash bask after sale. You can either take them in cash or apply them to the sale. That is why you pay tax on them. Yeah sucks, but better than no rebates.

At least this is how NY handles it. Hard to believe any other state can figure out how to suck any more money out of you than NY.

It's a little different in VA now. The VA motor vehicle sales/use tax explicitly nets out manufacturer's rebates and incentives. It's one of the concessions the dealers won in the run-up to increasing the tax from 3 percent to 4.05 percent last July 1. So, for example, if the price of the vehicle before any credit for a trade and lien payoff is $20,000, and the buyer gets a $1,000 rebate from the manufacturer, the tax is on the $19,000. The tax rate will tick up again slightly on July 1 of this year, and again on July 1, 2016.

In Steppenwolfe's case, I too am not sure why the sales tax was calculated on the sticker price, unless the final negotiated price was in fact the sticker price before any trade or lien payoff, and there was no manufacturer's rebate or incentive involved. :scratchchin: That certainly could be the case.

 

[dave1949]

It's a little different in VA now. The VA motor vehicle sales/use tax explicitly nets out manufacturer's rebates and incentives. It's one of the concessions the dealers won in the run-up to increasing the tax from 3 percent to 4.05 percent last July 1. So, for example, if the price of the vehicle before any credit for a trade and lien payoff is $20,000, and the buyer gets a $1,000 rebate from the manufacturer, the tax is on the $19,000. The tax rate will tick up again slightly on July 1 of this year, and again on July 1, 2016.

In Steppenwolfe's case, I too am not sure why the sales tax was calculated on the sticker price, unless the final negotiated price was in fact the sticker price before any trade or lien payoff, and there was no manufacturer's rebate or incentive involved. :scratchchin: That certainly could be the case.

I think this is why: (from VA state site posted earlier)
"For the purposes of the Motor Vehicle Sales and Use Tax collection, gross sales price includes the dealer processing fee. The gross sales price is the vehicle price after the manufacturers' rebates or manufacturers' incentives. Gross sales price does not include any other price reductions, such as credit for trade-ins, unpaid liens or other unpaid credits."