Arrwin

Hey guys,

I think I may of found myself the perfect car on the other side of the country in Cali from a private party.

I was wondering how the tax works with purchasing a used car? Is it simply the cost of the car x sales tax rate as a new car? Does it vary from state to state?

I'm in NY and would like to know how much I will be killed in taxes by the state, so if any NY'ers have experience with this that would be even better.

Thanks again fellas.

ca993twin

Its a state-to-state thing, so you need a NY guy to answer this. In California, you declare the price you paid for the car when you go to register it for the first time. It is called a "use tax", but its the same rate as the local (county-wide) sales tax. Your own sense of honesty is your guide when declaring what you paid. Its one advantage from buying from a private party instead of a dealer.

Arrwin

Thanks Steve. I think that's how it works here as well. I'll wait for a NY guy to confirm.

Thanks again!

Labatt

In NY when you go to the DMV to register you pay sales tax at that point. The rate is based on the address given for registration. It's like standard sales tax - you pay based on what the price of the car was. So if the car is $50K, you pay sales tax on $50K. The only time this is different is if you were gifted the car or you paid well below book value, in which case you pay based on book value. I believe when they take the amount you paid and put it in the system it will automatically determine if there's a reason to change the price to book value.

BTW, you have to provide a copy of the bill of sale to prove the price.

nile13

I've paid enough taxes in NY State on used cars

Essentially, you and the seller fill out a yellow form available at your DMV. Amount of money paid is put in there as well. You pay whatever your tax rate (I assume 8%+, but same as sales tax rate on clothing and other stuff) on that amount. Yes, there's a lot of room on that form Bill of sale is optional, I suggest having a hand-written one. In Cali the seller will also put the selling price on the title, so you should make sure that the same number will appear on all 3 documents. Also a Cali thing - another piece of paper that can be used as a bill of sale - a form that they send to their DMV and you get a copy of. And they do detach a part of teh title as well - don;t be surprised, it's normal.

If it's a gift it's not taxed at all in NYS.

Now, this is from several years ago, but I recently heard from a friend that it is still the case in NY.

joey bagadonuts

I've registered a car in NY and the Bill of Sale will help you fly through the process. And if you avoid financing, you'll certainly want to bring the Title along with proof of insurance. Like others mentioned, it's just like sales tax.

Labatt

What to bring to the DMV office:

Proof of Ownership.

Acceptable Proofs of Ownership
Cars, Trucks and Motorcycles - model year 1973 or newer

The acceptable proof of ownership is a title certificate from any state and a bill of sale. The person whose name appears on the proof of ownership must sign the transfer section of the proof of ownership.

If the seller has a title certificate that was transferred to the seller by another person, the seller cannot use that title certificate to transfer the ownership to you. The seller must apply for a title certificate only and transfer the new title certificate to you.

Your name must appear on the title certificate as the buyer.

Make sure that the information listed on the title certificate is not altered, erased or changed. If any information is altered, erased or changed, the current owner must get a duplicate title certificate and use the duplicate to transfer the ownership to you.



Odometer and Damage Disclosure Statements. The previous owner must complete the statements on the back of the NYS title certificate for a vehicle that is eight model years old or newer. If the NYS title certificate was printed before December of 1994, there are no statements on the back of the certificate. The previous owner must complete form MV-103 instead of the statements, and you must take form MV-103 to the DMV office. Get more information about vehicle disclosure statements.

An original New York State Insurance Identification Card (FS-20). After you buy the vehicle, bring the proof of ownership to an insurance agent or broker authorized to do business in NYS, and get the card. The FS-20 must have the same name as the registration application and must have a barcode. The DMV does not accept any out-of-state insurance documents. More information about insurance is available at the DMV Web site.

Proof of your identity and date of birth. You must be 16 years old or more to register a vehicle in NYS.

Form MV-82 (Vehicle Registration / Title Application).

Payment. Bring cash, a personal check, a credit card or a money order to pay the registration fees and sales tax. Do not enter the amount on your personal check until the DMV examines your application.

Proof of sales tax payment, sales tax exemption, or purchase price. You must pay the sales tax, prove that it was paid, or prove your exemption at the DMV office when there is a change of ownership, a lease agreement, or a new resident of NYS applies for a NYS registration or title certificate. You must get a sales tax receipt from the DMV even if the transaction is exempt from sales tax.

If the name of the owner that appears on the NYS title certificate will not change, sales tax forms and proofs are not required. See the information below if you were not a resident of NYS when the vehicle was purchased.
If you bought the vehicle from a NYS automobile dealer or an out-of-state dealer that is authorized to collect NYS sales tax, bring the dealer's bill of sale that shows that you paid NYS sales tax. Also bring form MV-50 (NYS dealer only) or form DTF-803 (out-of-state dealer). If NYS sales tax was paid to a NYS dealer, sales tax is not collected when you apply for a vehicle registration, and the DMV does not issue a sales tax receipt.
If you bought your vehicle from another person in a private sale, both the buyer and the seller must complete form DTF-802. Bring the form to a DMV office. The DMV calculates and collects the sales tax, and issues a sales tax receipt.
If you leased the vehicle, see the information about leased vehicles.
If the vehicle was a gift or was purchased from a family member, use form DTF-802 to receive a sales tax exemption.
If you paid out-of-state sales tax, show the out-of-state dealer bill of sale. The bill of sale must show the purchase price and the amount of out-of-state sales tax paid to the dealer. Use form DTF-804 to claim credit for the state and local sales taxes you paid in the other state. This process can reduce the amount of your NYS sales tax if NYS and the other state have an agreement about sales tax.
If you were not a resident of NYS when the vehicle was purchased, use form DTF-803 to receive a non-resident exemption from NYS sales tax. Form DTF-803 defines the terms "non-resident" and "resident".

Arrwin

Thanks everyone! Looks like there's no way of avoiding the dreaded sales tax, especially with financing.

Thanks again! This board rocks!

nile13

There is a way of reducing it. I will shut up now.

Arrwin

It was just getting good! Please....PM me..