Out-of-State car purchasers pay tax twice?!
 

Hi all.

I live in Vegas, and I've been frantically researching to buy a new 370Z in the New Year in fits of boyish excitement. Most of the cars I see are over in SoCal. But my father-in-law tells me that if I buy a car over in Cali, I'll have to pay tax on the purchase TWICE - once over there and then again to Nevada when I come to registering it.

Now, that seems completely ridiculous to me, but having just moved to the US from UK in April this year, if an American tells me something about America, I tend to take on board what they tell me until another trusty American (or a few) informs me otherwise. :)

You guys are those trusty Americans. :bowrofl:

So, at the risk of looking like a complete idiot, I thought I'd ask you guys if that's true. Because if it is it seriously stamps out the option of buying in Cali, which massively reduces my options (especially considering I've been speaking to a dealership over there who seem perfectly happy with talking invoice pricing with me).

Oh, and this is my first ever thread - sorry if its a repeat or there's a better place for it. I had a quick search beforehand.

Thanks in advance, everyone.

Sounds wrong to me. I live in Indiana, but generally buy my cars in Kentucky. When I buy a car in KY, I pay Indiana taxes.
There may have to be a reciprocal tax agreement between states. I'm not really sure about that. Your best bet would be to call your local license branch and maybe one in the other state.


(we only charge Brits double tax. Still making up for the Tea Tax. I keed!) :)

You will not pay tax twice. You will only pay tax where you register the car. (your home address on your ID)

For example, if you buy a Z in Cali, you will only pay the price of the car + title + fees (if there are any). Your home address on your drivers license will prove you do not live in Cali, there for they cant charge you state or city tax.

Once you bring the car home, you will take it to the MVD where they will make you pay tax + registration.

The only problem you may have, is acquiring a temp tag to get the car home, if you plan to drive it home. The best way to do this is to use the internet at the dealership and log on to your states MVD website and print a temp tag to drive home on. Option B would be to have the car shipped home but thats like four to seven hundred dollars.

Good luck, Im in the same boat as you so I know how it is, all the good Z's are in cali, and im further away in Phoenix! :shakes head:

Ahhh... phew. I can't tell you how much of a relief it is to hear that. Thanks JBZ34!:tiphat:

As for the tag - I spoke to the dealership in Cali (who told me pretty much what you did, but vice versa - he said I'd pay tax in Cali, not in Nevada, although he sounded like he was just guessing so I'm going with your word), and they said they can fix me up with a single-day/single-journey pass of some sort so I can drive it home without issue. To be honest, that's the route I'll definitely take, because driving it home, after obsessing over this car for over a year now, will be a glorious moment for me. You have NO idea!!

Thanks again, and good luck to you too. Maybe see you at a meet next year then, if all goes to plan!

Haha, alright well I'll have relatives send you some REAL English tea tax-free. ;) But wait, isn't this the land of coffee anyway? No one I know here gives a **** about tea except my wife, who I've managed to turn in the past few months. Thanks for the feedback, man. :)

agreed with JBZ34. i purchased my car in another county that has a higher tax rate. when i signed the paperwork, i saw the taxes were charged at the higher rate. i had to correct the salesman and tell him that the car will be registered at my home address, which has a half percent lower tax rate. he had to reprint the paperwork, but i would assume they would have to do the same if you purchased the vehicle out of state.

Oooh. No. I likes me some tea. Only reason I drink coffee is to stay awake. Been to Starbucks one time in my entire life...To get coffee to stay awake.

no prob OP, good luck to you!!!

Bought my car last week in louisiana, but registered it in Tx. Paid sales tax and registration fees for texas. Paid no taxes in Louisiana. You will get a cali temp tag i assume cause i get one from La until my plates show up. Just make sure the dealership files for the title correctly in your state and that you know what your sales tax is for your area.

Oh, in SoCal we call it DMV (dept of Motor Vehicles) .... Not MVD!! :)

just in case you try googling it. :)

If you're driving it off the lot.. PLEASE make sure you have insurance that covers that car, whether purchased through the dealership, or that you've arranged your current insurance to cover the new car.

Would hate to have some incident on the way back or before you let everyone know youv'e got the car and have an issue.. even not your fault.. unfortunately we're known for having uninsured drivers in CA.. :/

Just saw this post from a california dealer on the corvette forum, having a sale on ZR1s. This was at the bottom:

Out Of State Buyers pay no fees. If you would like to fly in and drive the car home, you will have to pay 9.25% California sales tax. You can have the car shipped from our dealership to your state and you won't have to pay the 9.25% California sales tax. You will be responsible for shipping, registering, and paying the sales tax in your own state

I seem to recall that when I was in the military and lived in CA but was a florida resident, anytime I bought a car, I paid CA sales tax, and then FL would waive the difference between the two when registering, but it was always zero because CA taxes are higher then FL.

Mike beat me too it. California sales tax is high. You might be better off shipping it so you only have to pay your state sales tax. (South Carolina max is $300 for automobiles :ughdance:) Property taxes will always be paid in your home state.

+1 You nailed it. I asked, too, lol

Mike is correct, you pay tax where you register the car.

^^^^^Agreed! But just buy it from Lou and have it shipped to you. You will get a better deal anyway. :)

Josh has a good point too. Most insurance plans cover the purchase of a new vehichle for a certain amount of time on your current policy... but I never trust that and have always called my agent with the VIN before hand so that they have record of my intentions/purchase. Plus VA DMV asks you on the registration form if the car is currently insured. If they find a poloicy date after the date of registration, you won't be a happy camper. Happened to a friend of mine and he was fined and still has to maintain proof on insurance with the state.

I just went through something similar. Big pain in the *** but it all worked out. So I bought my Z in New Jersey. While at the dealer I was getting ready to sign and noticed they were charging 9% sales tax....this set off alarms in my head. When i asked it was "to cover oursleves in case you register the car in a state that has a higher tax and we dont want to get stuck paying the difference." I still questioned them because i opted for the dealer to register the car themselves in Virginia (where i lived at the time. Im military so i move quite a bit). Probably would have been easier to just register the car myself and save me the hassle. Anyway, they ended up sending all the info to the Virginia DMV (tax in VA is 3%). After Virginia reviewed all the paperwork and sent the plates to the dealer, they also included information about the VA tax only being 3%. Long story short, the dealer reimbursed me 6% tax on the purchase. Confusing I know...but like i said it all worked out in the end! If you have any more questions feel free to shoot me a PM.

Thanks for all you guys' help.

This...

...and this...

...make perfect sense - basically, I buy the car in Cali, I'll pay Cali tax, which is higher than the tax in my state, Nevada. And in that case I might be better off paying shipping (or just waiting to buy one in Nevada) so that i only pay NV tax. Right?

But then this...

...seems like a conflicting statement. I'll be registering the car in Vegas, because that's where I live. Sooo... I pay Nevada tax?

And this...

...says to me the dealer will want to charge me Cali tax, but so long as I point out that the car will be registered in Nevada, they'll charge me NV tax (or reimburse the difference after the sale goes through).

Sorry, am I being a dumbass? It doesn't seem clear.

Oh, and don't worry Josh - I won't be taking any chances with insurance for my precious Z. :tup:

Correct. You should get reimbursed if the tax in NV is less than the tax they charge you after the registration process is complete.

no, with california and nevada, its basically if you buy it in california and take delivery in california, you pay california sales tax. If nevada sales tax is lower, you will pay no additional tax when you register it, but you won't get a refund either. If nevada tax is higher, you will pay the additional tax that is the difference between what you already paid and what you would have paid in nevada.

hmmm that doesnt seem right. ive talked to many friends who have bought cars in different states (not necessairly NJ and registered in VA) and they have been reimbursed if the tax where they register the car is lower... did a quick search and found some info from NV.

"Buying A Vehicle - Out-of-State Dealer Sales
Out-of-state vehicle dealers must comply with their own state's laws regarding sales to non-residents. Ask about a movement permit and for details on how the vehicle will be titled before you buy. Be certain to read and understand the sales or lease contract before signing. An out-of-state dealer may or may not collect sales tax. The Nevada DMV will verify whatever tax was paid and charge the buyer any difference between that amount and what would have been due in Nevada. See the Nevada Department of Taxation Sales and Use Tax Publications for current tax rates. Rates vary by county.

You must register the vehicle at a DMV Full Service Office before the expiration date of any movement permit issued or 30 days maximum. Please bring all documents provided by the dealer. You must have:

Invoice or Bill of Sale, and one of the following:
Title
Manufacturer's Certificate of Origin
Security Agreement
Lease Agreement
Purchase Order
Nevada Evidence of Insurance Card
Nevada Emissions Vehicle Inspection Report if needed
VIN Inspection
Application for Vehicle Registration (VP-222)"

Straight from NV DMV site.

I guess im interpreting this as they can possibly reimburse you if the tax is lower than what they charge you in CA...?

I'm late to the party, but I bought my Mustang from FuszNissan in St. Louis. I paid sales tax on the car when I registered it in my home state (Virginia) and that was it.

Just make sure you check your state laws to see how long you're legally allowed to drive the car in state before you register it. In VA I had 30 days, which I think is the norm.

Yeah I called and spoke to another LA-based dealership and this is pretty much what they told me. This sounds about right - cool. Thanks guys.:tiphat:

At least the good news still stands - I DON'T have to pay tax twice.

Me: 1 - Father-in-law: 0.

(Actually he turned out to be right with his claim that vitamin C evaporates from orange juice if left uncovered, which sounded utterly ridiculous to me, so I guess it's 1-1). :tup:

hmmm this is all quite interesting as I will be going to cali and buying my car... then having it shipped to hawaii!

But if you go to Lou to pick up the car he will buy you breakfast. :tup:

Out of State Purchase , California/Nevada
 

I just did this. The law now works likes this. You pay the state tax for where you buy the vehicle. If the tax is the same or higher than Nevada, there is no issue. But, if where I buy the car is less than Nevada, I have to pay the difference. In my case, Cali taxes are higher than Nevada, so I owed nothing. The deal I got on the car made of for the extra 1.75% extra I paid in taxes. Plus, I got them to reimburse me for the plane ticket to fly from Reno to Orange County. All in all I am super happy with everything. :rofl2:

I live in CA. bought a car in IL., paid 6.2% IL tax, registered it in calif. and had to pay difference in state taxes.belive CA ends up with the entire amount, IL. forwards it.

The term to look for is "reciprocal tax", where two different states could have completely different rules. Best is to call DMV and not rely on dealer, since all they want to do is complete the deal as fast and possible.

I just bought a car in Illinois and had it shipped to me in Ga. When I took my paperwork to the tag office, I paid the tax on the car then. After the tax was paid, I was able to register the car in Ga. Since the car was used, I was taxed on the Ga value, not what I paid.

So... Did you come out ahead :ugh2:

Oh Yes, 1 large ahead.

Tax
 

I live in Michigan. Flew to Minneapolis and bought 2016 ZSport.

No taxes.

Got the title in mail. Went to MI Secretary of State to register car and get plate.

Had to pay purchase tax $1600. Then got new MI title upon transfer and registering.

I bought my C4 in IL and had it shipped. IL charged me 6.25% and when I registered in CA CA charged me the difference up to 9.25%