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Discussion Starter #1
If I settle on 25,550 for my new rav, and didnt have a trade, I would pay tax on this whole amount, right? What if I have a trade in of 14,000. Would I only have to pay tax on that difference? I was told by one dealer to be careful of the "tax advantage" He explained it, but I didnt quite understand it. I dont actually have a trade per say. I am turning in a leased vehicle with a payoff of 13,28, but this dealer is willing to give me 14,000 and treat it as a trade. I want to make sure they are not over charging me on tax!! Any help would be appreciated. thanks..
 

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I traded in my Pathfinder for the Rav. I paid tax only on the difference. The Pathfinder was owned. If your trading a leased vehicle, there is generally no tax advantage since you don't own the vehicle (you havn't paid the full tax amount on the purchase price, you only paid tax on the leased amount be it 36 or 48 months for example)
Only if the dealer is willing to pay you more than your buy back will you get a bit of tax savings, but only on that amount.

Hopefully that helped. :)
 

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Discussion Starter #3
Thanks. The payoff for the highander is 13,280 and they are willing to give me 14,000. So I will be paying tax on the whole new rav? The sticker was 26,034. I am paying 25,550 tax included. So what figure am I paying tax on.. the 26,034? This tax thing really has me confused!!!
 

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Your paying tax on whatever they are selling you the vehicle for including all options you chose, etc..
 
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24830 * whatever your tax rate is

that 's 25,550-720 left from you lease return
 

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The answer to this question, especially with a lease, is going to vary by state.

Generally you reduce the taxable amount by the trade-in on a purchase. Don't know what happens when you mix a purchase with a lease trade-in. Depends on how your state applies tax to leases.
 

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Go here to find the link to your state's DMV site. The DMV site should be able to tell you or calculate motor vehicle tax and license fees based on the total purchase price, and answer questions about these fees.

I went to California's DMV site to get an estimate of my t&l fees and an idea of what my final cost will be.
 

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tax

So if you buy a car for 25'000 and your trade-in is worth 10'000 you should only pay tax on 15'000 right???? This is not a lease :roll:
 
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I just bought (leased) a 2006 Toyota RAV4 Sport and I put down $9000 as a downpayment.

Since its a lease, they taxed me on my $9000 downpayment and then taxed my monthly payments. I think this is correct, can anyone confirm?
 
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