Tax breaks - loan guys - please chime in

[PureStang]

I am about to bite the bullet on a 2013 Mustang. I already have spoken to a sales person and a test drive. During that 45 min span, we have agreed upon $100 over invoice, though i'm sure there is room for more negotiation if they really want the sale.

Next step is to see if I want to trade my car or private sell, and negotiation if i trade it in. I am using $23,000 as a private sell base point (just playing with numbers here, so please bear with me).

I am assuming a 2.9% apr. With a private sale, my goal monthly payment is 326.89 and used that to figure out the my "trade in" value.

Can someone confirm my table to see if I am in the ball park as to how the tax breaks work? If I don't have to go thru the hassle of private sell.

 

[PureStang]

Nothing?

 

[s_x_i]

You're right on how the taxes work.

If you buy a car for $30k you pay taxes on $30k
If you buy a car for $30k with a $18k trade in, you'll pay taxes on $12k regardless of whether there's a lien on the car.

What you have to decide is if it's worth the pain in the ass to sell privately. You'll net more money, but pay more in tax.

 

[PureStang]

You're right on how the taxes work.

If you buy a car for $30k you pay taxes on $30k
If you buy a car for $30k with a $18k trade in, you'll pay taxes on $12k regardless of whether there's a lien on the car.

What you have to decide is if it's worth the pain in the ass to sell privately. You'll net more money, but pay more in tax.

Thats exactly what I'm trying to figure out, trade in or private sell, and at what GTI value where it wont matter

 

[oldmodman]

It might be worth a trip to a no sales tax state to save some cash.

I have bought a few cars in Oregon and saved 10% on taxes each time.
I just never register the cars in California.

 

[N2DAMYSTIC]

It might be worth a trip to a no sales tax state to save some cash.

I have bought a few cars in Oregon and saved 10% on taxes each time.
I just never register the cars in California.

You must claim residency in Oregon do do that correct? Around here they just charge you the tax you would have to pay for your respective state.

 

[oldmodman]

No. I just buy the car in Oregon and drive into Nevada and register it there.

I own property in Nevada so it is all perfectly "legal"

And if I want I can even register it later in California and still pay no sales tax. But I have been leaving the cars registered in Nevada since the is no smog check or inspection either.

 

[PureStang]

Doesnt matter in PA i believe...when you go to register the car, they charge you sales tax if it is bought out of state