Quote:
Originally Posted by xravexboix
This one is probably a dumb question, but are you charged sales tax when you lease a vehicle, or just when you buy the car out? If it is the latter, is the sales tax assessed on the actual purchase price of the vehicle or what the car cost new?
You are charged sales tax ON THE MONTHLY PAYMENT. So that $249/month advertised price you see for a lease from any manufacturer is $249 +tax. You save on tax this way if you think you won't buy the car out. You're only paying tax on the portion of the car you use. You're not paying tax in the residual unless you buy it out. This may vary by state though... this is at least true in California.
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Actually, this depends on state, as I just learned recently. I moved from NJ to FL last spring (2 months after getting my lease), and noticed that my current lease payments jumped up as soon as I registered the car down here.
As it turns out, in NJ, you pay for the entire lease's sales tax as part of your down payment. In Florida, you pay tax on each payment. Since I already paid all of the sales tax to NJ for the life of the lease, I have to fill out a refund form to get back the sales tax NJ charged me for all of the months the car is registered in FL.
In my case, it's kind of cool, because that means I get a check for 34 months' worth of tax that I don't actually finish paying to the state of FL until the lease is over in another ~2 years.