New Tax law on used cars, what are your thoughts?
09-27-2006, 12:04 PM
#1
On The Tree
Thread Starter
iTrader: (6)
Join Date: Oct 2002
Location: Lufkin, Texas
Posts: 140
Likes: 0
Received 0 Likes
on
0 Posts
New Tax law on used cars, what are your thoughts? This starts Monday.
Used vehicle buyers will have to pay more taxes
By CHRISTINE S. DIAMOND
The Lufkin Daily News
Tuesday, September 26, 2006
Used vehicle buyers have until Monday to pay vehicle sales tax at a purchase price 80 percent less than its retail value.
Beginning Monday, vehicle owners will be charged a sales tax registration fee based upon "standard presumptive value," said Angelina County tax assessor Bill Shanklin. "If I buy a 2003 Buick from you and pay $5,000 for it, and go to the tax office to register it and (they say) it's valued at $8,000 — I have to pay sales tax on $8,000."
Unless, Shanklin said, he goes to a certified dealer or insurance appraiser who gives an estimate, on a form prescribed by the state comptroller's office, that says the vehicle is worth less than $8,000 — but this service can cost up to $300. House Bill 4, according to a state memo sent to Shanklin's office, mandates auto dealers charge "no less than $100 (and) up to $300; motorcycles starting at $40; a travel trailer appraisal may be up to $500."
Insurance appraisers are free to set their own charges.
As the amount of tax paid is 6.25 percent of either the sale price, if it is the higher amount, or 80 percent of the standard presumptive value — if the difference in taxable value is exceeds $300, it may be worth the paid estimate.
"What they are trying to do is stop the lying about what (people) say they paid for it," Shanklin said.
Creators of the new tax strategy hope to net $30 million to $43 million a year.
"This is part of the education tax reform package that is supposed to lower the rate of your school district," the state's memo stated.
Buyers of trucks, trailers, campers, motor homes, motorcycles, and dollies will be taxed the same way, the memo states. But not boats, Shanklin said.
And the new procedure only applies to private-party, non-dealership sales.
Standard presumptive value data will now be available on the Texas Department of Transportation Web site, www.txdot.gov.
A buyer has 20 days to register his new acquisition with the local tax assessor's office, at which time the sales tax is assessed and collected.
Used vehicle buyers will have to pay more taxes
By CHRISTINE S. DIAMOND
The Lufkin Daily News
Tuesday, September 26, 2006
Used vehicle buyers have until Monday to pay vehicle sales tax at a purchase price 80 percent less than its retail value.
Beginning Monday, vehicle owners will be charged a sales tax registration fee based upon "standard presumptive value," said Angelina County tax assessor Bill Shanklin. "If I buy a 2003 Buick from you and pay $5,000 for it, and go to the tax office to register it and (they say) it's valued at $8,000 — I have to pay sales tax on $8,000."
Unless, Shanklin said, he goes to a certified dealer or insurance appraiser who gives an estimate, on a form prescribed by the state comptroller's office, that says the vehicle is worth less than $8,000 — but this service can cost up to $300. House Bill 4, according to a state memo sent to Shanklin's office, mandates auto dealers charge "no less than $100 (and) up to $300; motorcycles starting at $40; a travel trailer appraisal may be up to $500."
Insurance appraisers are free to set their own charges.
As the amount of tax paid is 6.25 percent of either the sale price, if it is the higher amount, or 80 percent of the standard presumptive value — if the difference in taxable value is exceeds $300, it may be worth the paid estimate.
"What they are trying to do is stop the lying about what (people) say they paid for it," Shanklin said.
Creators of the new tax strategy hope to net $30 million to $43 million a year.
"This is part of the education tax reform package that is supposed to lower the rate of your school district," the state's memo stated.
Buyers of trucks, trailers, campers, motor homes, motorcycles, and dollies will be taxed the same way, the memo states. But not boats, Shanklin said.
And the new procedure only applies to private-party, non-dealership sales.
Standard presumptive value data will now be available on the Texas Department of Transportation Web site, www.txdot.gov.
A buyer has 20 days to register his new acquisition with the local tax assessor's office, at which time the sales tax is assessed and collected.
09-27-2006, 09:42 PM
#4
TECH Addict
Join Date: Dec 2001
Location: Cypress, TX
Posts: 2,264
Likes: 0
Received 0 Likes
on
0 Posts
Doesn't surprise me. This reminds me of the inheritance laws that are about to change. It's almost double taxation (or triple or more depending on how many times the car changes hands). Now parents can't give cars to their kids because the kids will have to pay tax on the full value if they want it in their name. Utter bullshit if you ask me.
Of course, I say this now. Let's see how much my school taxes go down.
Of course, I say this now. Let's see how much my school taxes go down.
09-27-2006, 09:43 PM
#5
TECH Addict
Join Date: Dec 2001
Location: Cypress, TX
Posts: 2,264
Likes: 0
Received 0 Likes
on
0 Posts
Originally Posted by 91Z28
That pisses me off. I've saved a few grand by having the sellers put a low price on the bill of sale.
09-27-2006, 09:56 PM
#6
Gifts are not subject to the new tax law.
As best I can tell, the tax law screws the guy buying the beater. If you are buying a decently equipped model in good condition, the appraised value is pretty fair, but if you are getting the work truck model thats been beat up for years, you will likely pay more than you should.
This of course assumes that you would have actually put the real sale price on the bill of sale in the old days.
As best I can tell, the tax law screws the guy buying the beater. If you are buying a decently equipped model in good condition, the appraised value is pretty fair, but if you are getting the work truck model thats been beat up for years, you will likely pay more than you should.
This of course assumes that you would have actually put the real sale price on the bill of sale in the old days.
Trending Topics
09-27-2006, 11:52 PM
#9
TECH Resident
Join Date: Jul 2005
Location: Midland
Posts: 861
Likes: 0
Received 0 Likes
on
0 Posts
Originally Posted by CySevans
Well, by their logic, you've stolen a few grand in taxes from them. They consider this tax evasion and fraud. Best not to admit to this on a public forum.
