hi all.

What is the policy here? i would hope its before taxes are applied.


thanks all !

 

Not 100 % sure but I think its before tax

 

Depends on your State. Most cash incentives/rebates are applied AFTER taxes. Read this article. http://couponing.about.com/od/automo...artaxfacts.htm

 

Trade-in equity, rebates, and deposits are taken off AFTER sales tax is computed and added. It says so on the pre-formed invoices at my local dealership and the dealerships in NJ. If this is not the case, please show me the policy in writing.

 

great information thanks a lot!

 

That's good info.
In MI and NJ, rebates are applied after the tax on the sale price. So it's X-Plan + Taxes = Price of Car. Then add title/registration/license, subtract rebate, subtract your deposit (for factory orders).

 

Depends on the state. Many states including mine you deduct the trade in value then calculate sales tax. This is the result of the political power the auto dealers have.

However sales tax is calculated before rebates.
Registration / title fee are not subjet to sales tax.

EG. Net discounted purchase price is $30,000
Trade in is $10,000
Rebates are $5,000
Registration & title $120.
Net price paid to dealer after trade in is = $15,120
Sales tax is $1,200 (6% on $20,000).

If finanaced, interest paid does not have sales tax on it

But your state may be different.
It pays to know the law!
You can out the exact laws and regulations on your state's web site.

 

Doesn't matter you're getting screwed! Dealerships suck!

 

That's the way it is in Texas. Alot of dealers do what are known as "pass through" trade-ins. In effect, if you have a buyer for your car, instead of selling it outright, you trade it in and then your buyer immediately buys it from the dealership for the price you negotiated. That way you get the tax benefit and a better price for your old car. Not all dealers will do this but some will.

 

Your anger is a bit miss placed.
No dealership has the ability to determine how rebates, trade ins, etc. are taxed. That is determined by state law. You may want to update your post to indicate you feel your state law sucks!