Post by
SmoovC »
https://forums.nicoclub.com/smoovc-u179392.html
Thu May 01, 2014 2:01 pm
I am not sure about other States, but in Washington there is a financial advantage to trading in a car at a dealership. The sales tax amount is based on the price difference; not the total purchase price. For example: if you are buying a car priced at $30,000 and your trade is valued at $20,000, the taxable amount is the $10,000 difference.
At current rates, (9.8%) that amounts to $980 where I live. Of course, you have to be sure the tax advantage offsets the lower trade in value (vs. selling it yourself) offered by the dealer.
Conversely, if you sold the same car yourself, and were able to get $22,000 for it, you would be $2000 ahead on the sale, but be liable for an additional $1960 in taxes on the purchase of the same $30,000 car. For $40, I would not be willing to mess with the hassle of listing, showing and selling it myself.
Also, I would much rather the dealer kept the money and continue to promote the local economy, rather than giving it to the State to waste on its liberal agenda that I don't agree with in the first place.
Obviously this is just an example, but you can see the point I am getting at.