Trade-ins?

[Gshenderson]

For those of you considering trading in your current vehicle, this might be somewhat encouraging. The chip shortage and global supply chain issues are driving up prices on used vehicles.

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[DuckTruck]

For those of you considering trading in your current vehicle, this might be somewhat encouraging. The chip shortage and global supply chain issues are driving up prices on used vehicles.

Greg, I've heard plenty of anecdotal comments about this phenomena, but this is the first evidence I've seen. It may push me to trade-in now, while the used market is hot. Do you remember the source of the info?

Thanks again!

 

[SeaGeo]

Greg, I've heard plenty of anecdotal comments about this phenomena, but this is the first evidence I've seen. It may push me to trade-in now, while the used market is hot. Do you remember the source of the info?

Thanks again!

Anecdotally I checked on what I could get for my Subaru after receiving and email from a local ford dealer saying they are in need of cars. They offered me a little less than I would have gotten from Tesla in December.

 

[jimcgov3]

I just checked Carvana on our 2017 Nissan Murano Platinum and the trade in has gone from $19k and change to over $23,500 in 2 months. If only we could get away with one car until the R1T got here...

 

[cwoodcox]

It’s true, a guy I work with has seen his Ram increase to $5k more than he paid for it a year ago. However, if you’re like me with a vehicle that is not at all in demand, you won’t have seen much of an increase.

 

[elas9000]

I just sold my car to Vroom, and it was shockingly easy. You fill out the description of the car online and you get a quote from them via email (it took about 15-20 minutes to receive). If you accept it, then they send some documents via Docusign for you to agree to the transaction. Within the next week or so, you get some papers via FedEx (Power of Attorney and some other stuff). Sign and return in the enclosed FedEx overnight envelope. The next day, they contacted me with the company that would come to my house to pickup the car (they came a few days later, calling first to arrange a time). They picked up my at about noon on a Tuesday, and by Wednesday morning I had a FedEx envelope with the check. They handled the payoff of the lien with the bank as well.

The downside vs. trading in (at least in Georgia) is you lose the tax benefit of the trade in. Georgia imposes a title ad valorem tax at the time of purchase at 7% of the purchase price (in lieu of a sales tax). If you trade in a car, you only pay the tax on the net difference in price. So if you sell a car that you could have gotten $20k in a trade, you're giving up the $1.4k of reduced TAVT ($20k x 7%).

If we but directly from Rivian does that mean Illinois sales taxes apply, or do home sales taxes apply?

 

[azbill]

If we but directly from Rivian does that mean Illinois sales taxes apply, or do home sales taxes apply?

In Arizona Rivian will have to have a dealers license, just like Tesla. You pay Arizona state sales tax and get it titled and registered directly in Arizona at the time of the sale. I bought a boat in California many years ago and the dealer there was all set up to have it taxed by Arizona, since he was on the border and did a lot of Arizona sales.

 

[cwoodcox]

If we but directly from Rivian does that mean Illinois sales taxes apply, or do home sales taxes apply?

Most states expect the sales tax at registration time, so wherever you’re getting the plates.

 

[DucRider]

Greg, I've heard plenty of anecdotal comments about this phenomena, but this is the first evidence I've seen. It may push me to trade-in now, while the used market is hot. Do you remember the source of the info?

Thanks again!

Local used car dealer that does only EVs usually carries around 60 in inventory. He's down to 11.
Primarily off lease vehicles, and the stop sell on Bolts has definitely impacted him, but the overall market is tight. He's even starting filling in with a few PHEVs.

 

[2021R1T]

I purchased a new A6 in Oxnard, CA last year and brought it back to Gilbert, AZ to title and tag. No issues at all. I had no trade in so paying CA sales tax was even since they don’t offset the taxes for trade in. You pay full value. AZ did not charge any additional sales tax since I had paid sales tax in CA so that was a wash as well. I would see no problem picking the R1T anywhere and bringing it back.

 

[jacksonhandy]

I purchased a new A6 in Oxnard, CA last year and brought it back to Gilbert, AZ to title and tag. No issues at all. I had no trade in so paying CA sales tax was even since they don’t offset the taxes for trade in. You pay full value. AZ did not charge any additional sales tax since I had paid sales tax in CA so that was a wash as well. I would see no problem picking the R1T anywhere and bringing it back.

In Georgia, it doesn’t matter, it is a title ad valorem, so they’ll screw you and take 7% of what the “fair market value” is. Even if you’ve paid sales tax in another state. That’s how I ended up paying another $2800 to register my wife’s Honda Odyssey when we moved down here, even after owning the car for 6+ months and paying Illinois sales tax on it.

I just used it as an excuse to buy a new car.

 

[Gshenderson]

In Georgia, it doesn’t matter, it is a title ad valorem, so they’ll screw you and take 7% of what the “fair market value” is. Even if you’ve paid sales tax in another state. That’s how I ended up paying another $2800 to register my wife’s Honda Odyssey when we moved down here, even after owning the car for 6+ months and paying Illinois sales tax on it.

I just used it as an excuse to buy a new car.

NC does the same thing, but it’s only 3%.

 

[SANZC02]

In Georgia, it doesn’t matter, it is a title ad valorem, so they’ll screw you and take 7% of what the “fair market value” is. Even if you’ve paid sales tax in another state. That’s how I ended up paying another $2800 to register my wife’s Honda Odyssey when we moved down here, even after owning the car for 6+ months and paying Illinois sales tax on it.

I just used it as an excuse to buy a new car.

One of the rare instances where CA is a little better than another state when it comes to taxes. CA will credit you the tax amount you paid out of state and only collect the amount above that.

The rest is not as fair, here you have to pay taxes on full price paid, the trade does not reduce the purchase price. As a matter of fact, when manufacturers offer rebates, they take the sales price before the rebate. An example the manufacturer offers a 4500 dollar rebate on a 20000 dollar car, tax is on 20000 even though you only paid 15,500.

https://www.californiacartags.com/register-cars-from-out-of-sta

 

[Gshenderson]

One of the rare instances where CA is a little better than another state when it comes to taxes. CA will credit you the tax amount you paid out of state and only collect the amount above that.

The rest is not as fair, here you have to pay taxes on full price paid, the trade does not reduce the purchase price. As a matter of fact, when manufacturers offer rebates, they take the sales price before the rebate. An example the manufacturer offers a 4500 dollar rebate on a 20000 dollar car, tax is on 20000 even though you only paid 15,500.

https://www.californiacartags.com/register-cars-from-out-of-sta

UT is the same. I think this depends on whether the state classifies it as a “sales tax” or some other type of use tax. Use taxes will be collected regardless of what you may have paid elsewhere. Sales tax will just be the net difference between what you already paid in another state and what you would have paid based on the local sales tax rate. At least that’s been my experience in several states.

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