Quote:
Originally Posted by TheJackal
I found this out from doing some quick research. A dealership does not pay tax on a trade-in. I can take my car to a dealership, trade it in, they pay the payoff to the lease company (no tax), they sell the car to my bro-in law with a small markup for doing the paperwork, he pays tax on his purchase. All perfectly legal and only he pays tax. Now I just need to find a dealership willing to help.
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You benefit on the trade because they do a transfter tax meaning if your old car was purchased for lets say 20K and you paid $1670.00 in tax for that car, then go and and trade it in and buy another car from the trade in dealer and that was 30K you only pay the difference in tax for the extra 10K.