I want to trade my car with someone, we are going to do an even trade. If I do this will I have to pay sales tax on the cars worth to get it registered and tags put on it??
2007-05-02 00:28:08 · 4 answers · asked by Doug F 3 in Cars & Transportation ➔ Buying & Selling
You'll have to check with your States Department of Motor Vehicles. The sales tax regulation is not the same in every state. In some states the tax on automobile transfers has been changed from a "sales" tax to a "use" tax so that it applies whether or not there was n actual "sale".
Several states have turned to requiring a tax on the the car's value, rather then the sale or trade price, because they suspect that people were using "gift" or "$1.00 sale" or "even trade" claims to avoid tax on an automobile transfer.
Some States allow a tax-free transfer only within a family (parent to child for example), and charge a "sales" tax or "use "tax on All other transfers.
If you are in a State that requires it, yes, you will pay a tax on the car's value to get it registered.
2007-05-02 00:34:19 · answer #1 · answered by me 7 · 0⤊ 0⤋
Some states are different. On used cars that have already had the sales tax paid on it once in the state of KY, you do not have to pay the sales tax again. You will have to pay the property taxes on it however and so will your friend. In our state it is whoever owns the car on the 1st of the year. Call the DMV and ask them what the obligations are in your state.
2007-05-02 00:35:06 · answer #2 · answered by Fordman 7 · 0⤊ 0⤋
You didn't pay anything for it so you won't have to pay sales tax. You will have to pay for the registration/tag fee since they have to do the paper work for changing to ownership of the vehicle.
2007-05-02 00:34:51 · answer #3 · answered by nosycap9 3 · 0⤊ 0⤋
Yes, because it is still considered a sale.
2007-05-02 00:50:16 · answer #4 · answered by ronald g 5 · 1⤊ 1⤋