sales tax credit for trade-in vs. selling outright? - Nissan Titan Forum
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#1 (permalink) Old 09-23-2009, 07:58 AM
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sales tax credit for trade-in vs. selling outright?

I've heard that when you trade in your car you get a tax credit towards your sales tax for the purchase of the new vehicle. Say you're trade in is worth 10k and the car your buying is 25k, then you only have to pay sales tax on 15k.

Now what if I wanted to buy a new car, but instead of trading in existing one just sell it outright, on craiglist or whatever. Would I still be able to get the sales tax credit towards the purchase of the new car? I'm in Texas.

Any help would be appreciated.


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#2 (permalink) Old 09-23-2009, 09:54 AM
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Re: sales tax credit for trade-in vs. selling outright?

Umm, you get a tax credit for the sales tax paid on a new car purchase. Other than that I have no idea WTF you're talking about



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#3 (permalink) Old 09-23-2009, 09:58 AM
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Re: sales tax credit for trade-in vs. selling outright?

Doesn't work like that in Texas. You're going to pay sales tax on the full amount of the vehicle you buy. Regardless of what you do with or how you sell your old vehicle. In Texas that tax is 6.25% on a vehicle purchase.

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#4 (permalink) Old 09-23-2009, 05:30 PM
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Re: sales tax credit for trade-in vs. selling outright?

Quote:
Originally Posted by atcNick View Post
I've heard that when you trade in your car you get a tax credit towards your sales tax for the purchase of the new vehicle. Say you're trade in is worth 10k and the car your buying is 25k, then you only have to pay sales tax on 15k.

Now what if I wanted to buy a new car, but instead of trading in existing one just sell it outright, on craiglist or whatever. Would I still be able to get the sales tax credit towards the purchase of the new car? I'm in Texas.

Any help would be appreciated.
You would have to pay taxes on both situations. Let's use the numbers your suggested

25000
1562 tax
10000 down payment from private sale

16562 amount to be fianced


25000
10000 trade-in
937.5 tax

15937.5 amount to be fianced

In the first example you'll have to sell your truck about for 10635 to equal the same amount to fianace if you were to just trade it in. Its a give a take situation. That's why if you dont think that you can sell your trade in more than what the dealer is offering, your better off just trading it it.

Last edited by real_texan77; 09-23-2009 at 05:33 PM.
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