Cash For Clunkers? As i understand the gov wants the full tax out of the new car price and this is way to easy to get the money for them and they will not give this up for any one. and so you have to play the full price tax on any new car purchase with the Cash For Clunkers deal and the gov puts it to the poor man again.
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Question
Submitted 117 days ago...
Is "Cash For Clunkers" rebate deducted from purchase price in order to calculate sales tax?
Also referred to as the CARS (Car Allowance Rebate System)
I am purchasing a car in the state of Ohio. The dealer wrote the purchasing agreement that deducted the "Cash for Clunkers" rebate after sales tax was calculated. When calculated in this manner my trade in has no value then as far as sales tax is concerned. It is my understanding that the value of a trade in is normally deducted from the purchase price then tax is calculated.
The CARS website suggests that the impact on sales tax varies from state to state.
Where can I find a definitive answer.
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Awarded Answer (What’s This?)
Answer 2 / 2 - Submitted 116 days ago...
I would say your best bet is to talk to a tax adviser on this one, as like it's written, the taxes vary from state to state. They would know better, and hopefully already would know the answer. If you are correct in saying that the deduction should happen before taxes, then you can remind the dealership that what they are doing is not legal, and can be reported.
However, like the other person said, the government is probably going to allow taxes before the deduction as to get as much back from this as possible. You can always try another dealership in the area, and see if they do the same thing.
My advice to you is not to mention you are wanting to trade in a vehicle, nor are you participating in the CARS program until after you negotiated a price you like. Even if they ask at first, just tell them you aren't. If they know you are, your negotiation power goes down tremendously, and they won't stray very far from MSRP. So, just be careful. Here is a link to another Cash for Clunkers question where you may get some pointers or stuff you didn't know about:
http://www.webanswers.com/automobiles/cash-for-clunkers-004580
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