TRD Pro & TX Baja OFFICIAL Thread...

Yes. Here in Colorado, we pay sales tax on the difference between the trade in and the new vehicle. So for round numbers, you trade in Tacoma for $30k. Price of new Tundra is $45k. You pay taxes on $15k, not $45k. Big difference.
That's why I chose to trade in my wife's 4R on her Jaguar 3 years ago, and I'll likely do the same on her Rivian on order.

Taxes suck BTW.

 

Maybe CO is different? But the seller shouldn't have to pay sales tax, that's the buyer's responsibility. At least that's how it is here. Whenever you sell a car in CA you're only on the hook for the cost of smog. Taxes, reg, back fees...etc would all be the responsibility of the buyer.

Also, sales tax on the vehicle would be paid in the state in which the buyer is registering it, not in the state in which it was sold. If you buy out of state at a dealer they will charge you whatever the local tax is then they will forward that tax to the state which the buyer registers the vehicle and then the buyer is on the hook for the difference. So if I bought a truck in CO I'd pay 8% to the dealer there (which they'd then pay to CA) and I'd come home and register it and have to pay an additional 2%. That way CA gets the full 10% tax. If you're selling private party then all the tax is collected at the time of registration by the new owner in the new state. There are some exceptions and differences but that's the basics of how it typically works.

Aurora isn't that bad (8%) unless there are some extra add-on's google didn't provide when I searched. I'm 10% here where I live.

8% Sales tax on a $50k Tundra would be $4000. If trade-in offsets that then $50k-27k = you paying tax on $23k which would be $1840.

If you can sell for $37k vs trade in of $27k then that $10k difference is more than 2x what you'd pay in tax for the Tundra w/o offset or 5x the tax you'd pay with the offset.

Now, if you have to report the sale proceeds as income that could be another factor to consider although the gov may see that as the same whether it's a trade in or private sale? But even then, technically the "income" here would need to be only if you are selling for more than you paid originally. I don't think there's much policing here so it's probably not even a concern.

(BIAS ALERT: I hate dealers. I hate that they offer you nothing for your trade while trying to make it seem like they're doing you a favor. I'm a HUGE proponent for selling privately. Anyone I know who's trying to trade in a car I will offer to sell it for them (detail it, professional quality photos, handle posting the ads & showing the car...etc))

 

"Car Sales Tax for Trade-Ins in Colorado
Trade in ColoradoYou do not have to pay a sale tax on the trade-in on your vehicle in the state of Colorado.

In other words, when calculating sales tax, be sure to subtract the trade-in amount from the car price.

Let’s say that you're purchasing a new car for $45,000 and your trade-in is valued at $5,000. This would put your new vehicle purchase price at $40,000, which is the taxable amount.

Car Sales Tax on Private Sales in Colorado
You will have to pay sales tax on any private car sales in Colorado. The rate is 2.9%.

For instance, if you purchase a vehicle from a private party for $20,000, then you will have to multiply that amount by .029 to get $580. That brings the total to $20,580"


https://www.findthebestcarprice.com/colorado-vehicle-sales-tax-fees/#:~:text=You do not have to,amount from the car price.

Hmm that doesn't say about me being the seller. Let me keep reading.

 

Math isn't my strong suit lol so imma just gonna go with the little guy on my shoulder telling me to do the easy thing. At the same time it is still for sale privately if they buy it before the new truck is ready

 

Doesn’t sound bad to me. That’s probably what I’m going to do. Much easier than dealing with people. I haven’t listed mine anywhere but here, because too many uneducated people would make comments on the price not knowing what it is…

 

My interpretation of this is that the buyer would pay the 2.9% sales tax, not the seller. Seems like a logistical and bureaucratic nightmare for the state to try and collect the tax from the seller.

 

You pay the tax when you register the vehicle.

 

Big tree activities

 

Yeah, that's exactly what I'm saying. The OP was thinking that the seller pays the tax - which would be logistically difficult because once the seller sells he washes his hands of the car and there's no opportunity for the state to collect tax. Whereas the seller has to register so tax collection is simple and straight forward as a part of that process.

 

Ready for the weekend!!!

 

Hey bro, you had a typo. corrected it bro.

 

I stayed in an airbnb so it doesn't count as overlanding

 

I hate to be the bearer of bad news but you are probably not getting $27K for your vehicle from the dealership unless you are also negotiating the price of the Tundra down at the same time. The way it works at the dealership is a Used Car Manager whose only job is to purchase used vehicles from customers evaluates every used vehicle traded in at the dealership. That used car manager has their own department and is judged on how much they make on the vehicles that they price. So customers bring their trade in to the dealership and the used car manager puts a value on the trade-in so that no matter if the dealer sells it retail or wholesale they make some money on it. Then the sales department takes that number and presents it to the customer. Usually that does not go well as the number is quite low and the customer complains and says their trade in is worth more, etc. So the sales department "negotiates" and comes back with more money for the trade. But the actual value of the trade did not increase, rather the sales team took money off the price of the new vehicle being purchased and added it on the the ACV(actual cash value) of the trade in to give an artificially inflated number. Negotiations continue until the buyer is happy with the trade in price and a purchase is made. Rarely a deal maybe very close to being done but not quite there and the used car manager is approached and asked if they could "give a little more" for the trade and then the used car manager will offer a bit more to make the deal.

Now maybe the $27K figure is real or maybe it is really lower than $27K and they have lowered the sale price and added that amount to the trade in value. If you really want to know there are a couple ways to find out. One is to tell them that you have decided to wait on purchasing the other vehicle from them or you found a Tundra somewhere else but you would still like to sell your trade-in to them for $27K. If they buy it for $27K then that is the true value they have put on the trade in. I think they will tell you that they cannot offer you that much if you are not buying from them. The other way is to tell them you are going to sell your trade-in privately, negotiate your best price on the Tundra, then tell them your buyer fell through and you would like to trade in your Tacoma after all, please take $27K off the price. If you go this route and they do take $27K off the price then you know that was the real price they were buying your Tacoma for. If they tell you that they cannot give you that much for your trade in and they offer another number then that other number is what they had your Tacoma valued at the entire time. Make sense?

Aren't car sales fun?

 

Good lord, you’ve now scared me away from ever buying a new car. This is too much for my brain.

 

that’s good info to know man thank you. They definitely know how to fínese

 

I would say that is exactly true. I always tell them “all I am worried about is the end number of what I am financing.” I well aware they can and do play with the numbers from each vehicle so a deal can always be done. It is just a matter of how much I feel comfortable paying because no matter what, they are making money. It is just a matter of how much I feel comfortable them making off of me. They won’t sell you a vehicle if they aren’t making money.

 

Explaining how car buying works and the art of getting a "good deal" can be quite lengthy, very involved and time consuming and beyond what most people have the appetite to try to understand let alone put into actual practice when it comes to buying a vehicle. I sold Toyotas/Used cars for 1.5 years in the late 80's/early 90's and learned a ton of what I needed to know. I rarely offer advice because most people don't want to hear it and are not willing to put in a little extra work to save quite a bit of money. But the formula for getting a good/fair deal is really pretty simple.

-Never buy based upon a monthly payment. The dealer can control too many of those variables, play with the numbers and you will have no idea if you are getting a decent deal or not. Know what you can afford for a monthly payment, translate that into max dollar amount you can afford based upon a rate and loan length that works for you and go negotiate your lowest price out the door.
- As mentioned above, isolate your trade-in from the process until you have negotiated a final sale price on the vehicle you want. Then introduce it back into the mix. This will really screw up the process temporarily but it will give you a true number of what they are giving you for a value for your trade-in and put the power back into your hands regarding exactly what you want to do. Other used vehicle lots may offer you a better price for your trade-in or it may make more sense to sell it privately or to a relative once you know the TRUE value they are offering you.
-Watch out for the finance manager. Dealerships maximize profits in EVERY way they can, parts, service, sales, finance, used vehicle buyer, fluff add-ons to vehicles(paint protection/extended warranties/service contracts) Have your financing lined up in advance and know what you can get outside the dealership. You can negotiate in the finance managers office as well.
-Don't get emotional, or insulted. Rather just be willing to walk out. You often get your best offer when you are leaving.
-Do talk to multiple dealers. Play one off on the other. Emails work great to expedite the process and cut through the bullshit. When I bought my 2014 Tacoma I didn't speak a word to a salesperson/dealership until I had isolated the dealer who was going to give me the best price and even then I only spoke to them once, after we had agreed on a price. -Be willing to travel as far as 2 hours or more away to get your best price. I once sold a Supra to a guy from New Jersey(I worked in Portland, Maine) because he could not buy what he wanted locally and his prices locally were through the roof.

Best of luck everyone!

 

Agreed. I never tell them a desired monthly payment. I always research the rates before hand knowing what I can qualify for and then knowing what my payment would be based on how much I’m financing.

also, I don’t mind getting stupid with these guys because I know what they are trying to do (make as much money as possible) they don’t care about anyone. Just money. I have no issues walking out.

 

Not every sales person falls into the category of not caring about the customer. I certainly did and that, probably more than anything else, spelled my doom as a car sales person. I did not lie to my customers as I did not need to but I was lied to almost everyday by some of my customers. One woman "bought" a car, went into finance and could not get financed as when the Finance Manager called her listed employer they said she did not work there. When confronted with this info the customer stated they gave the wrong employer that they forgot they no longer worked there then gave a new employer. She did not work at that job either.

I once walked out to a customer strolling down a line of trucks and asked how he was doing and how I could help. He said, with a very tense voice, "I was doing just fine until you fucking came out here".

Do you know when a customer is getting a good deal? When they BELIEVE they are getting a good deal. For some that might be full price for a vehicle they really want and cannot find anywhere else. For another it is $1500 below invoice for a vehicle that has been stuck too long on the dealers lot. A finance manager once fielded a phone call where the customer asked if they could be financed if they had just declared bankruptcy. The finance manager asked when they had filed. The customer said earlier today. The FM said, get in here right away before it is reported to the credit bureau. For them any vehicle at any price was a good deal.

I liked treating people well and honoring their trust. I was on their side since I received nothing unless they were comfortable and happy enough to actually purchase a vehicle.

 

Yeah that stuff is unfortunate. And you are correct. There are good guys out there. When I bought my current Baja, my guy was awesome.