Question on trading in my IS in Texas
#1
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I'm going to be relocating to the Houston area in about a month, and will be trading in my 2007 IS250 6MT.
If I understand it correctly, in Texas I can deduct the price of the new car from the price of my trade, and pay sales tax on the difference. However, what if the car I'm getting costs less than my car is worth? Do I then pay NO sales tax?
Thanks in advance.
If I understand it correctly, in Texas I can deduct the price of the new car from the price of my trade, and pay sales tax on the difference. However, what if the car I'm getting costs less than my car is worth? Do I then pay NO sales tax?
Thanks in advance.
#4
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That's an interesting Q. That's one of the selling points of trading. But, if a car dealership takes the price down to $0 b/c of your trade, they are inviting an audit of their records, whether or not it's legit. It just looks funny.
#5
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Not an issue. If you roll in to a Toyota dealership and want a brand new Camry that costs $25,000, and they offer you $25,000 for your IS, the taxable value is ZERO. It is a legit transaction and will not cause any problems with an audit. If there was a pattern of these sorts of deals it might raise a flag, but a one off example is nothing to worry about.
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