# If you buy a vehicle out of state, do you pay sales tax when you register it at home?



## Denise L (Aug 22, 2007)

Hypothetically speaking, if we were to buy a vehicle (car, motorhome, etc.) in another state and drive it to CA, upon registration, would we have to pay anything besides registration fees?  We are looking (just for fun) for a gently used RV, and I found what looks like a nice one in OR.  We won't be buying anything soon, but if and when we decide, I want to be ready with all the extra costs added up.

I browsed the CA DMV site and could not come up with anything that talked about sales tax or extra fees besides registration.


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## DaveNV (Aug 22, 2007)

Some states do charge sales taxes based on the value in that state, even if you bought the RV in another state.  They may call it an excise tax, or some other clever name, but in the end, it's still a sales tax.  Here in Washington they charge a fee based on their estimated value of the vehicle - which may be way out of line for what you paid, if you got a great deal - but they still charge the taxes.

Look into registering your hypothetical RV in Alaska or (I think) Texas and Florida.  There are favorable tax situations for RV owners in those states.  But if you live in California, you probaly won't get away with much.  They know all the tricks.  

Good luck!

Dave


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## bigrick (Aug 22, 2007)

Denise, I looked into this myself a few years ago.  I even called an Oregon dealer to check the possibilites.  That OR dealer told me it was a CA misdemeanor to avoid CA state taxes in this way.  And I know CA is very diligent at gathering all the tax it can.

I wanted to buy a diesel VW that I could not locate in CA.  I knew the car would not need CA smog equipment (since it was diesel) so I knew I could register it easily in CA.  But the misdemeanor possiblity was enough to turn my head away.


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## Icarus (Aug 22, 2007)

Yes, they will collect the CA sales tax (since OR doesn't have sales tax) when you register it in CA. CA will collect the difference between any sales tax you paid and your local sales tax amount when you register any vehicle you bring into state.

There may also be additional fees, etc if the vehicle doesn't meet CA emissions rules.

-David


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## tomandrobin (Aug 22, 2007)

In Maryland, where we live, they will collect taxes on the sale of the car. I bought my last car in Pennsyvania and had to pay both state taxes when I settled, but got the Pa tax refunded a month later.


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## T_R_Oglodyte (Aug 22, 2007)

Icarus said:


> Yes, they will collect the CA sales tax (since OR doesn't have sales tax) when you register it in CA. CA will collect the difference between any sales tax you paid and your local sales tax amount when you register any vehicle you bring into state.
> 
> There may also be additional fees, etc if the vehicle doesn't meet CA emissions rules.
> 
> -David



Doesn't CA collect the estimated sales tax due (based on their estimate of MSRP) without regard to the actual price paid and without any deduction for sales tax paid at the point of purchase?


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## Elan (Aug 22, 2007)

Living within an hour of the Oregon border, and having purchased my last new car in Oregon, I had to pay the ID sales tax liability (5%) in Idaho upon registration, as I expected.  What was strange to me was when I was shopping for this car, I checked with some Bay Area dealers that had very competitive prices, but I would have to pay the CA tax at time of purchase (~8.75% at the time) even though I would be registering it in ID.  The CA dealer(s) told me if I could take delivery out of state, I could forgo the CA tax and again pay the ID sales tax upon registration, but that was impractical as it mostly eliminated any price advantages.


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## Dave M (Aug 22, 2007)

From the CA DMV:





> When a vehicle is brought to California within 12 months from the date of purchase, use tax may be due. An applicant who purchases a vehicle out-of-state may receive a credit toward the California use tax due for any sales or use tax paid to another state prior to entering California. The tax credit shall not exceed the California tax that is due.


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## Dave M (Aug 22, 2007)

Elan said:


> What was strange to me was when I was shopping for this car, I checked with some Bay Area dealers that had very competitive prices, but I would have to pay the CA tax at time of purchase (~8.75% at the time) even though I would be registering it in ID.


That makes sense. The laws of most states with a sales tax require that you pay the sales tax at time of purchase if you take delivery in that state. That's partly because you can't prove that the purchase won't be used in that state, even though you state your intent otherwise.

That provides for some planning opportunities. When I lived in Oregon (a non-sales tax state) and purchased items (e.g., clothing) while visiting other states, I usually had the retailer ship the item to me in Oregon so as to avoid the other state's sales tax, assuming the shipping cost was less than the sales tax would have been. Now, as a resident of MA, I often buy clothes while in Hilton Head. I have them shipped to me in MA and, thus,  don't pay the SC sales tax. Retailers there don't have to collect MA sales tax on the shipment because MA doesn't tax the first $175 of any individual article of clothing. Since my cheap threshold for clothing is less than that, I escape all sales tax!


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## "Roger" (Aug 22, 2007)

Dave M said:


> ...Since my cheap threshold for clothing is less than that, I escape all sales tax!


I'm shocked.  I always pictured you as a natty dresser -- the Beau Brummel of the timesharing set.


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## falmouth3 (Aug 22, 2007)

When changing residences from state to state, I have been asked to provide information on the dates of car purchases and dates of residence to show that the cars were not purchased while an actual resident of the new residentail state.  I have know people who have moved within a given window and they have had to pay sales tax in both states!

Sue


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## ricoba (Aug 22, 2007)

Icarus said:


> Yes, they will collect the CA sales tax (since OR doesn't have sales tax) when you register it in CA. CA will collect the difference between any sales tax you paid and your local sales tax amount when you register any vehicle you bring into state.
> 
> There may also be additional fees, etc if the vehicle doesn't meet CA emissions rules.
> 
> -David




I agree it may be the CA emissions that may be the hidden cost factor besides the taxes.


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## AwayWeGo (Aug 22, 2007)

*Bought (Used) Car In Florida, Paid Sales Tax On It In Virginia.*

When we bought our eBay 2005 Dodge Grand Caravan SXT in November 2004, we flew 1 way to Orlando FL to pick it up from the independent dealer we bought it from.  The dealer met us at the airport & rewarded us with 2 Disney tickets (which The Chief Of Staff later sold) plus 2 nights' motel accommodations (which we didn't use because we were staying an outstanding Orlando timeshare that week). 

We had plenty of time after our winning eBay bid & before our Florida trip to send payment, receive the title back, & get new Virginia title & tags for the 2005 minivan, so we we took those with us & used'm to drive around in the newly bought car while on vacation & to drive it home at the end of the week. 

Our original expectation was that we'd pay for the car & pick it up with cardboard temporary tags on it, then deal with Virginia title & tags after we got home.  For that to happen, however, the independent dealer in Orlando would have had to collect Florida sales tax on the car.  That might have been OK if -- _if_ -- Virginia & Florida had some reciprocal arrangement in place providing for Virginia buyers of Florida vehicles to get Virgina credit for taxes paid to Florida.  They didn't.  Any Florida tax we paid would have been _mox nix_ as far as The Commonwealth Of Virginia was concerned.  That's why we went with Plan B, taking our own Virginia title & tags with us. 

I hope the independent dealer in Orlando didn't get into any hot water with the Florida authorities over that.  We'll never know. 

Anyway, we still have the car & still like it lots -- best car we've ever had.  The only thing wrong with it is the humongous dent in the rear of the passenger-side sliding door, where an acquaintance backed into it while we were visiting her at her home down in Tennessee earlier this year for her daughter's junior-high graduation.  So it goes. 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## Dave M (Aug 22, 2007)

Alan -

That doesn't seem to fit with this statement from the VA DMV:





> If you are titling your vehicle in Virginia for the first time and you hold a valid assignable title or registration issued in your name by another state or a branch of the United States Armed Forces, you will not have to pay the Motor Vehicle Sales and Use Tax. However, if you purchased the vehicle within the preceding 12 months, you must provide proof that the sales and use tax was paid elsewhere in order to be exempt in Virginia.


 ... or with this statement from a Florida car dealer:





> A Virginia resident who purchases a vehicle in Florida will receive credit for the tax paid to Florida, but will owe additional tax to Virginia on the amount of the trade-in.


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## AwayWeGo (Aug 22, 2007)

*Not Sure That's The Provision Which Applies (Or That The Florida Dealer Has It Right)*




Dave M said:


> That doesn't seem to fit with this statement from the VA DMV:





> If you are titling your vehicle in Virginia for the first time and you hold a valid assignable title or registration issued in your name by another state or a branch of the United States Armed Forces, you will not have to pay the Motor Vehicle Sales and Use Tax. However, if you purchased the vehicle within the preceding 12 months, you must provide proof that the sales and use tax was paid elsewhere in order to be exempt in Virginia.


I think that has to do with getting Virginia title & tags when folks moving here bring their in their cars that they already had titled in the states where they formerly lived.  By contrast, all I had on my newly bought Florida minivan was a dealer's assignment of title (assigning it to me), not anything issued in my name by Florida or by the army.  (I was honorably discharged in 1968.) 

When I researched the point before heading down to pick up the car, I searched both DMV web sites -- Virginia's & Florida's -- on the specific issue of reciprocity between the 2 when sales tax is paid in 1 & new title & tags are issued in the other.  (I may also have called up somebody at Virginia DMV -- but my formerly razor-sharp powers of recall have dulled so badly with advancing age that I can't remember for sure.  So it goes.) 

In any case, as soon as the Florida independent dealer agreed to send me the signed assignment of title so I could do business up here with Virginia DMV, that was all I needed.  I was good to go, sure in the knowledge I could avoid the bureaucratic nightmare of trying to convince the Virginia DMV folks that they didn't have to charge me again for what I paid Florida DMV.  That is to say, the way I was able to do it avoided all that -- all's well that ends well. 





Dave M said:


> ... or with this statement from a Florida car dealer:





> A Virginia resident who purchases a vehicle in Florida will receive credit for the tax paid to Florida, but will owe additional tax to Virginia on the amount of the trade-in.


Based on the checking I did before flying to Orlando to pick up the eBay minivan -- "research" isn't the right word because even though I was semi-thorough I also was semi-unsystematic -- I'd say the the Florida car dealer is flat wrong about that.  I'd have to hear that from somebody at Virginia DMV before I would place any reliance on it.  (Better safe than sorry, eh?)

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## Icarus (Aug 22, 2007)

T_R_Oglodyte said:


> Doesn't CA collect the estimated sales tax due (based on their estimate of MSRP) without regard to the actual price paid and without any deduction for sales tax paid at the point of purchase?



That's true only if you don't have your receipt showing the actual price paid and the sales tax paid in the other jurisdiction. For Oregon, there is no state sales tax, so CA will collect the entire sales tax (or use tax, which is effectively the same thing for items you bring into the state) based on the sales tax rate for the county where you reside.

Some states do it differently, but the OPs question was about California.

If the vehicle was purchased in the state of Washington, then there would be credit for the sales tax paid in Washington. In this case, I believe Washington's sales tax is higher than California's sales tax rate, so no additional sales tax would be due.

If the tax rate is lower than California's, then you just pay the difference.

Hawaii is similar to California. At one point, I looked into buying a Prius from an Oregon dealer and having them ship it to me in Hawaii. I'd have to pay Hawaii's GET on the sale price when I registered it in Hawaii since Oregon has no sales tax. However, when we moved back to Maui from Florida, I had already paid Florida sales tax on my F-150, so no additional GET was due to Hawaii when I registered it here.

-David


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## fnewman (Aug 27, 2007)

jeepguynw said:


> Look into registering your hypothetical RV in Alaska or (I think) Texas and Florida.  There are favorable tax situations for RV owners in those states.
> Dave


You may want to rethink this option as you could end up paying big penalties for not registering your vehicle at your legal address (where the vehicle is garaged).  I know of at least one case where a driver registered his car in Oregon while he lived in Washington.  His neighbor turned him in !!:annoyed:

Of course you could probably get away with it for an RV or similar if you actually kept it stored in another state when not in use.


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## AwayWeGo (Aug 27, 2007)

*What Virginia D.M.V. Doesn't Know Won't Hurt.*




fnewman said:


> You may want to rethink this option as you could end up paying big penalties for not registering your vehicle at your legal address (where the vehicle is garaged).  I know of at least one case where a driver registered his car in Oregon while he lived in Washington.  His neighbor turned him in !!:annoyed:
> 
> Of course you could probably get away with it for an RV or similar if you actually kept it stored in another state when not in use.


We live in Virginia,  bought a (used, eBay) 2005 park-model trailer in New Jersey, towed it to Delaware on the previous owner's tags, mailed the tags back to the old owner, paid sales tax to Delaware & got a new Delaware title, but did not bother with registration (i.e., no Delaware tags) because the trailer just sits there on our assigned spot in our nice little Delaware park & never goes over the road now that it's in its new location.  

Just our little secret -- what Virginia DMV doesn't know won't hurt anyone. 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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