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Thread: tax implications
11-02-2004 02:30 AM #1
When I bought my Civic Hybrid in April, 2004, I lived in Maryland and purchased it in Maryland. Because of that, I qualified for a tax credit & didn't have to pay any taxes on the purchase.
We just moved to Virginia, and now in order to get a new title & license they say I have to pay the tax I was credited in Maryland!
How can this be legal? I can understand they want to make sure I'm not a tax evader before giving me a license, but how can they legally tax a purchase made in another state?
Any thoughts or suggestions would be most appreciated.
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11-02-2004 07:33 AM #2
boy that sounds COMPLETELY wrong!
one state's tax plan is far from another state's concern. if i move there do i get a refund from california? or do they pay me the difference from lower or higher california taxes?
something is not right there! you need to contact your local state congessman, senator, etc. the offices of these reps are staffed with people who track down these details. contact your old & new state reps to get a true picture of this issue.
11-02-2004 04:03 PM #3
I agree. This doesn't seem right. I'm trying to track down an answer. I'll post it, as soon as I get any details.
11-05-2004 03:04 AM #4
I'm a CPA in California and it sounds to me that what Virginia is doing is assessing a use tax. A use tax is similar to a sales tax and generally assessed on purchases from private parties as well as personal property bought in another state and brought into the state within a certain number of days after it was purchased.
States generally impose a use tax so that they get the equivalent of the sales tax when you buy a car from another individual instead of from a dealership. They also impose a use tax to protect against shopping in a sales-tax friendly state and bringing it into the state.
I would guess that the problem is that you have not owned the car long enough to avoid the use tax when you bring it into Virginia.
11-15-2004 10:19 AM #5
so the plan would be to hold the car for how many moths to avoid a tax?