When you think about leasing a car you need to consider something that few people take into consideration until they are at the dealership. You may be surprised by how much car leasing sales tax can effect your lease payment. Unlike making a purchase and your state and local sales tax is added on to your sale price, but when you lease an automobile the sales tax may be computed on the payment or depending upon your state of residence if could be based on the full sale price of the car rather than the lease period price.
Are you confused yet? That’s not my intention, but when it comes to car leasing and sales tax its easy to end up scratching your head because it doesn’t always make sense. The object of this article is to make you aware of how sales tax on car lease can affect the amount of money you have to put out every month.
Payments and Car Leasing Sales Tax
For example: You could lease a car in one state that would sell for $30,000.00 and your payment with taxes could be $450 a month, but if you live in another state you might be able to lease the same vehicle and your payment would be close to $390 a month. Wow, that’s a big difference and the only thing that changed in this scenario is the car leasing sales tax and the way it’s calculated.
Your car leasing budget can take a pretty big hit when it comes to sales tax so it’s important to be aware of how your state of residence gets their piece of the car lease transaction. In the above example an extra $50 to $60 dollars a month can easily push a person over their car budget allowance. This is not something you want to discover after you went through the entire process of leasing a car when it’s time to sign your car lease contract and write that check.
Now let me give you something else to think about. If you decide to buy the car are you going to have to pay sales tax on the vehicle you just leased? You may have to depending on where you live. Check with your state D.M.V. or accountant and see how sales tax will effect your buying or leasing power.
There is quite a bit of confusion when it comes to leasing cars like residual value and money factor. Now you have to think about car leasing sales tax, but as you can see it makes sense to know ahead of time how your budget will be impacted by sales tax when leasing cars.
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