Quote:
Originally Posted by stealth.pilot
The whole thing is a fucking racket. It also forces you to do dealer trades which is partly what allows dealers to totally gouge you. I normally find a $10k spread between what dealer offers on trade and what I sell my cars for privately.
But here is what is most egregious:
If I buy a car for $100k and register it in GA, I pay $7000 sales tax.
Then I sell it a year later for $85k privately. So the cost of that car for the year is $15k, however I have paid $7000k tax for the privilege of owning it for a year. So the 7% tax rate is an effective tax rate of 45% in my case. That is insane! And if I do a trade to limit my tax exposure, it doesn't help because the money goes to the dealer.
This is why I created an LLC to buy and sell cars via the state of Montana. It literally halfs the TCO of the car and I am happy to pay the annual tag fee of ~$300 to Montana.
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Also the reason why I keep my cars registered in South Dakota. In Montana you have to create an LLC, there is no sales tax, but higher yearly registration fees. In South Dakota, there is a 3% sales tax for new vehicles, but my yearly registration on an M5 is $60 bucks a year and you don't have to have an LLC. Most states don't have laws that say you must register your vehicle in that state if you live or work there, but some do, so you gotta check the specific state laws. Being active duty military or a U.S. Diplomat with a Black Passport, exempts you from having to register your vehicle in any state you currently live in. Georgia is crazy though, and I thought California with their yearly licensing fee was bad, but even compared to the yearly property tax bullshit of Virginia and North Carolina, California is not the worst.