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I will b purchasing a used car from a car dealership in Ohio,

 

Customer Question

I will b purchasing a used car from a car dealership in Ohio, trading in my existing vehicle. Do I pay sales tax on the difference between the sale price and the trade in value, OR pay the sales tax on the purchased vehicle only?

Submitted: 1027 days and 14 hours ago.
Category: Tax
Value: $15
Status: CLOSED

Accepted Answer

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Expert:  Merlo replied 1027 days and 13 hours ago.

HelloCustomer

The tax base can be reduced on the sale of a NEW motor vehicle when a licensed new motor vehicle dealer accepts a motor vehicle in trade.

However, the tax base is not reduced on the sale of a USED motor vehicle when a trade-in is allowed.

Please refer to the following Ohio website which discusses common questions on sales tax. Refer in particular to item #21 which discusses trade in allowances.

http://tax.ohio.gov/faqs/Sales/sales.stm#21

If this was helpful please press the Accept button.

Thank youCustomer and let me know if you have more questions. I am happy to help you with whatever I can.



Expert TypeAccountant
Pos. Feedback: 99.8 %
Accepts: 9646
Answered: 7/29/2009

Experience: 25+ years tax consulting. Specializing in returns for US citizens living abroad

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