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Can you explain all taxes that are payable when I want to

Customer Question
buy or lease a car...
Can you explain all taxes that are payable when I want to buy or lease a car in DC ?
Submitted: 2 years ago.Category: Tax
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Answered in 13 minutes by:
12/24/2015
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 13,282
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi,

...

In DC the excise tax (car tax) is based on the size (weight of the car)

...

6% "Excise Tax" for
vehicles under 3,499 lbs
-----------
7% for vehicles 3,500
to 4,999 pounds
-----------
8% for vehicles 5,000
pounds or more
-----------

...

And on a lease In DC you pay 10% on your monthly lease payment, there is no upfront sales tax

...

When you buy a car from a dealer, they tend to handle the paperwork for you. Make sure the dealer:

  • Gives you the car title.
  • Collects excise tax (will automatically do so from the lease payments if it's a lease)
  • Is registering the car on your behalf.
  • Gives you temporary tags.

...

Let me know if you have questions

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago

By the way, here's an excellent overview of the PROCESS of buying in DC.

...

For example, if you buy from a private party there will be more work to be done.

...

Here's an excerpt:

...

In order to transfer the title, you’ll need to go in person to your local D.C. DMV office with:

  • The title, signed by BOTH you and the seller.
  • The bill of sale.
  • Your D.C. driver’s license or ID.
  • Proof of odometer reading, which can be certified on:
    • The back of the vehicle title.
    • A vehicle inspection.
      OR
    • A dealer reassignment form.
  • Payment for the $26 title transfer fee.

NOTE: If you are financing the car, you will also need a copy of your lien or lease agreement.

...

http://www.dmv.org/washington-dc/buy-sell/used-cars/paper-work-when-buying-a-car.php

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago

I hope this has helped.... Again let me know if you still have questions.

...

If this HAS helped, (and you don’t have additional questions on this), I'd really appreciate your positive rating … (by using the stars on your screen) … … That’s the only way I'll be credited a portion of what you've paid JustAnswer.

...

Thank you,

Lane

.

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Lane
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 13,282
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Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986

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