The "how about you write it up for less" on the bill of sale thing.

I get this query all the time from people when selling cars. Will I write up the bill of sale for less money so they can avoid taxes. I'm wondering what you guys do in this regard.

I've actually had a problem writing up a legit bill of sale for a car I sold to my neighbor where I sold it to him for a good price and CT blue books the car and if the sale price is too low they make you fill out some other document and have the buyer and seller sign off that you really are selling it for that price.

GA goes by book, so it doesn't matter sale price, when I sell out if state I leave it up to the buyer to disclose...best I can do...

We get that request all the time from international customers. They want us to lowball the invoice so they don't have to pay the full import duties and taxes. Once you use the term "fraudulent" they usually back off.

I bought and sold a lot of "$150" dollar cars in Ohio.

NY goes by bill of sale. Every car I've ever bought has been a $"500" car. Except for the Miata, that was a $"2000" car.

This guy was from NY so I can see why he would ask. I just get uncomfortable with doing it.

Depends on what I'm selling. I've sold $100 "scrap heaps", $500 "beaters", etc.

Harvey wrote: I get this query all the time from people when selling cars. Will I write up the bill of sale for less money so they can avoid taxes. I'm wondering what you guys do in this regard. I've actually had a problem writing up a legit bill of sale for a car I sold to my neighbor where I sold it to him for a good price and CT blue books the car and if the sale price is too low they make you fill out some other document and have the buyer and seller sign off that you really are selling it for that price.

Tell them no. Full stop.

IMO, you should write in what the advertised price is, any negotiating lower than that could be chalked up to partial barter.

I... errr, ummm... people I know, usually just leave that blank, and tell the buyer to fill in what they want.

Then again, I'm usually dealing in... errrr people I know.... are usually dealing in cheap used cars anyways so it's not like a $10K car is getting a pass as a $300 parts car.

Keith Tanner wrote: We get that request all the time from international customers. They want us to lowball the invoice so they don't have to pay the full import duties and taxes. Once you use the term "fraudulent" they usually back off.

Hungary is the worst about this. $75 for a wire harness from megasquirt + 35 for shipping handling + 50% Hungarian VAT turned my $75 harness into a $150 harness.

For the cars, I don't mind putting the "negotiated price" versus the advertised price. Most of what I sell could be considered crap on wheels anyways

It's one thing for an individual, something very different for a business.

When you really stop and think about it, the whole concept is kind of BS. The sales tax was paid when the car was originally purchased.

Then they get to tax it again. ...and again. ...and again, every time it changes hands. For no real reason. If the original buyer kept it till it hit the scrap yard they wouldn't have to keep paying sales tax on their own car again and again every few years.

Everybody has to pay a use fee by way of registration annually anyways.

Charging sales tax on something that has already had a sales tax paid in full by way of original sale is a bit egregious.

But that's neither here nor there.

In my mind, it should definitely be the negotiated price, not the advertised price that goes on the bill of sale. Why would you write a higher price than what the person actually paid?

Keith Tanner wrote: We get that request all the time from international customers. They want us to lowball the invoice so they don't have to pay the full import duties and taxes. Once you use the term "fraudulent" they usually back off.

Came here to say this, it's mail fraud if you do it while sending a package, and some kind of other fraud otherwise. When you see the import duties that some countries charge which people then have to pay in 3rd-world money, you can see why they try though.

In reply to xflowgolf:

Excellent point!

One thing Nevada did right is eliminate sales tax on private party car deals.

Doesn't matter what you put on the bill of sale, the tax is zero.

It also makes selling a ~$5000 car a little bit easier. Buyers know they would pay +$400 (8.15% tax) or so more if they bought a similar car off a lot.

Raze wrote: GA goes by book, so it doesn't matter sale price, when I sell out if state I leave it up to the buyer to disclose...best I can do...

yup. And if you print out the recommended GA vehicle bill of sale from the state DMV website, it doesn't even have a space to enter the sale amount unless you are selling the vehicle pursuant to a court case. They just have some state valuation database that (I'm told) is based on, but isn't the same as, NADA value.

This is why I pay for cars via Amazon gift cards making it a barter where no money exchanges hands.

Okay not really, but it's a thought

Delaware and the surrounding states go by book value for the title transfer fees, regardless of the bill of sale, or even if it's a true gift. They just assume average condition for the mileage and go from there.

When we transferred DD#1's car title into her name, the clerk did give us a break and value the car at the absolute lowest she could. But all 3 of us were standing in front of her with our IDs.

xflowgolf wrote: When you really stop and think about it, the whole concept is kind of BS. The sales tax was paid when the car was originally purchased. Then they get to tax it again. ...and again. ...and again, every time it changes hands. For no real reason. If the original buyer kept it till it hit the scrap yard they wouldn't have to keep paying sales tax on their own car again and again every few years. Everybody has to pay a use fee by way of registration annually anyways. Charging sales tax on something that has already had a sales tax paid in full by way of original sale is a bit egregious. But that's neither here nor there.

Why? It was sold again. I'm pretty sure that you pay tax on things that you buy from Goodwill, and I know the used records and books store I go to charges sales tax. I also pay sales tax on the used parts I buy from the junkyard.

some states keep charging you property taxes on the car.. every year.

NJ only goes by what is listed on the sales receipt.. unless it is very obvious that it is a stunt. If you bring in the title to a $100 car, you better be able to prove it really only cost you $100. They do not look twice at $1000

xflowgolf wrote: When you really stop and think about it, the whole concept is kind of BS. The sales tax was paid when the car was originally purchased. Then they get to tax it again. ...and again. ...and again, every time it changes hands. For no real reason. If the original buyer kept it till it hit the scrap yard they wouldn't have to keep paying sales tax on their own car again and again every few years. Everybody has to pay a use fee by way of registration annually anyways. Charging sales tax on something that has already had a sales tax paid in full by way of original sale is a bit egregious. But that's neither here nor there.

Yeah. Just recently I sold my Subaru Loyale to my father for the grand total of $200. He printed out the gift form from the NY DMV. He said even though it would be sub $20 in tax, the car had had sales tax paid on it at least 4 previous times and it was just the principle.

Texas has an "minimum tax", so it's a moot point with GRM type vehicles

Knurled wrote:

xflowgolf wrote: When you really stop and think about it, the whole concept is kind of BS. The sales tax was paid when the car was originally purchased. Then they get to tax it again. ...and again. ...and again, every time it changes hands. For no real reason. If the original buyer kept it till it hit the scrap yard they wouldn't have to keep paying sales tax on their own car again and again every few years. Everybody has to pay a use fee by way of registration annually anyways. Charging sales tax on something that has already had a sales tax paid in full by way of original sale is a bit egregious. But that's neither here nor there.

Why? It was sold again. I'm pretty sure that you pay tax on things that you buy from Goodwill, and I know the used records and books store I go to charges sales tax. I also pay sales tax on the used parts I buy from the junkyard.

Those are all businesses, not private party sales.

I've been questioned by the notary public that does title & tag in PA about some of my low low priced vehicles, due to the price being well below their estamted values. I always tell them it was an as-is sale on a vehicle that wasn't road worthy at time of purchase. This satisfies them, and tax is paid on the stated price. Note: the only vehicles that I've done this with that were under $500 were motorcycles, the cars have all been $500 or more.