Out of state car purchase (Denver, Pueblo: mortgage, insurance, hotel)

[Charles]

I may buy a brand new car out of state and drive it to Colorado where I live.

Background: My employer partners with several car dealerships across the country; unfortunately none are in Colorado. I may get a fleet discount for a purchase in Tennessee or Washington State or Alabama. If the discount is big enough, it may be worth buying out of state and driving the car back to Colorado. For the purpose "crunching the numbers" I am looking for what other costs (other than a one way airline ticket, one night in a hotel, and gas) there might be versus purchasing the car here in Colorado.

What might be involved that would be different than if I had purchased the car here in Colorado? Would I have to register it in both states? Taxes in both states? Anyone have any experience doing something like this?


Trying to avoid too much sticker shock:



Also want to avoid meeting up with these guys:





Thank you in advance.

[vfrpilot]

Hey Charles,
Just get the exact car with options and price. Estimate the costs to bring car back. Take these to local dealer and see how close they'll come. Try e-mailing dealers in Denver and Pueblo. I'll bet someone will match or beat fleet price+expense. Large SUV's are not moving right now, so it's a good time to deal.
Most states have a temporary license to get out. I think CA has a 10 day temp. Any dealer in the state you're looking should know.

[Charles]

Originally Posted by vfrpilot

Hey Charles,
Just get the exact car with options and price. Estimate the costs to bring car back. Take these to local dealer and see how close they'll come.

We're going to do this too but I'd like to know the additional costs and the process just in case the final numbers are like two or three grand lower out of state....

Came across this useful table in Kiplingers:

Tax-Friendly Places to Buy a Car - Kiplinger.com

Yikes, Tennessee has a 7% tax rate, Colorado is 2.9%

[Mike from back east]

Am I the only one to notice that the two young women in the Sticker Shock photo's are in the SAME car lot?

One woman is white, one is black.... ..... hmmmm

[denverian]

I worked at the DMV in Denver years ago and all I remember was that when people did this, it was a huge pain for us and the purchaser.

One messy point was sales tax. If I remember correctly, if you buy the car in another state and they don't charge you sales tax or the other state's tax is lower than what you'd pay in your Colorado county, they the DMV here will charge you full sales tax or the difference if it's higher here.

You'll probably have to get an emissions test (I'm not sure since CO doesn't require one on a brand new car) and VIN verification (can be obtained at the emissions place) and then the other problem was the paperwork being different from another state compared to what you'd get from a CO dealership. I think the main problem is that this situation comes up so few times per year that DMV employees (including management) don't remember what to do or how to process out of state paperwork. It seems like you also may have to send the dealer out of state a Colorado form (application for title, I think) and have them fill it out and send it back. It's a bit complicated, but can be done.

[jazzlover]

Call your local county clerk's office for exact information. If you purchase the vehicle from out-of-state and do NOT intend to register it there (which you sure as hell shouldn't if Colorado is your state of residence), then that state should not charge you their sales tax. When you register the vehicle in Colorado, you will have to pay the sales tax due. Do not be fooled by the 2.9% comment. In most all jurisdictions, there is some combination of county and city taxes, plus RTD tax in the metro counties. This can push the sales tax percentage up over 8%. I am not sure, but I don't think you have to have a VIN inspection if the vehicle is new and you have the Manufacturer's Statement of Origin (MSO) as part of your paperwork. The Clerk's office can tell you that. I haven't had to deal with Colorado emissions inspection, so that is something to check on. Also, Colorado requires proof of insurance to register a vehicle.

Undoubtedly, someone on the board will post some little reindeer game to play to avoid paying Colorado sales tax or registration fees. I will say the same thing about those types of tax avoidance (if not outright evasion) that I do about other tax evasion schemes: You may think that you're just screwing the government out of some tax money, but you are really screwing your neighbor. The tax burden is there from the various taxing entities providing services--it is just divided up among the taxpayers. If you (or whomever) doesn't pay their fair share, the rest of the taxpayers just have to pick up the tab.

[sunsprit]

Bringing a vehicle ... new or used ... into Colorado for registration will require the physical VIN inspection. A new vehicle may be exempt (coming in on an MSO) from an actual emissions test, but will be required to get the emissions decal for the windshield and display it.

At the point of titling and registration, you will pay the appropriate Sales Taxes due to the state, county, municipality, and any special tax districts here in Colorado based upon the address the car is registered to.

The "schemes" of yesteryear to "register" a car at a lower tax rate address are pretty much done and gone. The state and the cities are too jealous of their tax revenues anymore to tolerate this stuff and are very aggressive about cross checking and verifying where the car is really based. You simply cannot claim your infrequently used cabin in a remote county area of Colorado for your car location anymore and keep it mainly in the Front Range areas. Especiallly with the law enforcement folks looking for cars frequently seen in Denver (and the Front Range emissions area) without an Emissions sticker in the windshield. They will cite your car for being a frequent front range area car ... and they really do keep track, especially if your car is seen in the same parking lot areas on a daily basis.

Part of their efficiency about this enforcement now comes from the ability of law enforcement and insurance companies to cross check each other's databases via on-line computer data. You don't want to get caught registering your car at one address and having your insurance package at another residence with other vehicles there ... it raises red flags for the authorities, and they have a few folks who will actively pursue finding out why.

FWIW, Colorado's enforcement of this goes back well into the 1960's ... when I moved here with out of state plates as a full time out of state Univ student. I had a part time job and it only took the local sheriff's deputy a month to write a citation for getting Colorado plates on my car, because they saw it parked several times in the same employee parking lot. At that point, the burden of proof that you don't need Colorado license plates (and now, emission inspection sticker) is on you.

I even had Denver police recently write a citation for my Wyoming plated car when they saw it repeatedly parked in Denver for not having a front range user emission sticker. Yes, that's right .... even if your car is registered somewhere else and you are a frequent Denver commuter, you must have a Colorado emissions sticker. In my case, I was on a contract job in downtown Denver for 2-3 weeks, but I still had to file with Denver that my frequent car use was a temporary assignment. If I'd been there for over a month, then I'd have had to gotten an emissions inspection. The same goes for someone commuting into Denver from another county area which doesn't require the emissions inspection.

[jazzlover]

Originally Posted by sunsprit

Bringing a vehicle ... new or used ... into Colorado for registration will require the physical VIN inspection. A new vehicle may be exempt (coming in on an MSO) from an actual emissions test, but will be required to get the emissions decal for the windshield and display it.

At the point of titling and registration, you will pay the appropriate Sales Taxes due to the state, county, municipality, and any special tax districts here in Colorado based upon the address the car is registered to.

The "schemes" of yesteryear to "register" a car at a lower tax rate address are pretty much done and gone. The state and the cities are too jealous of their tax revenues anymore to tolerate this stuff and are very aggressive about cross checking and verifying where the car is really based. You simply cannot claim your infrequently used cabin in a remote county area of Colorado for your car location anymore and keep it mainly in the Front Range areas. Especially with the law enforcement folks looking for cars frequently seen in Denver (and the Front Range emissions area) without an Emissions sticker in the windshield. They will cite your car for being a frequent front range area car ... and they really do keep track, especially if your car is seen in the same parking lot areas on a daily basis.

Part of their efficiency about this enforcement now comes from the ability of law enforcement and insurance companies to cross check each other's databases via on-line computer data. You don't want to get caught registering your car at one address and having your insurance package at another residence with other vehicles there ... it raises red flags for the authorities, and they have a few folks who will actively pursue finding out why.

FWIW, Colorado's enforcement of this goes back well into the 1960's ... when I moved here with out of state plates as a full time out of state Univ student. I had a part time job and it only took the local sheriff's deputy a month to write a citation for getting Colorado plates on my car, because they saw it parked several times in the same employee parking lot. At that point, the burden of proof that you don't need Colorado license plates (and now, emission inspection sticker) is on you.

I even had Denver police recently write a citation for my Wyoming plated car when they saw it repeatedly parked in Denver for not having a front range user emission sticker. Yes, that's right .... even if your car is registered somewhere else and you are a frequent Denver commuter, you must have a Colorado emissions sticker. In my case, I was on a contract job in downtown Denver for 2-3 weeks, but I still had to file with Denver that my frequent car use was a temporary assignment. If I'd been there for over a month, then I'd have had to gotten an emissions inspection. The same goes for someone commuting into Denver from another county area which doesn't require the emissions inspection.

Good info, Sunsprit. Interestingly, when I registered a new vehicle in Wyoming that was bought in Colorado, they didn't do a VIN inspection, just took the info off of the MSO. Colorado is serious about all of this stuff. Since I have been back in Colorado on an assignment for more than 30 days (and I had sold my house in Wyoming before the mortgage meltdown ), I had to get Colorado license plates (hated losing my Wyoming plates ), so I guess that sort of makes me a Coloradan again (undoubtedly much to the chagrin of many on the Colorado forum). And, yes, I will be paying some Colorado income tax, too, for 2007. Oh, well . . .

[Charles]

So what I am getting out of this is that it really doesn't make a difference which state I purchase my car. The taxes and registration costs would be the same in either case (buying in Colorado or buying out of Colorado).

So if I bought out of state, I go to the dealer, hand him the money for the car with no tax. I drive it to Colorado. I go to the DMV in Colorado and pay tax and registration fees. Sound right?

[suzco]

Originally Posted by sunsprit

Bringing a vehicle ... new or used ... into Colorado for registration will require the physical VIN inspection. A new vehicle may be exempt (coming in on an MSO) from an actual emissions test, but will be required to get the emissions decal for the windshield and display it. . .
I even had Denver police recently write a citation for my Wyoming plated car when they saw it repeatedly parked in Denver for not having a front range user emission sticker. Yes, that's right .... even if your car is registered somewhere else and you are a frequent Denver commuter, you must have a Colorado emissions sticker. In my case, I was on a contract job in downtown Denver for 2-3 weeks, but I still had to file with Denver that my frequent car use was a temporary assignment. If I'd been there for over a month, then I'd have had to gotten an emissions inspection. The same goes for someone commuting into Denver from another county area which doesn't require the emissions inspection.

Hope this wasn't a very recent experience. The emission sticker for the windshield was eliminated in 2004.
www.revenue.state.co.us/Stats_dir/AR2004.pdf
(There is still a requirement for emissions testing in metro Denver, but there is no longer a sticker for the windshield.)