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I don't know for sure, but I'm assuming you are taxed on fair market value, not on the actual purchase price. If the latter, I'm assuming people might try and "buy" their vehicle from a friend or family member for well below market, thereby decreasing their tax basis. So, the tax bill, based on retail value for a '97 CR-V should be around $7,000 (assuming around 15k miles a year were put on since purchase). Someone correct me if I am wrong though, this is just an educated guess.
As someone who deals in the trading industry, I'm a firm believer in things are only worth what another party is willing to pay. Period! Not what someone tells you it is worth. As an art collector, I find this to be all too true. I can't count how many times fellow collectors have bragged about this piece of art being worth this or that amount. My response is always the same. "Try and sell it, then tell me what it is worth." Usually about 50% of their original thoughts on the piece, lol.
So, to the big bad car tax entity, my vehicle is only worth what someone would reasonably pay for it. Period. Sure, that 2007 diesel Dodge Ram loaded with all the options might have just been sold to me last year for $43,000, but due to the oil crisis, nobody is buying them. Right now you would be lucky to fetch $25,000 for it at one year old. Yet I'll bet the DMV still states it is worth about $38,000 as 1 year old vehicle.
On the other hand my one year old Prius I paid $26,200 for, probably could sell for $24,500 right now because everyone and their cousin's dog wants one.
Thanks for posting this. It helps understand the tax issue. I take it there isn't a fee for registration every year on top of the tax plus the fee for obtaining and filing the yearly inspection?
Quote:
Originally Posted by Funky Chicken
Nobody likes to pay taxes, including me, but I find the reaction to the "Car Tax" to be pretty silly, especially when we are comparing our taxes to New York, New Jersey, Florida, or anywhere else where Real Estate and Sales Taxes are simply INSANE.
I wouldn't necessarily categorize people's reaction to a serious matter like a tax silly. Everyone comes from different situations, backgrounds and perspectives. Some people's tax burden is also far less than others for various reasons including their ability to itemize or financially hire a person to rework their burden to next to nothing (indicating that the percentage is not always equitable). Not being nitpicky, but I think everyone has a right to dislike a tax as well as question, audit and continually look into and expect an explanation as to how that tax money is being spent and if it is equitably and fairly being distributed among the masses. Categorizing people's reaction as silly only minimizes their right to have a valid reaction to someone or something taking their hard earned funds away for something they may not agree. And besides, taxes and tax laws aren't necessarily easy to understand and straightforward. For someone coming into the state, there is a lot that can be confusing. And, as you said, it's relative to where they are coming from. That's all.
Wow! I think we would definitely be ahead after leaving CT! I drive a 5-year-old mini van and almost pay $400 per year! It's a minivan, not a sports car for crying out loud! My husband drives a 10-year-old Buick that he's looking to sell, and we may have to do that here in CT since we have to take both cars down to NC if we move. Taxes are due in July here in CT, so maybe we can get out of it if we're lucky! Thanks for all the helpful info!
Thanks for posting this. It helps understand the tax issue. I take it there isn't a fee for registration every year on top of the tax plus the fee for obtaining and filing the yearly inspection?
I wouldn't necessarily categorize people's reaction to a serious matter like a tax silly. Everyone comes from different situations, backgrounds and perspectives. Some people's tax burden is also far less than others for various reasons including their ability to itemize or financially hire a person to rework their burden to next to nothing (indicating that the percentage is not always equitable). Not being nitpicky, but I think everyone has a right to dislike a tax as well as question, audit and continually look into and expect an explanation as to how that tax money is being spent and if it is equitably and fairly being distributed among the masses. Categorizing people's reaction as silly only minimizes their right to have a valid reaction to someone or something taking their hard earned funds away for something they may not agree. And besides, taxes and tax laws aren't necessarily easy to understand and straightforward. For someone coming into the state, there is a lot that can be confusing. And, as you said, it's relative to where they are coming from. That's all.
I don't think you are being nitpicky at all, and I agree with 100% of what you said.
The reason I chose to post this information at all is that if you do a search on this topic you will find multiple threads discussing the "car tax". None of them contain any of the information I presented, and IMO all of them contain negative reactions to the tax that are not based on the actual numbers. In a lot of cases the negativity towards the car tax comes from people who live in states that have a tax burden that towers over ours here in NC.
I don't know for sure, but I'm assuming you are taxed on fair market value, not on the actual purchase price. If the latter, I'm assuming people might try and "buy" their vehicle from a friend or family member for well below market, thereby decreasing their tax basis. So, the tax bill, based on retail value for a '97 CR-V should be around $7,000 (assuming around 15k miles a year were put on since purchase). Someone correct me if I am wrong though, this is just an educated guess.
So, does anyone want to buy it for that price? LOL That's 3 times what I paid for it!
I don't think you are being nitpicky at all, and I agree with 100% of what you said. The reason I chose to post this information at all is that if you do a search on this topic you will find multiple threads discussing the "car tax". None of them contain any of the information I presented, and IMO all of them contain negative reactions to the tax that are not based on the actual numbers. In a lot of cases the negativity towards the car tax comes from people who live in states that have a tax burden that towers over ours here in NC.
You're right about that, FunkyChicken. And I must say that given your OP, it definitely puts in better perspective the whole car tax issue better than most. Thanks for starting this thread!
The part I was personally unclear about were registration fees (I may have simply misunderstood or missed something here). I figured we would be paying registration fees on top of a yearly tax as well as the fees incurred with the inspection (all that adding up to a heck of a lot of money). And 3% is a whole lot less than sales tax in another state... unless that state doesn't have sales tax. Anyway, I'm guessing the property tax takes the place of the registration fees that I currently pay in CA?
You pay renewal fees yearly, inspection fees yearly, and property tax yearly.
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