If you didn’t already know, the following states apply a “Personal Property Tax” on all leased vehicles:
Arkansas, Connecticut, Kentucky, Massachusetts, Missouri, North Carolina, Rhode Island, Texas (haha I always found it funny how when you flip the A and the E in Texas, you get Taxes, LOL), Virginia, West Virginia and Orleans Parish (Louisiana).
Another state that have crummy tax laws is Illinois. I hear they make you pay taxes on the ENTIRE value of the car, not just the depreciation. Talk about unfair.
I always found it hard to find a comprehensive list of states that show how they tax leases. I think it would be a great idea to perhaps start a list. Feel free to chime in with how your states taxes you for your lease.
I know in California, we get taxed for only the depreciation+financing part of our payment on a monthly basis.
Anyone else?
2 Responses
Kudos to Dianne from Houston, TX for providing me with the following information about Texas tax laws.
Vehicles NOT Subject to Standard Presumptive Value Taxation
* New vehicles
* Vehicles purchased from licensed dealers
* Vehicles purchased at a governmental or foreclosure auction
* Vehicles 25 years old or older
* Off-road vehicles, such as dirt bikes or all-terrain vehicles (ATVs)
* Salvage or abandoned vehicles (except rebuilt salvage vehicles)
* Vehicles sold through a mechanic or storage lien
* Vehicles given as gifts
* Even-trade vehicles, when vehicles of equal value are swapped by the owners
FYI…Arkansas, Maryland, Minnesota, Texas and Virginia charge sales tax on the entire sale price.