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Leasing Question

pfgray2008pfgray2008 Posts: 24
edited May 2016 in General
I'm attempting to put together a deal to lease a vehicle from a California VW dealership and register the vehicle in Oregon where I live. My state has zero sales tax which will save me plenty of money when purchasing a vehicle. The salesman I'm dealing with is claiming "that if a car is drives any time on CA roads taxes are due" This is [non-permissible content removed] I know this isn't true. But it gets better according to this guy, in order get around this issue the car would have to be trucked to the California's boarder and signed over. Has anyone heard of such nonsense?

Answers

  • kyfdxkyfdx Posts: 119,734

    I'm attempting to put together a deal to lease a vehicle from a California VW dealership and register the vehicle in Oregon where I live. My state has zero sales tax which will save me plenty of money when purchasing a vehicle. The salesman I'm dealing with is claiming "that if a car is drives any time on CA roads taxes are due" This is [non-permissible content removed] I know this isn't true. But it gets better according to this guy, in order get around this issue the car would have to be trucked to the California's boarder and signed over. Has anyone heard of such nonsense?

    It's true. If you take delivery in CA, you pay CA sales tax. Of course, if you put zero down on a lease, and register it in Oregon, then there won't be any CA sales tax due, except possibly for the first month.

    Road tax? If that's something different than sales tax, then yes, you'll have to take delivery out of state to avoid it.

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    Edmunds Moderator

  • pfgray2008pfgray2008 Posts: 24
    Thank you for pointing that out, I totally overlooked that sales tax would only apply to acquisition or drive off portion of lease. Hell even the tax code experts forgot to mention this. I called the California DMV, Vehicle Tax Board in Sacramento needless to say they could not precisely point to the section of the tax code or provide solid examples of exemptions. I wasted hours with these people and the 2 I reached a human I got very different interpretations.
  • kyfdxkyfdx Posts: 119,734

    Thank you for pointing that out, I totally overlooked that sales tax would only apply to acquisition or drive off portion of lease. Hell even the tax code experts forgot to mention this. I called the California DMV, Vehicle Tax Board in Sacramento needless to say they could not precisely point to the section of the tax code or provide solid examples of exemptions. I wasted hours with these people and the 2 I reached a human I got very different interpretations.

    You can roll the acquisition fee into the lease as well.

    I'd try really hard to find a dealership in Oregon. Doesn't seem worth the hassle. If there is some incentive available in CA that isn't available in Oregon, it may be based on owner registration location, as well. (Something else that could bite you).

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    Edmunds Moderator

  • tigerheeltigerheel Posts: 18
    Do all lease changes (MF, residual, etc) change on first of the month?
  • kyfdxkyfdx Posts: 119,734
    tigerheel said:

    Do all lease changes (MF, residual, etc) change on first of the month?

    Not necessarily. Sometimes, it's quarterly or bi-monthly, depending on the make. And, it's usually the first Tuesday after the 1st of the month, when it does change.

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    Edmunds Moderator

  • tigerheeltigerheel Posts: 18
    So I guess I need some advice. My Lexus lease is done June 5th. I can drive my son's car for a week and wait and see what new deals come out early June on the cars I am looking at. Or will this likely make the issue worse? Is there a typical difference for better or worse as we enter summer?
  • MichaellMichaell ColoradoPosts: 110,082
    tigerheel said:
    So I guess I need some advice. My Lexus lease is done June 5th. I can drive my son's car for a week and wait and see what new deals come out early June on the cars I am looking at. Or will this likely make the issue worse? Is there a typical difference for better or worse as we enter summer?
    Hard to predict what the numbers will be for future months. Lexus residuals are valid until July 5th. 

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    2016 VW Jetta 1.4T SE / 2015 Subaru Outback 3.6R / 2014 MINI Countryman S ALL4

  • tigerheeltigerheel Posts: 18
    I am mainly looking at RAV4 andCX5 now - trying to reduce payment
  • kyfdxkyfdx Posts: 119,734
    tigerheel said:

    So I guess I need some advice. My Lexus lease is done June 5th. I can drive my son's car for a week and wait and see what new deals come out early June on the cars I am looking at. Or will this likely make the issue worse? Is there a typical difference for better or worse as we enter summer?

    Residuals won't change, but the current MF/incentive programs are due to expire on May 31st. IMO, the risk of waiting is small, as residuals are set through June. However, that's just an educated guess.

    If my lease was up on June 5th, I'd be looking to see what's out on the lots now, though.

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    Edmunds Moderator

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