Tax question about registering out-of-state leased car in CA

elau124

I'm registering a TX leased car in CA. TX collects tax upfront but I rolled it into my monthly payment. Now that I moved to CA, I have to pay CA tax on my monthly payment. I was told that I do not get tax credit for a TX leased car in CA. So my understanding is now I have to pay TX tax on the car's value + monthly CA tax on base payment (excluding rolled in TX tax) + monthly CA tax on the rolled in TX tax. Is that correct?

Thanks.

kyfdx

elau124 said:

I'm registering a TX leased car in CA. TX collects tax upfront but I rolled it into my monthly payment. Now that I moved to CA, I have to pay CA tax on my monthly payment. I was told that I do not get tax credit for a TX leased car in CA. So my understanding is now I have to pay TX tax on the car's value + monthly CA tax on base payment (excluding rolled in TX tax) + monthly CA tax on the rolled in TX tax. Is that correct?

Thanks.

That's correct. Moving from an "upfront" tax state to a monthly tax state with a lease hurts.

And, it wouldn't matter if you rolled it in, or paid it upfront. The tax in TX gets paid to the state upfront, either way, and you can't get it back.