"Forced" to trade

[ChuckA]

If you sell a car for more than you paid for it, you incurred a profit which is treated as a capital gain to the IRS (and subsequently to most states), so this is reflected in income tax filings... Most of us never see this situation, but OP may have had a sought after 'vette.

Technically correct, but does anyone declare the gain from the casual sale of a vehicle? I wonder how the dealer would handle if the trade-in was greater value then the replacement vehicle purchased. I assume sales tax would be $0 but are they required to issue a 1099?

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[NY_Cade69]

Interesting concept, since dealers already buy cars from people, as a direct purchase, they probably already have the means to handle it.

It's all recorded on the sale/transfer documents - in Connecticutt = CT DMV H-31
which is shared (along with all the other title info) with the US DOJ NMVTIS and other agencies...

If the gov't thought they could go after $600 in sales on eBay, you think they are not watching this as well?

 

[KennyMc]

Has anyone posted the actual stipulation that says a seller pays a sales tax on the amount of the sale?

 

[NY_Cade69]

Has anyone posted the actual stipulation that says a seller pays a sales tax on the amount of the sale?

No such thing...They do, however, need to file and remit any sales tax collected from customer sales...

 

[shutterbug]

If you sell a car for more than you paid for it, you incurred a profit which is treated as a capital gain to the IRS (and subsequently to most states), so this is reflected in income tax filings... Most of us never see this situation, but OP may have had a sought after 'vette.

That's what I thought and said, but OP claims that CT charges the seller tax.

 

[ralteredstates]

That's what I thought and said, but OP claims that CT charges the seller tax.

I lead you astray. I loose the tax break if I sell it outright (buyer must pay sales tax). When traded in, the tax payed is less because it's based on the final purchase price. I would have lost over $7000 if I sold it outright. Trading it in was financially better.

 

[NY_Cade69]

I lead you astray. I loose the tax break if I sell it outright (buyer must pay sales tax). When traded in, the tax payed is less because it's based on the final purchase price. I would have lost over $7000 if I sold it outright. Trading it in was financially better.

Everybody rails on CT taxes, but that would have taken the cake!

 

[KennyMc]

No such thing...They do, however, need to file and remit any sales tax collected from customer sales...

Remitting sales tax collected is different than paying a sales tax on something you sold. That boggles the mind. I would like to see that statute/tax code/etc. that stipulates that.

 

[NY_Cade69]

Remitting sales tax collected is different than paying a sales tax on something you sold. That boggles the mind. I would like to see that statute/tax code/etc. that stipulates that.

Not to worry, OP recanted.

I lead you astray. I loose the tax break if I sell it outright (buyer must pay sales tax). When traded in, the tax payed is less because it's based on the final purchase price. I would have lost over $7000 if I sold it outright. Trading it in was financially better.

 

[sport19]

Doesn't apply in OP's case, but you may check your state law regarding this. I live in Kansas and in 2025 they setup a process where you can request a refund for the 'excess' sales tax paid on your new car if you also sell another car within 4 months.

In my case I bought the car from Ford, sold a different car to Carmax and was able to get a $2k sales tax refund after ~3 months (typical govt wait time stuff). Definitely more work than simply trading to the dealer, but in my case made the purchase much more straightforward and didn't tie me to trading the car to save on sales tax dollars.

https://ksrevenue.gov/pdf/st-21vt.pdf

 

[Matts13]

Good luck with the new baby. You should be able to get sleep again in about 10 years...

Maybe lol

 

[ensign_lee]

If you already had four door crossover (the Mach E) why did you need to ditch the Corvette for the baby?

As someone who is about to have a baby this month and have this exact combo (C8 + Mach E GTPE), I too am curious.

 

[NY_Cade69]

As someone who is about to have a baby this month and have this exact combo (C8 + Mach E GTPE), I too am curious.

Baby and Mom need Active Remote Park Assist, HUD and this to placate Dad losing his status as 1st...:

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