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 Posted: Fri Nov 13, 2009 2:38 pm Post subject: Sales tax due owed on vehicle value when buying back salvage |
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Hi,
My vehicle was totaled. We FINALLY came up with a value for the for the vehicle and a salvage buy back value. Now they are saying I will not get the sales tax on the vehicle value, if I choose to do the buy back. I am in Arizona. Is that even legal? |
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dusty91
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| Posted: Fri Nov 13, 2009 7:40 pm Post subject: |
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| I've seen many adjusters do this. I never have. IMHO, I think it's legal not to pay sales tax if your retaining the vehicle as sales tax would only be a part of your loss if you replaced the vehicle. If you don't replace it, you don't pay sales tax so it's not part of the loss. |
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tcope
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| Posted: Fri Nov 13, 2009 9:13 pm Post subject: |
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Thanks for the reply.
Sounds like a loop hole they will take advantage of if they can. I spoke to a supervisor and they are going to give me the tax and license. This has been a real test. When they orginally gave me a lowball offer, I countered with a very resonable offer. Now after a week of haggling back and forth, I am getting $200 more that I orginally offered and $2000 more than their original offer. My advise is stick to your guns if you think you are right |
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dusty91
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| Posted: Fri Nov 13, 2009 11:44 pm Post subject: |
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In my state, we issue the sales tax affidavit on all totals regardless of what happens to the salvage. But I agree 100% with T I don't think it's "owed" when you retain the vehicle.
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Lori
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| Posted: Sat Nov 14, 2009 6:07 am Post subject: |
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| I had to pay sales tax on my totalled car. I bought the car back & the hartford stole $123.00. They based the sales tax on what they gave me for the car (fair market value) $1,656.00. This was when ca sales tax was 7.75%. The salvage buy back was $160.00. I think they did me wrong. |
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steel09
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| Posted: Sat Nov 14, 2009 12:37 pm Post subject: |
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MAN! I thought I was bad at math....You're math is all mess up...the difference in the sales tax they paid you was only $12.40 (7.75% of 160.00)...
Or are you saying that when you bought the car..you upaid 123.00 in sales tax, and they didn't give you that (or any) sales tax when you retained your vehicle? Is that your beef?
Do you not understand that when you sell or trade this car (whenever that is)..you can ded the amount you paid for it, (or got for the trade in), from the amount of your newly purchased vehicle..thus reducing the sales tax (thereby getting that sales tax).
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"Never, never be afraid to do what's right, especially if the well being of a person or animal is at stake. Society's punishments are small compared to the wounds we inflict on our soul when we look the other way." Martin Luther King Jr. |
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Lori
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| Posted: Sat Nov 14, 2009 3:34 pm Post subject: |
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| Quote: | In my state, we issue the sales tax affidavit on all totals regardless of what happens to the salvage. But I agree 100% with T I don't think it's "owed" when you retain the vehicle.
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| Quote: | | I've seen many adjusters do this. I never have. IMHO, I think it's legal not to pay sales tax if your retaining the vehicle as sales tax would only be a part of your loss if you replaced the vehicle. If you don't replace it, you don't pay sales tax so it's not part of the loss. |
If you follow this logic, then it might be reasonable to state that you don't feel insurers owe for losses unless they fix damaged vehicles as a result of a collision or comp loss? Tax and registration are part of the value of the loss and are owed in my opinion. A person is owed every penny of a loss whether they fix the car or not unless a lien is involved. Policies state that they will pay money for all of the loss not just a portion of the loss and if the vehicle owner decides to buy penny candy with the money, that is their prerogative.
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MikeoftheOzarks
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| Posted: Sat Nov 14, 2009 4:39 pm Post subject: |
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| Quote: | | If you follow this logic, then it might be reasonable to state that you don't feel insurers owe for losses unless they fix damaged vehicles as a result of a collision or comp loss? |
There certainly are arguments to support either side of this argument. That is why I just pay it and call it a day. I did work for a carrier that would not pay sales tax on total loss vehicles until the person produced a sales receipt. Then, taxes were paid up to the sales tax based on the value of the vehicle damaged. But if they bought a less expensive vehicle then the lower sales tax was paid. It was a real pain in the butt. |
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tcope
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| Posted: Sat Nov 14, 2009 5:28 pm Post subject: |
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| The hartford did deduct $123.00 for ca sales taxe from my property settlement. They also deducted $34.00 processing fee & $160.00 salvage. My net was $1,656.00 for my 90 Tbird. |
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steel09
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| Posted: Sat Nov 14, 2009 7:16 pm Post subject: |
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| I have never paid it in MO or KS. |
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Trench
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| Posted: Sun Nov 15, 2009 12:36 am Post subject: |
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In MO you CAN'T pay it ... a sales tax affidavit is issued that is good for six month. If you don't replace the car what happen? Yep MO gets to keep that money.
In KS you're supposed to pay it, (cash) added to the ACV settlement (along with title transfer fees)
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Lori
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| Posted: Sun Nov 15, 2009 5:19 am Post subject: |
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| Quote: | | (along with title transfer fees) |
This yes, but I have never seen an insurer in KS pay taxes on a totalled vehicle the owner keeps. |
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Trench
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| Posted: Sun Nov 15, 2009 12:33 pm Post subject: |
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The carrier I work for does...every single time..as you know, due to our locales I can hit KS with a rock, and actually worked out of a KS branch for about five years.
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"Never, never be afraid to do what's right, especially if the well being of a person or animal is at stake. Society's punishments are small compared to the wounds we inflict on our soul when we look the other way." Martin Luther King Jr. |
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Lori
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