2019 Volvo XC90 T6 Inscription - Should I pull the trigger?

2019 Volvo XC90 T6 Inscription

MSRP: $67,930
Selling Price: $61,500
Incentives: $5000 (Costco and dealer incentive)
Net Price: $56,500
Zero down Payment

Monthly Payment Pre/Post Tax: $642/694

Cash Due at Signing: $3,980 (Tax/title/license/dealer fees and 1st payment)

MSD:0 (I have other ways I’d rather use the money)
Months: 36
Annual Mileage:12000

Region: Southwest
Leasehackr Score: 8.7

No @Benedetto could prob do better, here you go:

Benedetto CALIFORNIA Volvo Deals for July - Spreadsheet link in post

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@212hackr From what I can see, this is very close.

For the T6 Inscription MSRP 68k, he lists $615 for 36/10, it would be $624 for 36/10 on my calculation with above prices.

The main difference I see is that Cash due is only 1500. I’m not sure how this is so different as I thought these are pretty much fixed taxes/fees?

T6 R for $515 w/ $67k stands out to me. Jmo.

But… for AZ this is a great deal

Costco ended last month.

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They said they would “extend it”. Either way, 5k in rebates.

Currently there is a $4000 rebate on the XC90 T6 inscription. There may be another $1k in dealer discount they are giving you, but there is no extension of the Costco program.


Ok, but 5k is 5k. Thoughts on the deal please?

How is your DAS $3,980 without a cap reduction and without up front tax?

Consider adding MSDs, whatever amount you are comfortable, and going zero drive off.

About 1,100 is title/registration fees for the AZ DMV. Around 900 is a capitalized cost reduction tax (a tax on the difference between the price of the car and the MSRP, is what they told me?), plus the first payment, and the rest of the fees like acquisition and dealer fees.

I think you can do better … Lease Hacker score isn’t the “end all” metric, but I’ve seen deals above 10 vs 8.7. For reference, I sealed a deal end of June on my XC90 with the following:

XC90 T6 R-Design
MSRP $73,275
Selling Price $62,423
Residual 60% (I know the residuals vary between Inscription & R-Design)
MF 0.00065
DAS (Due at Signing - includes 1st month) $1,704.34 (Paid $500 w/ a cash back credit card)
Monthly $597.34 (includes 6% KY tax on lease payments)

MSD - $6,000 (Paid half w/ a cash back credit card)
$100 Costco Cash Card (May/June Costco Incentive)
Dealer agreed to give me some accessories to sweeten the deal … nothing big but still nice :slight_smile:

When I was shopping around, I created a massive Excel file with at least 15 dealerships around the nation. I almost went with a dealership in GA who was actually cheaper but didn’t have one of the options I wanted and instead had 22" with Summer Tires which would not work in KY during the winter. Shipping was going to be capped at $500 but the monthly was something around $550 a month w/ tax so it was a sweet deal. Ultimately went local for the perks such as free towing for servicing to and from your house, etc.

I would shop around outside your state too … worst case scenario you can drive it back or have them ship it if its a solid deal!

Thanks @ekim629. Like you, I would prefer the relative ease of an in state dealer. California I guess would be relatively easy from here.

Unfortunately, the R-design and Inscription is comparing apples to oranges because of the significant difference in the money factor - 0.00065 vs. 0.00144 (less than half!)

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Money factor on the deal @ekim629 posted is only that low because of MSDs. I believe the pre-MSD money factor on the R-Design is 0.00115.

You may be able to get a little better discount before incentives. I would be concerned that they are messing around with something as far as the discount you are actually getting though.

Your first post says that there is zero down, but a few posts later you mentioned they are now telling you about a $900 cap cost reduction — to me that sounds like you paying for the alleged “extended” Costco program out of your own pocket.

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@adk here is a link explaining the cap reduction tax. Is this not a real thing and they are trying to screw me? Could this be an Arizona thing?


I have a feeling I know the answer, but I don’t want to give incorrect information.

Our resident tax expert, @AP919 may want to give some input.

Aside from anything else, why would you cite a newspaper as a tax source? That doesn’t fly.
*Plus, a Houston newspaper has no bearing on a state tax in Arizona.

“Tax on cap reduction” is just that - in most states, you pay tax on a down payment. If there’s no money down, it might be tax on the incentives. Before I look into this, I’d really like to see a deal sheet or at least the $3,900 accurately broken down.

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That was the only source I could even find, doesn’t seem to be much out there on this. I was told it was tax on the difference between the original MSRP and the final price after rebates.

That reduction is comprised of discounts, rebates/incentives, and/or down payment, if any. You can’t be taxed on an outright discount, no matter the state, because it’s not part of the selling price of the car. It’s like saying that something is on sale, say a piece of clothing or a TV, but you have to pay tax on the full price. The only difference for this scenario is when there is a coupon to reduce the price, because many states will tax you on the price before a coupon.

I just wanted to provide an update to this after doing more research. From what I can tell, certain states do in fact tax on incentives/discounts. The link below provides a table with info per state. Interestingly this shows that Arizona does not in fact tax on discounts/incentives and further makes me think this dealer is trying to screw me. From the link:

Rebates and incentives: Customer cash rebates and other incentives reduce the purchase price of the car. But most states charge sales tax on the full purchase amount before the rebate is applied. For a $25,000 car with a $500 rebate, that reduces the sale price to $24,500, but in most cases you’ll pay tax on the full $25,000.

In the chart below, look at the column labeled “Are incentives taxed?” If there is a “Y” in this column, it means the sales tax is based on the car’s price before rebates and incentives.