Yes, your formulas are correct except, youâ€™re missing a parenthesis in the **last formula far right**â€¦

Monthly Rent Charge = (F * N * (Q + R) ) / (N - (1+t)*(F*N +1)**)**

Just to make sure that weâ€™re on the same pageâ€¦

Weâ€™re considering zero drive-off (ALL fees are capped including 1st payment). Weâ€™re also considering only those states (e.g., CA, PA, FL, WA, NC) that tax the monthly base payment streams where both taxable and non-taxable fees are capped when computing the base payment and so, tax is levied on tax which is an undesirable consequence of levying tax on payment streams. I think you taught me that!

**NOTE: As you know, the formula below will be different for those states the levy tax on the sum of the base payments (e.g., Ohio, NJ). And, as you are keenly aware, NY and Illinois also tax the sum of the base payments. However, they require the use of a rather unusual formula that accounts for their unique taxing methodology that utilizes a â€śgross-upâ€ť tax factor. The formula is also different for those states that tax depreciation (e.g., GA). as well as sell price (e.g., VA, TX).**

The following formula and example assumes that tax is levied on the monthly base payment streams (not the sum of the base payments) with zero drive-offâ€¦

PB = base payment

Contractual Payment = PB(1 + Ň)

S = sell price = 65295.00

D = cap reduction = 7500.00

X = Sales tax on the cap reduction = 675.00

K = all fees capped both taxable and non-taxable = 1794.00 (acq, doc, gov., ect.)

R = Residual Value = 37786.35

N = term =36

F = money factor = .00295

Ň¬ = sales tax rate = 9.00%

Note: You can combine X and K. I just prefer to itemize them separately.

Contractual Payment = 945.29 x 1.09

= 1030.37

Calculating the monthly depreciation and rent charge components, we have

??? Please let me know.