I have a question this is urking me in the worst way. I recently bought out my Accord Lease from Honda Financial. I sent Honda a check for the amount listed to fulfill the payoff. The amount due at payoff was like 19700 or somewhere near there. When I received the title there was a letter attached to it stating that included in the payoff was an amount of $288.89 of Pennsylvania sales tax. And Honda lists their tax ID on the bill of sale I’m guessing to make it easier for the lessee to make sure your paid sales tax gets to the state. Nevertheless, when I go to re-register the car in my name I’m told by a rep of a private DMV messenger service (PA allows some DMV tasks to be handled in the private sector) that there’s no way that’s all the tax that is due on the car. So the rep proceeds to bill for what Honda lists as the paid price on the bill of sale. Which was 18900 something… I left the DMV agency with a bill of $1400 including registration and other misc. fees. My question is was the sales tax satisfied based on what Honda billed? Has anyone else found themselves in a similar situation in the state of Pennsylvania?
What’s PA tax rate on auto purchases? That * $18,900 would be your tax due. Plus reg, title, etc.
Whatever the tax is, the government is going to get it. If Honda didn’t collect all of it, guess who will? The friendly folks at the dmv
The PA state sales tax was not satisfied with Honda collecting the $288.89. You should contact them and ask what specific sales tax the $288.89 represents. In PA the DMV collects the sales tax (6%, but can be higher for different counties) plus other misc fees. Based on your buyout price the $1400 sounds correct.
The buy out price may include a “Purchase Fee” that Honda wants and they may not have paid any taxes on your behalf. Ask them now!
I am now in this same boat. My bill of sale on my Honda Pilot (also PA) lease buyout shows the dollar amount plus some $300 in taxes paid. The DMV wanted to take the 6% of what I would owe on the sales price and subtract the $300 in taxes paid. I walked out because it didn’t seem like they knew what they were doing. I don’t know what the heck Honda collected taxes for on my buyout. I doubt they’re paying a small portion of my future sales tax owed during the title transfer, though.
Also - I did not expect the $1700 tax bill. That’s a kick in the nuts. I financed through PSECU. They should know that and let me roll it into the loan.
Sounds more like the purchase option fee than taxes paid.
It reads, “plus $308.22 of Pennsylvania state sales tax” then lists their tax ID#.
everything on the case
PA has a weird lease tax in addition to the normal sales tax.
How come I keep hearing about a purchase option fee, isn’t it true that if you go to Honda financing corporation you won’t pay a single dime to buyout your lease???
Or does this vary by state?
What does your contract say?
I did this a few weeks ago. The payoff amount on the Honda Financial website was $18,XXX. Did an ACH transfer from the bank in that amount, and it showed in paid in full, and about a week later I got the title in the mail.
Went to the DMV today to transfer the title to my name, and that’s when they collected the sales tax on the payoff amount.
So, the payoff amount does not include sales tax. That is collected when you transfer the title to your name at your local DMV.
I believe this varies from state to state. The last time I called honda they told me that my payoff amount on my monthly bill includes the taxes.
Yeah sometimes the bank will collect the Tax and other states you will pay at DMV its in the fine print if you get your payoff quote online
I just called HF today with the same question (hence why I’m reading this string.) about sales tax. It is not included in the buyout amount.
It varies state by state.
On my payoff amount it DOES include the taxes .
Now if I extend the lease which I’m going to do, honda wants all taxes paid up front. It’s only about $25 a month. So if I extend it 5 months I have to give them a check for $125, but the payoff on my monthly statement does include taxes. I called them yesterday and asked.