Hi I am hoping to sell my current car to carvana and take the proceed from the sale and use it as down payment for the new car from the audi dealer.
Based on the description from the new york gov, it seems to be possible as long as the dealer you make the purchase is willing to work with you and treat the old car sale proceed as “trade-in”. https://www.tax.ny.gov/pubs_and_bulls/tg_bulletins/st/taxable_receipt.htm
I was wondering if anyone has pulled off the transaction and able to save sales tax from the old car value; if so, would really appreciate if you can share your experience, which dealer for buy and sell, and any particular needs to be watching out for.
What you are describing is very common and takes place at all car dealers in applicable states; wherein, only the sales amount less/minus trade-in value is taxable.
This is where you may be mixing things up; a trade-in only occurs when both transactions take place at the same dealer (trade-in and purchase of new car), in the same transaction. Trade to Audi dealer, buy new car from the same Audi dealer at the same time.
The article you linked states the same under “trade-in” - As a seller (dealer), when you accept something as a trade-in and reduce your selling price accordingly, sales tax is only due on the reduced price
What you are describing (Carvana, Audi) are two separate transactions and have no bearing on a trade-in. You sold your car to Carvana, and bought one from Audi - there is no trade-in.
To build off of what Kit is saying, you’ll receive addtl savings for trading in your car at the audi dealer. Additionally, some leasing companies have restrictions on how or where you can sell your lease to (assuming it’s a leased vehicle).
You’ll have to factor in tax savings to see if Carvana or Audi is a better dealer to sell the car to. You’d only be ‘trading’ at Audi, as you’re trading it for a new Audi. Are you buying the new car or leasing it?
Let me guess. Carvana is offering more for your current car than the Audi dealer. No surprise there. The dealers know they can offer less for your trade because of the tax savings on a new car purchase, and they take advantage of it. The best you can do is work with different dealers to see who will give you the best overall deal. Maybe some of the Audi brokers here can help facilitate your best deal.
Yeah I guess it is have to be the same buyer and seller… Just feel like the government should not limit the case to same buyer and seller as to me, it is all the same behavior, sell old car and buy new car. But I guess government also doesn’t have incentive to expand the case as they want to collect as much sales tax as possible.
I will try! haven’t heard from audi dealer of their offer but to be honest, I think it is hard to beat carvana offer even if considering the sales tax diff. But will share back when I receive trade in offer from the audi dealer!
Not sure about NY, but alot socal dealers are doing 10% off msrp for most 23 models. It says excluding S/Rs models but I’ve tried contacting some random dealers and they are willing to do 11%+ off 23 high msrp sq5’s
Oh thank you for sharing the info! Hope I can get another few % off. Do you know if the msrp off from those dealers includes the $5,000 Audi credit? Most in NY, I saw it is 6% off and with $5,000 credit, but if consider the credit as msrp off, then the discount is at 12.6% off.