Hi all, my Audi S5 lease will end this year and I am going to buyout it. The vehicle is currently registered in NJ which requires upfront tax. That means I already paid all NJ tax on leasing amount at the beginning. However, I am currently living in PA and going to transfer my DL to PA as well. If I transfer my lease to PA, then I have to pay for PA tax upon the existing total monthly amount(including NJ tax). Definitely it is not a good idea. If I buyout it in NJ, then I only need pay for NJ tax for residual value. The dealer could help me with that do both together and pay for PA tax. But I have to pay for PA tax for the total amount (residual value + remaining leasing amount - lease charge rebate). You could see there is still a double tax there (remaining leasing amount - lease charge rebate). I am wondering if anyone here face similar issue and how do you avoid double tax? If I prepay all remaining leasing amount now, will it show on the final total amount? Or it wont change the total amount, and will receive a refund check after I buyout lease?
If you choose to buy your car at the end of the lease, you’ll pay tax on the RV regardless of where you live and where it was originally leased. You would have paid tax on the RV in NJ if you continued to live there, and you’ll pay tax on the RV in PA.
There’s no way to avoid this.
Understand that I have to pay tax on the RV. But my case is that I have to pay tax on (RV+remaining leasing future payment - leasing rebate) in PA if I buyout it now. I cannot wait till end of lease because my NJ address will be unavailable soon.
Chalk it up to the cost of moving.
I think this would work to avoid double taxation. It is basically like moving a one pay lease from one state to another. That said, I don’t know what the PA DMV would do if you move a leased car there with no payments remaining. Probably a pretty uncommon situation so their is definitely a risk of creating a bit of a mess.
I’d probably just move the registration to PA then buy the lease out. You pay tax on top of tax, but how much is that really? $100 or so i would guess.
If you buy the car in NJ, just make sure you keep all your paperwork. PA requires you to show tax paid if it has been less than six months.