Google rating is below 4, but reviews mostly complains their service department
Signed today, turns out not that bad. Salesman did send a screenshot after we push
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What was the deal for? MSRP? Might be looking into an ID4 later
These are now well under msrp, per marketplace
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Near 10% off, but MF was marked to 0.0038x from dealer (not matched to 0.0040x from my calculator although). There are several dealer provide 3200 off on their website for 22 Pro S
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Right now the biggest issue is there is Stop Sale for most 2023 model so I was only looking for 2022 model but the inventory is limited. On the hand the market is definitely cold, I spend half day at the dealership and not saw anyone came in to test drive. Last Thursday we went to a dealership provide 3200 off shown on their website. They said they havenât sold any car since April but the best they can do is 3200 off so we walk away. And on the 2nd day they call me back but they still cannot provide more discount. I guess if you are not hurry and can wait there may be more discount available.
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Note for VW leases you have to pay tax on the contracted monthly payments so higher MF increases your taxes a bit, so do the math I guess
Thx, as I mentioned I plan to buyout as soon as possible, so higher MF should not be a big problem
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At buyout, you pay tax on all contracted lease payment, so 24 months of payments x monthly payment x tax rate.
It doesnât matter if you buy out after a day or 24 months, you still pay the full contracted tax amount. You do get back the interest/rent if you buyout early (but not the tax on the interest)
hmm are you sure? I thought since I only need to pay partial interest/rent charge then why I still need pay tax from all interest which never happen on my contract?
Reddit - Dive into anything check here as author posted both lease contract and VW payoff page, you can see the remaining payment is 214xx which is roughly 35 times the pretax payment and then minus the rent charge, tax seems not included in this calculation
How taxes are handled has nothing to do with the lessor and everything to do with what state youre in.
Since we are talking about california here, tax will be due on the buyout value of the vehicle. The remaining payments are irrelevant.
If we were talking about a tax upfront state, then yes, the mf would have an effect on the taxes that were paid.
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Yep in California the VW âresidual/payoff taxâ = âremaining future paymentsâ * tax rate. Itâs confusing because of the /, but in CA is only payoff tax. And then thereâs additional tax on the residual that you pay at DMV upon title transfer and reg.
Youâll see they kept the same residual as a end of term payoff and the residual/payoff isnât enough to cover both, so otherwise youâd skip out on the depreciation tax all together.
In California, the leasing company can do (at least) three things for early terms - make you pay all remaining monthly payments incl tax then rebate the interest, OR adjust the monthly payment downwards (tax goes down accordingly) OR waive payments and adjust the residual upwards. VW does the first option where you end up paying tax on the interest, whereas BMW does the later.
In that reddit thread â It amounts to 7.75% of only about half that and is exactly the $224 a month I had remaining in the next 35 payments. So I think it means the taxes I would have paid over the course of the lease.â Indeed matches the math I outlined above.
Once you OP gets the payoff in 2 weeks, please post to confirm the math is exactly as I describe.
It takes two to tango. For example, Mercedes structured their EQS âwelcome to electricâ incentive to be dealer cash vs a consumer rebate, which made it non-taxable.
In this case, yes VW chose the worse possible lease accounting (rebating the interest) for California tax treatment and therefore you pay tax on interest you got ârebatedâ (in reality never really paid)
Iâm pretty sure when VW is calculating the payoff it excludes the unused rent charge. Itâs not simply a calculation of ending residual plus all unpaid payments. Higher mf will lead to a higher rent charge which is then adjusted for in the payoff amount. If you intend to buy out immediately all you really care about is getting the lowest cap cost possible.
See my post above.
Also the reddit link the OP included says
âIt amounts to 7.75% and is exactly the $224 a month I had remaining in the next 35 payments. So I think it means the taxes I would have paid over the course of the lease.ââ
In CA with VW: Higher mf = higher payment = higher tax
It does not make sense vw is doing it that way. Not sure how you would challenge it, but theyre charging taxes on services not performed.
Best bet is for any impacted/prospective VW/Audi/Porsche CA customers to contact the VW America & VWC CEOs and ask them to look into it. They totally can honor the lease contract by charging you just the remaining depreciation instead of full monthly - rebate interest (which maybe in some stats is the same thing but not in CA).
Im not talking about the application of the incentives (the way MB does this is odd, even if itâs in your favor). Im talking about the sales tax application on the buyout.
Yes Iâm talking about the âmonthly payments lineâ in the buyout.
The VW lease contract says you only owe the depreciation. They figure charging Full Monthly Payment and Rebating the Interest = charging Depreciation. But itâs not true for tax purposes and theyâre being lazy (maybe because in some states it is equal) or just less customer favorable.
They could either charge for the calculated Depreciation or keep their calculations as-is but make the ârebateâ a âreductionâ instead.
I suspect if enough customers complain and/or take them to arbitration (they have to pay administrative costs) theyâll fix this to be in-line with BMWFS etc. Itâs no skin off their back to ensure California lease buyout are California sales tax optimized.
