Moving to Texas with a leased car

I searched within the forum and also outside but don’t have a definitive answer so asking this question.

Moving to Texas with a leased car. What are the tax implications.

Worst case that I have heard is that the sales tax needed to be paid in full basement on the original msrp which is going to be 3k+ in my case.

Best case is that I would only have to pay $90 to get new Texas tags.

Can the gurus here help or if anyone has moved recently can share their experiences.

Looking to move to Dallas metro if it helps.

There shouldn’t be any implications. You leased it pursuant to the laws of the state in which you currently reside. Just because you move out of state, you do not trigger a re-jiggering of the tax.

Rather than trust anonymous posters, look for it on Texas Gov website

Do I owe tax if I bring a leased motor vehicle into Texas from another state?
When a vehicle is leased in another state and the lessee brings it to Texas for public highway use, the lessee (as the operator) owes motor vehicle use tax based on the price the lessor paid for the vehicle. The standard tax rate is 6.25 percent. Credit will be given for any tax the lessor or the lessee paid to another state.

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If @vhooloo is right, then you’re wrong.

Unless you know the tax codes of all 50 states, I would call that a gross generalization, at best.

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I’m not one to argue with the TX gov website, if that’s what it says, it must be so. I’m pretty surprised. I have some friends who will be more surprised. LOL.

My understanding based on some cousins who recently moved to TX is that they won’t charge you additional tax if you’re already paying it on the lease and have held the car for a period of time before moving. They weren’t charged anything beyond what they were currently paying when they went to register the car. Of course, this was several years ago and it’s hard to argue with a pretty clear-cut answer from the State.

I have seen this and this seems very ambiguous.
Since the vehicle is not new as it is entering TX, should I owe taxes based on as new prices or on the blue/black book value as now.

Also, even if the tax rate is assumed as same, being hackers, the tax paid in original state for say 6 months at a 1% perlease would be 6% of vehicle MSRP @ 6.25 (assuming this is rate of origin state). Now TX will charge 100% of vehicle MSRP @ 6.25. So the credit is going to be peanuts.

For a $50,000 vehicle, in origin state for 6 months, I would have paid $200 as taxes.
For this 6 month old vehicle, TX will want me to pay $3,000 as taxes. Dosen’t seem justifiable.

Wonder if someone has moved in the past year or so and could provide a personal anecdote.

The verbiage posted above isn’t ambiguous at all. It says the tax is based on price paid by the lessor, ie the selling price on the lease.

e) Motor vehicle use tax is due on a motor vehicle purchased outside of the State of Texas and leased and brought into the state for use upon the highway. The lessee of the motor vehicle is liable for such tax. If the lessee is a resident of this state or is domiciled or doing business in this state the tax is based upon the consideration paid outside the state by the purchaser of the motor vehicle, regardless of any use or depreciation of the vehicle subsequent to its purchase and prior to its use in this state. If the lessee is a new resident of this state as described in §3.71 of this title (relating to Definition of “Resident” and “New Resident”), the new resident may pay a new resident use tax of $90 imposed by Tax Code, §152.023, in lieu of the 6.25% use tax.

This is straight from the Texas Administrative Code.

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You don’t pay tax on the whole car, it’s a $90 tax.

What @vhooloo posted is if you lease the car out of state and bring it into Texas, while already a resident of Texas.

Also from the Texas Government website:

https://comptroller.texas.gov/taxes/motor-vehicle/sales-use.php

New residents – $90 new resident fee due in lieu of use tax on a vehicle brought into Texas by a new resident, if the vehicle was previously registered in the new resident’s name in another state or foreign country.

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This is very welcome news.

So my monthly lease payments after the $90 use tax and tag fees would continue to attract 6.25% tax on just the monthly payment amount?

No. You will pay $90 when you move into the state and register within 20 business days and then you will not pay tax on your lease payments at all.

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There is one more thing to consider in Texas. Municipalities are authorized to assess property tax on personal use leased vehicles. There are eight of these municipalities in Dallas county alone and probably a lot more in the Metroplex. Here is the list for just Dallas county, I just moved to Frisco in Collin County and they DO assess the tax as well.

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what would happen if you drive the car in Tx but keep it registered (with family etc) wherever you’re from? I see residents on FL with out of state tags here in FL all the time.

Technically it’s tax fraud. Also insurance fraud if you don’t tell insurance you moved. That said, there is pretty much never any reprocussions for doing so. Just make sure the address on file is somewhere you can get mail.

In NOVA where there is an annual car tax a large number of cars retain out of state plates.

Are there technically legal implications? Yeah you can get charged a fine depending on the state.

Will anything actually happen? No, probably not.

I’ve moved across state boarders and not re-registered. Nothing happened.

Your insurance could deny you in the event of a claim

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This - so much this. My sister was a doctoral student in california, but had her car with her (in my Dad’s name) registered and insured in PA. She totaled it on I-5 after a car in front of her jammed their brakes unexpectedly.

The insurance company ultimately paid it, but basically told my parents that another claim from that far away would be denied.

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Just want to confirm that if you move to Texas with a leased car, there is a single $90 fee in lieu of sales tax. So if you are thinking of leasing, do it before you move and you can save a a few thousand dollars.