I know when you trade in a car and buy it you get a tax benefit by only paying tax on the difference (ex. New car 30k, trade in 20k, you only pay tax on the 10k difference).
I have a 2019 QX60 (owned free and clear) I am contemplating trading in for a lease. I want to cash out the majority of the value. Will i get any tax benefit on the new lease since i am trading a car? Or no benefit since i am cashing out?
Only whatever you don’t cash out, tax benefits must be applied to a new car in the same transaction.
I made the mistake of thinking I would get tax credit for trading in my car for a lease. No credit given (I live in NY. Car was leased from PA. Not sure if it’s different for each state)
That is what i was afraid of. But then i started thinking from this perspective. If i had a loan on my old car and was just breaking even on the value, technically i wouldnt be putting any of it towards the new car but wouldnt i get the tax benefit anyway? So thinking from that perspective i figured i might be ok.
In my experience, in NJ, this will vary from dealer to dealer.
Details of the new lease?
Havent gotten any quotes. Just ballparking for now based on available info on residual and mf and stuff.
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