I leased a car in NY a couple months back and recently accepted a job offer in CA. I saw the post that had talked about people that lease a vehicle and moved to NY, but not the opposite situation.
I lease with USBank, and I’m assuming they paid the NY lump sum tax and rolled the total value in my monthly payments. If I register the vehicle in CA like I’m supposed to, is there a way I can indicate that sales tax was paid on the vehicle?
I can see three ways this goes:
I pay sales tax in CA on the payments all over again and I just am screwed.
I pay sales tax in CA but can claim a credit somehow for taxes already paid in NY.
I somehow convince the DMV I’ve paid sales taxes in NY and they add sales tax onto my lease payments.
Any advice on who I should reach out to next? CDTFA? DMV (please god no)? USBank?
I know that if you were in NJ moving to CA, you’d file for a tax refund which would be returned to you on a pro-rated basis. From there on you’d be paying sales tax on the monthly payments for your time in CA.
Thanks for the the responses! It sounds like I should file a tax refund form in NY for a prorated refund (for time the car was registered in CA) per @M3-Fast and then contact my lessor during the registration process to add the CA sales tax on top of my monthly payments per @max_g.
Ugh, okay. Compounding this issue is that the sales tax is rolled into the monthly payment – meaning that I would be paying sales tax on the lease cost plus NY sales tax.
Lesson learned:
Don’t live in a high tax state and
if you do, don’t move to another high tax state.
In all seriousness, the lease is still a deal with the additional 7% or so piled onto the payments so I’m not too upset, and it’s not like I could have known about the move before the lease. Let me be an example to future hackers about the possibility of paying a double tax burden on a lease.
Please read the NY state guides that I’ve essentially made on this here. NY will not refund you under any circumstances, even if you pay the tax up-front and the car is totaled on the way home from the dealership.
You should have a receipt for the tax paid by the dealership/lessor. You can try to provide that to CA to show the tax was paid, along with this form: https://cdtfa.ca.gov/formspubs/cdtfa101dmv.pdf
They may say that you are not the one who paid the tax, though, but it would be helpful to provide a copy of your lease showing that the tax is capitalized.
California otherwise doesn’t say much about whether you can be exempt from having the tax added to your payments.
The Dept. of Taxes and Fees has this but there’s no link to any of the information:
Again – thanks everyone for the advice – I love this forum.
Okay so as it stands – New York will absolutely not refund tax paid. My only hope for any sort of tax relief will come from navigating taxes on the California side while registering the vehicle – although I should be prepared for this not to work given @AP919’s post re: 12 month rule.
@M3-Fast and for those curious, this lease was a great deal – a '20 Toyota Tundra with an MSRP of 44K leased in April for 265 (taxes and fees included). Lease term is 24 months and 15K miles. If you add in California tax onto this, the total comes to 283 a month. The total amount of California taxes would be around 340 over the lifetime of the lease – which isn’t actually too bad.
At this price, this lease still beats a) the current deals advertised by that broker and b) any other deal offered around California. I should have no issues finding demand for the transfer and was thinking about transferring to a lower mileage lease, but this actually would be more expensive than just eating the new tax.
Long story short, I am prepared to pay 340 as an idiot tax so others may learn how to avoid this.
Yeah still a good deal lol. Just watch out for CA registration as I’ve heard it’s insanely high. Not sure if there’s any truth to that (something like 1% of MSRP annually)
How many months left w the car?? Can’t you just keep you state plates on there? Prob worse advise ever but anything to screw govt in ny or California is ok in my books
An angle that is potentially possible is that he could change the address on his registration to an NY PO Box. That will likely cost the same if not more than the total CA tax he’s going to end up paying…not necessarily a worthwhile pursuit.
Potential downsides:
1- Lets say he passes through a toll plaza & the ez-pass doesn’t scan for whatever reasons, the toll bill gets sent to his old NY address while he is in CA. The new tenant doesnt notify him of his tolll bill for whatever reason…ultimately his license gets suspended over a $1 toll bill he never knew about.
I just used the registration calculator – holy crap. Have to dig deeper into pockets.
I still have an address in New York – but this route is of questionable legality. I also have a MA license because I was in the military. In the situation where I were to be pulled over/got into an accident there would be serious questions asked which would probably lead to greater financial consequences than the ~$500 I need to pay for registration fees and the ~340 I could potentially lose in being double taxed.
When I was on active duty stationed here, it was legal for me to keep MA plates on my car. I was never pulled over once for it and so I could reasonably expect to avoid any trouble if I kept my New York plates, but I’m at that stage of my life where I’m a little more averse to risk. I may just pay everything. I’ll try a little harder to get tax credit for my sales tax paid in NY to try to offset the high cost of registration here, though.
