MF: 0.00203 (fully marked up from .00163 base) → 0.00143 (one pay)
Residual: 70% minus 7,500 mileage → 68.1%
Term: 24/7.5k
Calculator (as close as I could line up, off by ~$200)
My 2025 CX-70 PHEV is due to go back soon so figured would look into some attractive MB deals floating around. The deal I ended up signing was a very attractive advertised out of state (MD) deal with a couple of other MD dealers coming relatively close.
The advertised deal was already aggressively priced at >21% off. The extra discount I was able to secure was due to the difference in the advertised mileage vs actual mileage (spoiler: actual mileage was materially higher) to offset the higher depreciation hit because of lower residual.
This is how the MBFS lease cash has functioned for as long as I can remember.
I called it out because it’s helpful for anyone hunting to know that the cash is a non-taxable reduction (in all States) to the selling price. It is not a potentially taxable (State dependent) CCR reduction.
Edit: This also means that dealers will almost always say their advertised discount includes the dealer cash. It also allows dealers to obscure the true discount to less knowledgeable buyers.
I think it’s a little more nuanced with Mercedes. They do have true dealer cash that does not show up on the contract at all which was the case with my 25 amg eqs from this June. Both of my previous eqs’s from 23 and 24 had 7500 lease cash which were a line item on the contract.
What’s interesting is that MBFS made a distinction back this spring/summer between dealer cash and lease cash and dealer cash was only offered on the AMG EQS but not on the regular EQS.
Also, the rebate was taxable on the one I signed in 23 but not on the one signed in 24. If I recall correctly that one was treated as non-taxable at dealer’s discretion as I had fleet and they just subbed fleet for a taxable incentive which was an option then. MBFS makes it too damn complicated!
I am waiting for the dealer to send me a copy of the executed contract but it is exactly as @douglashowitzer described: a non-taxable deduction to the selling price with N/A in CCR.
Are you in a State that doesn’t tax incentives? If so, I wonder if in those States dealers are less particular as it wouldn’t actually matter. If not, then I don’t understand why some dealers would handle it differently.
Every MB deal I’ve done in the last 3 years has worked as I described.
That all makes sense (mostly, still strange they handled tax differently on the 23 and 24) because the $7,500 rebate at the time of the 23 and 24 models was indeed a customer facing rebate. The 25 EQS contract was built with only MBFS dealer cash, not the federal rebate customer facing cash.
1 - Summer of 2024 was very confusing as different dealers were structuring deals both ways. If I recall correctly, my incentive was supposed to be taxable but they changed it to non-taxable on the spot when they realized that I had $500 Amex cert which they actually grabbed for themselves lol but I didn’t care as I needed to wrap that deal ASAP before an employee stole it from under me. See that thread for 2023 AMG EQS for details.
2 - Mercedes really complicated things this June (and possibly since April) when I got my 2025 AMG EQS when they had $25,500 dealer cash on the AMG only and $10,500 lease cash on non-amg models. My understanding is that the 10.5 would be customer facing and it would be listed as a line item on the contract in the manner you’re describing here.
That at least explains why they wouldn’t have been concerned with how it was applied. Zero tax implications in your case. Still a little confusing for sure.
Edit: Great point about the fleet. Unsure if once fleet is involved does the whole thing become customer facing and potentially taxable, or only the portion that is the added “fleet” bonus. Then again, Rok’s example doesn’t show that.
