Sales tax isn’t calculated twice. One is sales tax on the cap cost reduction. The other is sales tax on the actual payment amount.
There is only one gross cap cost shown. The $47450 is the sales price before anything has been capitalized. There is another section in the lease contract that you arent showing here that itemizes the gross cap cost.
I am looking at someone’s deal and was trying to understand how the taxes were calculated. I cannot see the full 5 pages of the contract but the county mentioned is not in New Jersey (I think its in New York).
Also, I checked, on page 2 the contract says $336 for title and registration (therefore 336 + 47,450 = 47,786). The same field in section 6 was “N/A” so I could not figure it out.
Nevertheless, could you share how do you calculate the sales and use tax?
NJ has 6.625%, but until June 30 I believe it is 3.3125% on EVs.
Thanks
Geez Louise! Why would they capitalize a non-taxable title/reg. fee of 336 for a single pay lease? That’s beyond stupid.
Sounds to me you’re not sure whether this vehicle will be garaged in NY or NJ.
You don’t seem certain about the sales tax rate yet; the contract implies a sales/use tax rate of 8.76%.
What is the term of the lease?
Hard to do a thorough analysis. Too much uncertainty.
11500.13… 8.76% x 11500.13 = 1007.41
It’s not calculated twice. …
8.76% x (3142.80 + 595 + 999) = 414.94
In the first calculation, tax is levied on the cap reduction. In the second calculation, tax is levied on the sum of the single payment, acquisition fee, and doc fee.
They are not two gross caps. The 47450 is the agreed upon value (selling price). The 47786 is the gross cap.
Hello!
Thank you so much for the detailed answers. This was very helpful. The contract was for 24 months. Since, it does not belong to me, I was unsure if posting it here with entirety would be the right thing to do!
I’m glad I could help. The money factor is .00040 which equates to an interest rate of about .96% which is very good. Not exactly sure what the dealer discount was as I don’t know the MSRP. So, I don’t know whether this deal is good or bad.
If that’s your question then why didn’t you ask that?
Why are you posting someone else’s indecipherable contract? With no guarantee that it was done correctly or that the line items actually match the numbers? Because I can guarantee you that no state in the union has a tax rate of 8.75999%.
In NJ you’ll tax sales tax on the total payments as well as the rebates. Luxurytax of 0.4% of the selling price also applies if applicable
All the calculations are accurate. I’m guessing the 8.76% rate is some jurisdiction in NY state. Why do you think the contract is indecipherable? I had no problem with it once OP provided the term. Also, 8.75999…% = 8.76%. (rounding)
Of course there isn’t. The rate used in the contract is 8.76% For instance, from the contract, we have…
8.76% x (3142.80 + 595 + 999) = 414.9436800… rounded to 414.94
and
8.76% x 11500.13 = 1007.411388… rounded to 1007.41
To find the tax rate, it appears that you did this…
1007.41/11500.13 = .087599879… and then, took this as gospel.
Do you honestly think you’re going to get. .08760000000000000 EXACTLY??? When calculating tax rates in lease contracts, only very rarely do you get the exact tax rate.
Yes, and it’s a very reasonable assumption to the extent that it is exactly what they did. Payments, taxes, etc. in lease contracts are often rounded which is why calculations with rounded numbers will likely result in approximations.
the posts are being flagged (no I am not flagging them) because they’re actively targeting specific users with antagonistic language because you disagree with them.
max’s posts aren’t for everyone. you don’t have to agree with their terse replies or strong opinion. that doesn’t mean they are breaking the rules. you can disagree with someone without being passive aggressive.
I would suggest you use the ignore feature on this forum to hide their posts. you’ll sleep a lot better at night
The MSRP of the vehicle is $68,500 (I got this from Acura website https://www.acura.com/suvs/zdx/pricing-and-specs). So, there is one more thing I am curious about, which is that how did the seller list the selling price of the car as $47,450 and not $68,500?
