I currently leasing a 2021 VW Tiguan, and have a question about trade in. When my lease is about to end, am I allow to trade my car in to different brand other than VW? For example, Clay Cooley, the auto group operates 10 different car brand dealerships including VW here in DFW. Let say if I were to go to Kia dealership own by Clay Cooley to purchase Telluride, I can trade in my VW to get tax benefits toward New Telluride?
As long as the dealer operates a VW brand they should be able to do this. You can’t really “trade” in a lease. There would be a buyout involved. You want to get an equity check, if there is one, and keep the two transactions separate, new car and old car.
I don’t think there would be any sales tax benefits to you in TX by “trading” the leased VW in at Kia and leasing a Kia. You don’t own the VW; therefore, you don’t receive the tax benefit as you would if you were trading in a traditionally financed vehicle. The only way you get a tax benefit in TX would be if you “trade” your leased vehicle for another vehicle of the same make. i.e. BMW lease for another BMW lease. BMW financial owns both vehicles, therefore they receive the tax benefit of the trade and pass that to you.
This make sense. Thanks!
Thank you! I really should’ve asked if I’m allowed to sell my leased vehicle to Kia dealer when both VW and KIA are operated by same auto group.
I wasn’t really talking about if it’s allowed or not. You brought up sales tax savings by “trading in” the VW for the new Kia lease. My understanding is that in TX there is only a sales tax savings by “trading in” one leased vehicle for another leased vehicle, only if the lender is the same. ie you would have to “trade in” the VW lease for another VW lease. VW Financial owns both cars, therefore they get the sales tax break and pass it onto you. You do not own the current VW; therefore, you cannot reap any sales tax benefit.
Now on the other hand, there could be sales tax credits on the Kia. Which would be more advantageous than saving sales tax by “trading in.”
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