Poll- Declaring a vehicle for less then you sold it, Will my friend burn in hell? |
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Poll- Declaring a vehicle for less then you sold it, Will my friend burn in hell? |
highways |
Oct 6 2006, 11:01 PM
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#1
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Senior Member Group: Members Posts: 613 Joined: 18-June 05 From: Los Angeles, CA Member No.: 4,296 |
So this isn't for me, but a friend selling an expensive car, and finally they found a buyer. Thing is buyer is asking for some help by declaring the vehicle for about half of the sale price. Car is rather new and not cheap. Friend wants to help buyer (mostly just to get the damn thing sold, it's been forever) but also is scared of the legality of reporting low figures to DMV. I'm doubly worried for them because it's a fairly new car and the value would be pretty well established I'd think. What's the skinny?
Edit: Also this buyer is saying that some bonified dealers have been extending this 'arrangement' for him under the pretense that another car was traded, hence the low money value exchange. Could this be true? How's a private seller supposed to compete with dealers who pull this stuff? |
chilli |
Oct 6 2006, 11:26 PM
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#2
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Older Than Dirt :-) Group: Members Posts: 220 Joined: 24-March 05 From: Sacramento, CA Member No.: 3,805 |
So this isn't for me, but a friend selling an expensive car, and finally they found a buyer. Thing is buyer is asking for some help by declaring the vehicle for about half of the sale price. Car is rather new and not cheap. Friend wants to help buyer (mostly just to get the damn thing sold, it's been forever) but also is scared of the legality of reporting low figures to DMV. I'm doubly worried for them because it's a fairly new car and the value would be pretty well established I'd think. What's the skinny? Edit: Also this buyer is saying that some bonified dealers have been extending this 'arrangement' for him under the pretense that another car was traded, hence the low money value exchange. Could this be true? How's a private seller supposed to compete with dealers who pull this stuff? DMV, in Calif, only collects the money. The Board of Equalization (IMG:style_emoticons/default/sad.gif) (IMG:style_emoticons/default/sad.gif) is the one that will "audit" this. The BOE is resonsible for sales tax in Calif. and the they do good job of it. Collecting that is. They will audit anything that does not look reasonable. Then you and the buyer will be facing fraud. Want to play the odds. to save a few bucks. mike (IMG:style_emoticons/default/driving.gif) (IMG:style_emoticons/default/driving.gif) (IMG:style_emoticons/default/sad.gif) |
736conver |
Oct 6 2006, 11:36 PM
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#3
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Advanced Member Group: Members Posts: 2,117 Joined: 25-May 03 From: SE Wisconsin Member No.: 736 Region Association: None |
Yea not something for your friend to mess around with. Up here in WI I bought a car for $300. DMV or who ever is in charge sent the original owner a letter wanting to know the sale price of the car.
They check up on this kind of stuff. I am sure the fines are hefty |
Gary# |
Oct 6 2006, 11:47 PM
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#4
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Member Group: Members Posts: 217 Joined: 15-May 05 From: Buena Park, Ca. Member No.: 4,078 |
Also, I believe in Ca - if it's a gift or a transfer between family members... (IMG:style_emoticons/default/KMA.gif)
All of the rules change in your favor (IMG:style_emoticons/default/bootyshake.gif) |
Midtowner |
Oct 7 2006, 12:22 AM
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#5
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Ooooo! Group: Members Posts: 652 Joined: 21-December 04 From: Sunnyvale, CA Member No.: 3,316 Region Association: None |
I hear that the California DMV pays particular attention to market value vs. selling price for lease vehicles bought and sold for the first five years. This makes up the largest category every year. Sales beyond five years are considered not as important and receive less scrutiny. Still though, don't make it sound ridiculously cheap because it will just attract unwanted attention. This comes from a close friend of mine who holds a dealer license in CA. Not sure about other states. (IMG:style_emoticons/default/smile.gif)
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Lou W |
Oct 7 2006, 12:35 AM
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#6
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"Here Kitty Kitty" my ass...... Group: Members Posts: 4,109 Joined: 9-May 04 From: Roseburg, OR. Member No.: 2,039 Region Association: Spain |
I've done this before with a brother-in-law, he reported it as sold for less than the actual sale, he drew up a sales contract that stated the vehicle was being sold "as-is" which we thought would help if there was any question to its sale price compared to actual value....later, I did receive a letter from the State of California asking me what was the amount that I had sold it to him, fortunatly, I remembered the amount that was reported.
So, I guess they can and sometimes do audit these things. I think you do have to be careful, and stay away from really low balling the sales amount. |
gopack |
Oct 7 2006, 04:30 AM
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#7
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CHEESEHEAD in CA, MARK Group: Members Posts: 744 Joined: 7-August 04 From: Folsom, CA Member No.: 2,472 Region Association: Northern California |
here is an easy way to sell the car and NOT have any potential problems since it is an expensive car:
Take the actual sales price, and subtract the amount of half of the sales tax that would have to be paid, this gets the car sold to a serious buyer, and costs ONLY a couple of hundred dollars and everyone is happy, including Ahr-nold and his goonies. I once read that most car sales that fall through are disputes over 2 or 3 hundred dollars, but if you think of the percentages, it is not worth the fight. |
GWN7 |
Oct 7 2006, 04:46 AM
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#8
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King of Road Trips Group: Members Posts: 6,280 Joined: 31-December 02 From: Winnipeg, MB, Canada Member No.: 56 Region Association: Northstar Region |
most car values have a poor, medium and high value.
You could get away with selling at the poor book value. Anything under that and it will raise ?'s. Make sure you get payed in cash (not another cheque, cash) on anything over the value on the bill of sale. |
DNHunt |
Oct 7 2006, 07:09 AM
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#9
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914 Wizard? No way. I got too much to learn. Group: Members Posts: 4,099 Joined: 21-April 03 From: Gig Harbor, WA Member No.: 598 |
I hate to say it but, there is a thing called integrety here also. What is your friend's good name worth. There are other buyers out there. I know it's old fashioned. Time for your friend to take a good long look at what he's made of. The answer is inside him and not on a forum on the internet.
Dave |
SLITS |
Oct 7 2006, 07:50 AM
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#10
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"This Utah shit is HARSH!" Group: Benefactors Posts: 13,602 Joined: 22-February 04 From: SoCal Mountains ... Member No.: 1,696 Region Association: None |
AFAIR, the "Use Tax" didn't come in till after Prop 13 cut their revenue for "fact finding" trips to the Bahamas. Fuck 'Em .... I'll take money away from them anyway that I can. You have to be suspicious of someone that will spend $2 Mil to get a job worth $50 K per year.
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Brian Mifsud |
Oct 7 2006, 08:03 AM
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#11
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Mechanical Engineer Group: Members Posts: 981 Joined: 3-March 03 From: Penngrove, CA Member No.: 384 Region Association: None |
In spite of what most think, any branch of state of local govt (at least in California) involved in collecting taxes/ registrations/ etc, have become VERY efficient!
San Mateo County runs three yacht harbors. You pay a monthly rent of course for the convenience of a place to tie up the boat (electrical and water are extra). San Mateo County also charges "property tax" on the boat, because it is "occupying space in the county". They asked me what I thought it was worth, then did their own "research" and came up with a valuation about 30% higher than mine. I get taxed on this valuation, but they DO depreciate it each year, so my tax is reduced. I thought about fighting the elevated valuation they put on it, but I would be bickering over 1% of the 30% difference which I'm sure they intended, wouldn't be worth haggling with county employees. There are SOME shrewd state/county employees out there setting policy although you wouldn't think so.... |
Joe Bob |
Oct 7 2006, 08:25 AM
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#12
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Retired admin, banned a few times Group: Members Posts: 17,427 Joined: 24-December 02 From: Boulder CO Member No.: 5 Region Association: None |
Sales tax is the biggest rip off.....you should only pay tax on a car when it's new.....
If the state wants to tax used sales....it's should be a lower rated "use" or transfer tax....less people would cheat if it was that way. |
blitZ |
Oct 7 2006, 08:28 AM
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#13
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Beer please... Group: Members Posts: 2,223 Joined: 31-August 05 From: Lawrenceville, GA Member No.: 4,719 Region Association: South East States |
It's lame enough already sales tax is being collected on an item more than once. Once, when it was sold new and each time it is sold used.
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IronHillRestorations |
Oct 7 2006, 08:34 AM
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#14
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I. I. R. C. Group: Members Posts: 6,719 Joined: 18-March 03 From: West TN Member No.: 439 Region Association: None |
The other issue is the odd chance there would be a total loss of the vehicle. The insurance company could go back to the sales tax records and pay you for what you claim to have paid.
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JPB |
Oct 7 2006, 08:35 AM
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#15
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The Crimson Rocket smiles in your general direction. Group: Members Posts: 2,927 Joined: 12-November 05 From: Tapmahamock, Va. Member No.: 5,107 |
For private transactions, what they pay and what you have paper billed them for can be what ever if all is done in cash. They then have to prove the transaction if they decide to look into the matter. From my experience, when you go to the DMV, the vehicle will have a minimum value they must charge you for taxes. If your bill of sale shows a 20K car sold to you for 5K because the dude was a crack head heading into a divorce, then it his loss and your gain. Since the time of Christ, tax people were look down on and they had nothing on todays high tech tax thieves.
(IMG:style_emoticons/default/beer.gif) From my experience, tax people are freekin nuts and will never change. I Voted the DMV is the man because without them, you could not drive legally unless your from south of the border and you go to court and get slapped on the wrist for not having a drivers permit or insurance. Hey, I know someone who has gone 9X and is still driving today and he also has fled the scene at least 4X and thats just one dude! |
boxstr |
Oct 7 2006, 09:11 AM
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#16
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MEMBER:PACIFIC NORTHWEST REGION Group: Members Posts: 7,522 Joined: 25-December 02 From: OREGON Member No.: 12 Region Association: Pacific Northwest |
Your friend is helping the buyer already, probably by lower his asking price to sell the car. Why should he legally sticking his neck out to put himself in a position of vulnerabilty. I vote no.
Tell the buyer he can manipulate the documents all he wants, after the sale is finalized.' CCL |
BMartin914 |
Oct 7 2006, 12:33 PM
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#17
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||| Group: Members Posts: 1,408 Joined: 30-May 04 From: Oregon Member No.: 2,128 Region Association: Pacific Northwest |
It's lame enough already sales tax is being collected on an item more than once. Once, when it was sold new and each time it is sold used. You bet , and they want every dime they can get too. It would be one thing if you bought a car for $500 and reported the sale price as $200 - $300, but an "expensive" car, near to new? Probably not too likely to get away with it unnoticed by someone in the chain. If I were the seller, I would be asking myself, why would someone who wants to buy a near-to-new, "expensive" car need a break on the taxes? He's going to be shelling out for insurance, etc. anyway. I guess some people are known to be...cheap. |
Cap'n Krusty |
Oct 7 2006, 01:02 PM
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#18
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Cap'n Krusty Group: Members Posts: 10,794 Joined: 24-June 04 From: Santa Maria, CA Member No.: 2,246 Region Association: Central California |
Somebody's blowing smoke on the dealer thing. Any legitimate dealer MUST report the total value of the sale, not just the cash. The total value is the agreed value of the trade in plus the sum of the cash or other negotiable instruments. Any dealer understating the value on a consistent basis is gonna get caught and lose his livelihood. Not something most of them take lightly. "Sure, we'll fool the DMV for a few hundred bucks, and I'll give up my license, pay heavy taxes, fines, and penalties, have a criminal record, and look for a job in another field." Hmmmmmm ...... Seems like a good deal to me .............. The Cap'n
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turboman808 |
Oct 7 2006, 02:45 PM
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#19
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Advanced Member Group: Members Posts: 2,718 Joined: 31-January 06 From: North Jersey Member No.: 5,505 Region Association: North East States |
I've done it before but on a expensive car I would be nervous.
10 grand in taxes sucks alot. Thats like 4 sets of kinesis wheels and tires (IMG:style_emoticons/default/sad.gif) |
thomasotten |
Oct 7 2006, 04:35 PM
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#20
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Senior Member Group: Members Posts: 1,545 Joined: 16-November 03 From: San Antonio, Texas Member No.: 1,349 |
They just passed a law here in Texas that you have to pay taxes on 80% or the retail value of the car. You can contest it, but then you have to hire an appraiser for $300. I tell you, this is turning into a socialist county. This is when the government has overstepped its bounds. The governement has no business in this matter, from a natual law point of view.
I bought my wife's 99 Audi for 1/3 of the retail value because it had a broken timing belt. If there is a signed receipt from the seller to the new owner, that should be enough to determine the tax value, because a car is ultuimatley only worth what someone is willing to pay for it. |
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