How do I calculate sales tax for my vehicle purchase?

QandAs: Autos

Answer:
The amount you pay for sales tax depends on

many factors, including how much you paid for the vehicle, where you live, and how you purchased your vehicle.

To calculate the tax on your car, you will need to know the auto tax rate for your state. Then, calculate the amount of the overall cost that is taxable. Fees and warranties, for example, are not taxable. If you are purchasing from a dealer, be sure to ask which expenses are taxable. Apply the tax rate to the total amount of the taxable cost, and you will know how much you are going to pay for your vehicle’s taxes. Keep in mind that if you purchase your vehicle from an individual seller and pay far less than it is worth, the tax may be based on the retail price of similar vehicles, not the sale price.


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