Buying a car in PA
Can anyone confirm or deny that if you live in NJ but buy a car in PA, you can avoid paying PA sales tax if you have the dealer drive the car to NJ and take possession of it there? Or is that an urban legend?
I thought you always pay sales tax in your home state when you go to title/register it... unless PA and NJ have some sort of reciprocal agreement where you pay the NJ taxes at the dealer and they handle the paperwork to make sure it goes to the right state.
You should never have to pay *both*. At most you’d get another bill for the difference if your home state has a higher tax rate than the state where you bought it.
I never did a cross border sale when I lived up there, but I just bought a motorcycle in Tennessee and only paid a few bucks in tax on the doc/prep fees, etc. My home DMV nailed me for the rest on the actual value of the vehicle...
I will add, there may be a little “double dipping” if there is a *local* tax applied where you purchase the vehicle. I doubt you can get around that by taking possession of it elsewhere as the dealer would always just say “pick it up one town over” and the law would be quick to catch on to that...
Years ago, I bought a Jetski from a PA dealer and payed no sales tax at the time of purchase but when it came time to register it in NJ I needed to show proof of sales tax! I think that is what you will find with a car also!!.
I must add that the dealer wrote the paperwork up as an out of state delivery!
Just remember if you buy a brand new car in PA you still have to get it inspected in NJ. Found that out the hard way. 2 weeks of owning a brand new car with PA inspection sticker a Mt Olive cop gave me a ticket for not having NJ inspection sticker.
You pay tax to the state you reside and register the vehicle to. That said not every dealer has out of state tax rules setup properly on the dms to accommodate and calc those taxes correct but that is how it works.
I would think there are no "free rides". ha-ha.
I bought a car from the Ray Price automall last fall. Great experience. They took care of the NJDMV docs -- plates were FedEx'd to me. I did not pay for any PA fees/taxes - only NJ? BTW -- their "documentation processing" fee was only $95 --- a fraction of what I have paid NJ dealers in the past. Good luck.
Maybe hes avoiding the taxes on his end hence allowing for a cheaper price to you. But you'll def have to pay NJ taxes when you go to register it. Depending on the price that's written on back of title of course.
"I bought a car from the Ray Price automall last fall. Great experience. They took care of the NJDMV docs -- plates were FedEx'd to me. I did not pay for any PA fees/taxes - only NJ? BTW -- their "documentation processing" fee was only $95 --- a fraction of what I have paid NJ dealers in the past".
Once you get your plates you can go to any NJ inspection station and get the inspection sticker, No inspection or fee.
Don’t know why folks just don’t look it up on MVC’s Website or give them a call.
Sounds like this falls under “transfer a vehicle into New Jersey”.
I worked for DMV years ago and also worked for a dealership as a title clerk.
If you purchase a car out of state and the dealership is not authorized to collect sales tax, then you have to pay the tax in NJ.
I have never heard of a dealership driving the car over state lines so you don't have to pay tax.
Usually a new car dealership will do all the taxes and doc fees.
The question is really for the seller in that since you will register the car in NJ, somehow you will pay NJ sales/title tax, based on value, at that time. The only question is the process. The dealer should not charge you PA title tax nor double-dip you on any taxes in this regard, NJ or PA, without you knowing who's paying whom.
Short strokes: "when purchasing a new vehicle from an out of state dealer, verify the New Jersey titling process with the dealership." They may or may not handle this for you, even though they are not in NJ. NJ dealers do it automatically of course. And be sure you're not getting double-whacked for the same thing in PA and NJ. Again, a dealer question.
Here's your bible: https://www.state.nj.us/mvc/vehicles/titlenew.htm
And it's relatively short and ez to understand!
It is an urban legend. You need to register in NJ and NJ needs to see the taxes paid or no registration and no window sticker. This being said, you can save on the dealer fees in PA which are generally lower than NJ, and they are often more eager to negotiate lower if you come from NJ to get your business.
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