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  • New Travel Trailer Tax/DMV Questions

    DH and I have a 2017 Airstream travel trailer that has warranty issues. It went back to Ohio and there is a possible offer for us to have a 2019 model built for us for a cost of $4000 in lieu of repairs on the other unit. This must mean that the cost of repairs is too costly. It was first said that the $4000 would be the total inclusive cost; however, now it is indicated that we would have to pay sales tax and DMV registration since that is beyond their control. Unfortunately for us, we live in the high tax state of California. Airstream says in Ohio we should pay tax only on the $4000. Fair enough of course...... but I do not think that is the case in California. We do not have written particulars at the moment, If this is calculated on the cost of the new unit before "trade-in" (I am assuming that is how it would be written up) we are looking at another $8500 or so. DH is not happy at this change of offer (both verbal) And the offer also includes that we travel to Ohio for inspection and pickup (they would pay for a hotel for a few days) which saves them $1000-$1200 in transport costs. I do not have a problem going to Ohio (not in the winter though) because we can look at the trailer and do a detailed punchlist (we both have engineering degrees). Anyone have any insight on whether we are stuck paying that extra $8500? They are willing to write a letter, but I am not sure to whom it would go........... BTW, it looks like the new trailer is identical to the one we already own - I do not see anything different. Thanks in advance!

  • #2
    Are you saying you'd owe $8,500 in taxes on a $4,000 purchase? How is that even possible?
    Steve

    * Despite the high cost of living, it remains very popular.
    * Why should I pay for my daughter's education when she already knows everything?
    * There are no shortcuts to anywhere worth going.

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    • #3
      No, that is not possible! My understanding with California is that when I submit paperwork, etc. I would have to put the purchase price of the trailer (assuming a retail price of about 100K) and pay sales tax on that amount. California does not care if the existing unit is considered a "Trade-in." If written up as 100k with 96K trade-in = $4000 final cost, we are still taxed on the $100K. If Airstream writes up the purchase agreement as $4000, then all is well, and taxes would be no more than $400. But I do not have details yet on a written offer. They indicate that they are not responsible for what California requires, and that in Ohio a buyer would not be paying anything but tax on $4000. I do not consider it fair to pay the large sale tax if due because these issues were not caused by anything we did. The MSRP difference between the 2 years is approx. 10K so if we have to pay $4K plus $8 K out of pocket then it is not as good as it sounded.

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      • #4
        That makes sense in a twisted sort of way. Such is life in California.

        I'm curious what is wrong with your current trailer that makes it better for the company to give you $96,000 in trade value rather than just fixing the problem. Surely it couldn't cost them anywhere near that much to make the repairs.
        Steve

        * Despite the high cost of living, it remains very popular.
        * Why should I pay for my daughter's education when she already knows everything?
        * There are no shortcuts to anywhere worth going.

        Comment


        • #5
          I read the initial post and was thinking--why don't I know the answer to that? So I had to do some digging.

          I'm presuming that the initial trailer is being declared a lemon and the new trailer is the replacement vehicle. According to the Lemon Law brochure from the Dept. of Consumer Affairs, the replacement vehicle is a negotiated item and can also include the reimbursement of Use Tax previously paid, registration fees, etc.

          So pull out your original papers and talk to the company again about whether you can get a reimbursement of the original Use Tax paid--they are probably not aware of what a burden it is in California.

          There is nothing within the California DMV that would allow the waiver of the Use Tax--they only collect on behalf of the tax agency. You can also try contacting the tax agency to see if this would qualify for a tax waiver--I've seen many tax waivers but don't know about the circumstances on how they were obtained. The Board of Equalization was split up and Use Tax now falls under the California Dept of Tax and Fee Administration. Their website is horrible, but there should be at least a phone number somewhere.

          Hope this helps.

          Edit: Finally found what I was looking for. If the manufacturer reimburses you for the previously paid Use Tax, they can request a refund from California. I'm linking below the page from the Dept of Tax that refers to that.

          https://www.cdtfa.ca.gov/lawguides/b.../490-0512.html
          Last edited by frugal saver; 10-25-2018, 07:47 PM.

          Comment


          • #6
            Disneysteve,

            Extensive issues with panels and roof. Unit would need to be taken apart and new roof and panels installed. Some issues were at manufacture and others caused by repairs done by the local dealer with authorized but lousy technicians. I am assuming that this is partly a good will offer.

            Frugal saver:

            Thank you so much for the feedback! I will look into this. The only offer we have at the moment is for $4000 for a new 2019 trailer - same model, same options that would be built for us. The cost is due to increase in pricing between the 2 year models. So this is kind of an exchange. But no specifics have yet been discussed -- I do not know how this will be written up. There has been no mention of making this unit a lemon -- so if it is not, I do not think the info above applies. They may choose to resell this unit. But I will call the California Tax and Fee Administration office to ask about a waiver. I also have to check into how the sales contract will be executed as far as taxes, title, and insurance. If I buy something out of state, I am assuming that they would process the paperwork for the State of California on our behalf or we could not take possession of the trailer. I may call a dealer in Ohio to ask that hypothetical question.

            Friends tell us to take this offer and run because DH would never be happy with the existing unit even if they fix it. A new unit would be in better shape..............

            Comment


            • #7
              Originally posted by SavingBucks View Post
              Disneysteve,
              Friends tell us to take this offer and run because DH would never be happy with the existing unit even if they fix it. A new unit would be in better shape..............
              A new unit will be in better shape? Didn't you buy a new unit and that is what is causing all of the issues now? Airstream is not doing right by you.

              Comment


              • #8
                Originally posted by corn18 View Post

                A new unit will be in better shape? Didn't you buy a new unit and that is what is causing all of the issues now? Airstream is not doing right by you.
                I don't know. I think their offer is fair. They got a lemon and the company is offering to give them $96,000 for it and replace it for $4,000. Presumably, the defects in the 2017 model have been corrected. I wouldn't have a problem with that deal.
                Steve

                * Despite the high cost of living, it remains very popular.
                * Why should I pay for my daughter's education when she already knows everything?
                * There are no shortcuts to anywhere worth going.

                Comment


                • #9
                  The unit was a 2017 that we bought in 2018 as new. It was on dealer's lot as a show model. The defects that we encountered should not be there on a new build. I think it hinges on being whole. Whole is a new 2017 which does not exist. So they are proposing to provide a 2019 and want the price difference since costs have increased. Our concern is how this is written up - it would be fair to owe taxes on the $4000 only. We will see. We are going there to pick it up -- good because we can look over it thoroughly, bad because we had not intended to go to Ohio (no offense to anyone from Ohio). There is no way we would go there in the winter. March or April should have better weather (I hope). Plus it takes awhile to build a unit. We did go to a local dealer today to look at the decor options and be nosy about pricing....

                  Comment


                  • #10
                    Originally posted by disneysteve View Post

                    I don't know. I think their offer is fair. They got a lemon and the company is offering to give them $96,000 for it and replace it for $4,000. Presumably, the defects in the 2017 model have been corrected. I wouldn't have a problem with that deal.
                    You're probably right. I hope SB can get the taxes sorted so they can have a new trailer and only pay tax on the $4000.

                    Comment

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