Used Auto Taxes in Texas

admin — Tue, 24 Nov 2009 05:20:05 +0000

I’m sure some of you have been a little surprised (or angry) when you got to the tax office all ready to transfer the title of your newly acquired vehicle (which you got a good deal on) and the tax office tells you that you have to pay taxes on a higher amount than what you gave for the vehicle. I’ll tell you why this happened and how to get around it which the tax office won’t normally tell you. What the State of Texas has done is write a law that says they can tell you what the value of your car is, no matter what you paid. On top of that, the law also says that if you paid more, then you have to pay taxes on the higher amount! To me, that is a little bit crazy. They have set a minimum on the value of vehicles using what they call the Standard Presumptive Value (SPV). There are a few exceptions, but they don’t really help the bulk of private auto purchasers. Here are the nine exceptions:

1. Clearly, a new vehicle is not a used auto, so the law doesn’t apply to a new car.
2. Also, if you purchased a used car from a licensed dealer, then their price sticks, so you pay taxes on the actual purchase price in this instance.
3. If you buy a used vehicle from a government or “repo” auction, then they cut you a break and you only pay taxes on the actual purchase price.
4. If the vehicle is not actually an auto, like an all terrain vehicle or a dirt bike, then the law doesn’t apply.
5. If you buy the vehicle at a salvage auction and it is actually a salvage vehicle (with damage intact), then you get a break and just pay taxes on the purchase price.
6. Gift vehicles can slip through the cracks in some cases.
7. If you swap two vehicle even, then the SPV doesn’t apply.
8. If the vehicle you purchased is an antique, or more specifically, if it is 25 year old or older, then no SPV is required to be calculated.
9. A mechanic or storage lot can sell you a vehicle if they acquired it by way of lien and you only have to pay taxes on the amount paid.

So, if you find a vehicle in the classifieds and you want to buy it from the owner (who isn’t a dealer, salvage lot, mechanic, or lienholder/government official) it could cost you more than you think when you get to the tax office. If you want to know for sure what it will cost you, then you have to know what the Standard Presumptive Value is. Here’s how you do it:

1. You will need to get the VIN and mileage off of the subject vehicle. (call the owner and get it)
2. Now, you need to go to the Texas Department of Transportation website and search for “Standard Presumptive Value Calculation”.
3. Now enter the vehicle identification number and the mileage in the appropriate boxes and have it calculate the value.
4. You need to figure 80% of the value it tells you and use that value for #5 below.
5. Take the value and multiply it by the appropriate sales tax rate in Texas (6.25% as of the writing of this article).

Now you should have a figure, and this figure is the approximate amount you will be asked to pay, unless you say you paid more than what the SPV calculator said the vehicle was worth, and in that case, you will be asked to pay taxes on the higher purchase price, but what if the vehicle you purchased was not in the best of shape and you didn’t pay as much as the tax office says you should have? What can you do about it? The answer is in form 14-128 from the Texas Comptroller of Public Accounts office. This form is used by insurance adjusters and dealerships to certify the value of a vehicle specifically for tax purposes. If the vehicle you purchased has body damage, unusually worn seats, bad paint, or any number of other issues that can affect its value, then this is the route to go. For example, if you purchase a 2000 Ford F-250 as a work truck and you find someone that has a beat up one with 250,000 miles on it, then the likely tax value will be around $4360.00 (80% of the SPV as calculated on the TXDOT site), but because it had been used as a work truck, it is beat up, dirty inside and has some mechanical or maintenance issues so you were able to get the owner to sell it to you for $1500.00.

The tax office will make you pay around $272.00 for taxes, but if you go and get a certified appraisal from and adjuster or dealer (you can get one from an adjuster for around $75.00 or less depending on the adjuster and vehicle, but a dealer has to charge at least $100.00 unless it’s a motorcycle, then it’s at least $40), then the value could come out to around your $1500.00 purchase price (or less), so with the appraisal you will only have to pay about $93.00 in taxes. So if you add in the cost of a $75 appraisal, you still will have saved over $100.00 on your taxes based on the above scenario. I think that savings is worth it, especially since most of the time, if you paid less than the SPV, then there’s a reason and the appraisal will be much lower than what you actually paid and it could potentially save you much more on taxes than the example I have given. Individuals and businesses can take advantage of form 14-128. Two special points to make sure you are aware of:

1. If you get need a certified appraisal, it has to be completed within 20 days of the sale.
2. You can get a refund if you didn’t read this article before you paid the tax office, but you are still bound by the 20 day rule.

That’s it! I hope this saves you some tax money someday!

By: Justin Petty

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Used Auto Parts

admin — Wed, 11 Nov 2009 03:10:19 +0000

Used auto parts not only include car parts but also trucks and other vehicles. There are many websites that sell and buy used auto parts. These business firms salvage what they can from junkyards and improve on the quality of that part before selling it. If a person is interested in selling used auto parts then it is advisable to start the business on-line so that the seed money required for the business is less compared to any business that is initiated in the normal market.

The United States of America produces so many cars in a year that it is difficult to recycle every part that is produced and the junkyards have started to pile up. The used car parts market is very big in the US and is cluttered with useless parts that people try to sell. Recognizing and differentiating between useful parts and the useless ones is a skill that is required in this business.

Numerous salvage yards buy used automotive parts and usually purchase the sheet metal of the body and late model trucks or cars with usable parts. This means that almost all salvage yards owners are interested in buying automotive parts that are in working condition.

Used auto parts come in many varieties and the quality of a used auto part can be judged according to its age, the make, whether it was still in use, and according to the wear and tear that it has withstood. Many gas stations sell used auto parts but the quality of these parts may not be very good. If a person is interested in buying and selling used auto parts then a salvage yard can provide the seller or the buyer with myriad choices.

There are retail outlets, online stores, mechanics and salvage yard owners who readily agree to buy or sell used automotive parts to anyone who is interested. A simple garage sale can also be a solution for selling or buying used auto parts.

By: Thomas Morva

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