Is a cross country road trip to pick up a Tesla a good idea?

[lucy]

I live in the EV desert of Iowa, and once the MX is finally out, don't really want to wait the extra month or more it will take to get my car shipped here, or to St. Louis or Minneapolis. My reservation # won't be until next year, but I have a question...

Is it a good idea to fly to the home office and accept delivery from the mother ship, then drive home?

Other possible benefits: could get a wrap/tinting done out there in the land of many cars, vs in Des Moines where the choices I'm seeing on the net are not many (like 1 car dealership for wraps, otherwise it's ad agencies)

Thanks in advance for your help!

:smile:

 

[pvogel]

I did that (admittedly only 450 miles or so) to pick up a Prius v back in 2011. I was happy with the decision.

 

[pvogel]

It does add miles to the car right up-front that instantly drops the value of the car, but if you are planning to keep it for a while, what do you care?

 

[lucy]

It does add miles to the car right up-front that instantly drops the value of the car, but if you are planning to keep it for a while, what do you care?

I don't put on many miles generally, so not too concerned about that...

 

[CmdrThor]

Unless money is no object, one concern is that you will pay sales tax in both California and possibly in Iowa when you register the car (depending on the law in Iowa). There is no getting around the California sales tax law. I believe some people have taken delivery at a store in a nearby state such as Arizona which did not have such an unfavorable sales tax law regarding picking a vehicle up and immediately driving it out of state.

 

[stevezzzz]

Don't you have to pay CA sales tax if you pick it up in CA? That could be an issue.

 

[pvogel]

Good point. Nevada is a good choice in that case

 

[lucy]

ouch, that would be a double bite. I'll have to look into that.
Thanks!

Luckily I have plenty of time. :-(

 

[goneskiian]

I think I read about someone picking one up in Portland Oregon to avoid the Cali tax issue as well. No sales tax in Oregon either.

 

[O-G]

All of the states have ways to handle this and avoid both double taxation or avoiding taxation. I would expect that if you picked up the car in California, TM would license it in Iowa. They would collect and pay to Iowa any tax due there. They would not collect any California tax since it is not being licensed in California.

By by the same token you cannot buy a car in Oregon with no sales tax and then license it in another state. As soon as you try to license it, you will pay a "use" tax which is the same as what the sales tax would have been. You can drive around with out of state plates but when you are stopped and asked to prove residency in Oregon, you will pay a hefty fine. This is way too big a tax issue for all of the states. The loopholes have been closed long ago.

 

[mspohr]

If you pick up the car in CA you will pay CA sales tax. You may or may not get a credit for this in Iowa. Check with IA DMV on this. You could end up paying sales tax twice.

 

[goneskiian]

All of the states have ways to handle this and avoid both double taxation or avoiding taxation. I would expect that if you picked up the car in California, TM would license it in Iowa. They would collect and pay to Iowa any tax due there. They would not collect any California tax since it is not being licensed in California.

By by the same token you cannot buy a car in Oregon with no sales tax and then license it in another state. As soon as you try to license it, you will pay a "use" tax which is the same as what the sales tax would have been. You can drive around with out of state plates but when you are stopped and asked to prove residency in Oregon, you will pay a hefty fine. This is way too big a tax issue for all of the states. The loopholes have been closed long ago.

This has been discussed ad naseum here and there is no way to do this and avoid paying California sales tax. Sorry.

Sales Taxes - pay in two states!!

 

[lucy]

This has been discussed ad naseum here and there is no way to do this and avoid paying California sales tax. Sorry.

Sales Taxes - pay in two states!!

This is why I am axing. Thanks for the link!

I bought my last car in Minnesota & it was no big deal, the dealership sent the info to the Iowa DOT & I paid the Iowa tax & registration when I got home.

Nothing much else to think about while we wait for the Design Studio to open, even for the signature reservation Holders! I'll just be designing my MX in every possible combination while the 15000+ ahead of me go 1st. *sigh*

 

[adiggs]

All of the states have ways to handle this and avoid both double taxation or avoiding taxation. I would expect that if you picked up the car in California, TM would license it in Iowa. They would collect and pay to Iowa any tax due there. They would not collect any California tax since it is not being licensed in California.

By by the same token you cannot buy a car in Oregon with no sales tax and then license it in another state. As soon as you try to license it, you will pay a "use" tax which is the same as what the sales tax would have been. You can drive around with out of state plates but when you are stopped and asked to prove residency in Oregon, you will pay a hefty fine. This is way too big a tax issue for all of the states. The loopholes have been closed long ago.

A very reasonable opinion and way of doing things O-G. And also not the way California works. Unless you can take delivery and depart the state without taking advantage of any services of the state (charging station, restroom, ...) and prove it (very unlikely they will believe you aren't going to stop for dinner), they will be collecting California sales tax. Bums me out they do things that way - I'd love to take delivery in Fremont and drive home to Oregon, but alas.

I've even written to the Board that manages the Use Tax, and pointed out that they COULD be building up a new angle on the state tourism business. Think of how many US market owners would bring the family to California for the factory tour, pickup their car, and then drive it home; probably with a stop by Disneyland, Hollywood, drive up the coast, etc.. etc.. And think of how desirable Tesla owners are to have come do touristy things in your state.

Then Tesla would need to get to work, or outsource to a third party, the building of a package for overseas buyers. Come to California, pickup your new Tesla, drive it around for a month or 2 on your summer vacation; then drop it off on the East or West coast to be shipped back to your home and delivered to you there. BMW has that going, and I've read some awfully good stories from people who think that Germany is the only place to pickup a new one.

They could even avoid making major alterations to the state law - add in a 30 day registration that manufacturers of cars manufactured in California can issue as part of delivering a car (no dealers, only manufacturers), that can't be extended, and can only be issued to people that can in some way demonstrate that ultimate registration of the vehicle is somewhere other than California. Charge $100 for it - get some direct revenue for the state, get some more sales tax revenue from people vacationing at least partially in the state, and it'll all be revenue the state of California won't otherwise get. Sure seems like a good idea to me.


Any Use Tax Board folks reading this, feel free to claim the ideas in this post as your own, and just do it! Preferably in the next month or two so I can drive my Model X back from Fremont!

 

[lucy]

A very reasonable opinion and way of doing things O-G. And also not the way California works. Unless you can take delivery and depart the state without taking advantage of any services of the state (charging station, restroom, ...) and prove it (very unlikely they will believe you aren't going to stop for dinner), they will be collecting California sales tax. Bums me out they do things that way - I'd love to take delivery in Fremont and drive home to Oregon, but alas.

I've even written to the Board that manages the Use Tax, and pointed out that they COULD be building up a new angle on the state tourism business. Think of how many US market owners would bring the family to California for the factory tour, pickup their car, and then drive it home; probably with a stop by Disneyland, Hollywood, drive up the coast, etc.. etc.. And think of how desirable Tesla owners are to have come do touristy things in your state.

Then Tesla would need to get to work, or outsource to a third party, the building of a package for overseas buyers. Come to California, pickup your new Tesla, drive it around for a month or 2 on your summer vacation; then drop it off on the East or West coast to be shipped back to your home and delivered to you there. BMW has that going, and I've read some awfully good stories from people who think that Germany is the only place to pickup a new one.

They could even avoid making major alterations to the state law - add in a 30 day registration that manufacturers of cars manufactured in California can issue as part of delivering a car (no dealers, only manufacturers), that can't be extended, and can only be issued to people that can in some way demonstrate that ultimate registration of the vehicle is somewhere other than California. Charge $100 for it - get some direct revenue for the state, get some more sales tax revenue from people vacationing at least partially in the state, and it'll all be revenue the state of California won't otherwise get. Sure seems like a good idea to me.


Any Use Tax Board folks reading this, feel free to claim the ideas in this post as your own, and just do it! Preferably in the next month or two so I can drive my Model X back from Fremont!

Great ideas.
I would have totally made a California vacation out of the trip, plus purchased my aftermarket car stuff there too, if the tax within reason. Not willing to pay thousands though, then pay thousands more at home. Darn you, Obamacare! ;-)

 

[OlderThanDirt]

There are very good options for coating and wrap within a few miles of Tesla's Eden Prairie Store in the Twin Cities. We have been checking them out as we will take delivery of our Model S there. From experience I would not chance the drive home before getting the wrap and coating completed.

We are of in the same situation being in a Fat Earth state if you catch my drift :wink:.

 

[OlderThanDirt]

There are very good options for coating and wrap within a few miles of Tesla's Eden Prairie Store in the Twin Cities. We have been checking them out as we will take delivery of our Model S there. From experience I would not chance the drive home before getting the wrap and coating completed.

We are of in the same situation being in a Fat Earth state if you catch my drift :wink:.

That would be Flat Earther State

 

[tga]

Any Use Tax Board folks reading this, feel free to claim the ideas in this post as your own, and just do it! Preferably in the next month or two so I can drive my Model X back from Fremont!

Rather than give up any sales tax from non-resident purchasers, they could do what FL does - charge the max of the purchasers home state tax rate, and FL's 6%.

The idea is that the sales tax is reduced to what you would pay to your home state, and (most) states give you a credit on taxes already paid, so you wind up paying no more tax to buy the car in FL than in your home state:

FL Dept Rev - 2014 Tax Information Publication 14A01-01

 

[lucy]

There are very good options for coating and wrap within a few miles of Tesla's Eden Prairie Store in the Twin Cities. We have been checking them out as we will take delivery of our Model S there. From experience I would not chance the drive home before getting the wrap and coating completed.

We are of in the same situation being in a Fat Earth state if you catch my drift :wink:.

Thanks, OTD! I bought my current ride (used Audi) in Minnetonka, so know it's cool to buy & transfer the paperwork from MN.

I'll start researching the shops, Plus a 5 hour trip in an unfamiliar car (last time was in a snow storm) is less scary than a multi day trip.

 

[BoerumHill]

Rather than give up any sales tax from non-resident purchasers, they could do what FL does - charge the max of the purchasers home state tax rate, and FL's 6%.

The idea is that the sales tax is reduced to what you would pay to your home state, and (most) states give you a credit on taxes already paid, so you wind up paying no more tax to buy the car in FL than in your home state:

FL Dept Rev - 2014 Tax Information Publication 14A01-01

Actually, that's not how that works, pard. If you pick up in Fremont you're paying 9.5%. Go back and read the page you linked.

FL will give you credit for sales tax paid in other states, but they have no ability to impose a cap for whatever percentage their residents in another state.

Now nobody is going to get taxed twice, regardless of where you live and/or where you take delivery. Generally, most states allow a credit for Sales Tax paid in other states up to (but not exceeding) your home state rate.

For example, if you were in a 7% state and bought a vehicle in a 6% state, most states would credit you the 6% and only the 1% would be due your home state.

But if you're living in a 6% state and take delivery in a state with a higher rate, you'll pay the full rate. It won't be capped by the other state, and your state won't issue a credit.

There might be exceptions, especially for private sales and you immediately transport the vehicle. But if you're buying a new, CPO or Inventory Tesla in Fremont, CA is adding 9.5% to the purchase price. No getting around that.