Question about taxes (Texas)

[Rytrox]

Hello,

I am preparing for my delivery on January 28th and I was told yesterday that taxes are paid separately from the order, and at a later date (atleast in Texas). Previously I was led to believe that taxes would be included in the final bill price. The exact statement from my sales rep is below:

"There was an update with our order process taxes are paid at the DPS and registration is done by the customer there. 2 weeks after delivery you will get a packet with instructions on how to do it."

When did this start happening in Texas?

Also, I heard there was some tax deduction for trading in a car as well? Will this be taken into account when I have to pay the taxes after delivery or does that not apply anymore?

Anyone else dealt with this?

Thank you!

 

[Rockster]

Texas law states that when you trade a car in on a new purchase you pay the net sales price (i.e., the remaining amount after your trade-in is deducted). That said, the change in sales tax payment process that you've described is puzzling because that's how it used to be but it changed some time ago, prior to my Model 3 purchase 22 months ago. Our first Tesla, bought back in 2013, involved going to the tax office and writing a painful check for 6.25% of the purchase price. Subsequently, however, the purchase of our 3 was streamlined and included the state sales tax in the amount paid to Tesla and they took care of it. (Actually, I believe they subcontracted it out to a third-party service who took care of taxes, licensing, etc.) and we received our plates and registration stuff in the mail without any further action on our part.

I wonder if they have stopped using the third party and it's now back on the Texas customer to take care of all that?

 

[Rytrox]

Texas law states that when you trade a car in on a new purchase you pay the net sales price (i.e., the remaining amount after your trade-in is deducted). That said, the change in sales tax payment process that you've described is puzzling because that's how it used to be but it changed some time ago, prior to my Model 3 purchase 22 months ago. Our first Tesla, bought back in 2013, involved going to the tax office and writing a painful check for 6.25% of the purchase price. Subsequently, however, the purchase of our 3 was streamlined and included the state sales tax in the amount paid to Tesla and they took care of it. (Actually, I believe they subcontracted it out to a third-party service who took care of taxes, licensing, etc.) and we received our plates and registration stuff in the mail without any further action on our part.

I wonder if they have stopped using the third party and it's now back on the Texas customer to take care of all that?

Wow, thank you for the insight. Having to go to the tax office is a pain but as long as the trade in is taken into account I don't mind doing it. I wonder why it all changed though...

 

[ElectricIAC]

Hello,

I am preparing for my delivery on January 28th and I was told yesterday that taxes are paid separately from the order, and at a later date (atleast in Texas). Previously I was led to believe that taxes would be included in the final bill price. The exact statement from my sales rep is below:

"There was an update with our order process taxes are paid at the DPS and registration is done by the customer there. 2 weeks after delivery you will get a packet with instructions on how to do it."

When did this start happening in Texas?

Also, I heard there was some tax deduction for trading in a car as well? Will this be taken into account when I have to pay the taxes after delivery or does that not apply anymore?

Anyone else dealt with this?

Thank you!

Was in final bill for us and handled by “title girl”

 

[Rockster]

Was in final bill for us and handled by “title girl”

Yes, same here. I wonder what changed?

 

[EV-Tiger]

I paid for and took delivery of a new Model X in Texas in late December 2019. The Texas sales tax amount was listed on my "TESLA MOTOR VEHICLE PURCHASE AGREEMENT Final Price Sheet". It was listed on Line 2D and I paid that amount to Tesla.

Sooooo... , this change must have taken effect January 1, 2020.

 

[ElectricIAC]

I paid for and took delivery of a new Model X in Texas in late December 2019. The Texas sales tax amount was listed on my "TESLA MOTOR VEHICLE PURCHASE AGREEMENT Final Price Sheet". It was listed on Line 2D and I paid that amount to Tesla.

Sooooo... , this change must have taken effect January 1, 2020.

If this is so, just Texas making it harder to buy Tesla as usual...sigh.

 

[HtownMY9999]

I paid for and took delivery of a new Model X in Texas in late December 2019. The Texas sales tax amount was listed on my "TESLA MOTOR VEHICLE PURCHASE AGREEMENT Final Price Sheet". It was listed on Line 2D and I paid that amount to Tesla.

Sooooo... , this change must have taken effect January 1, 2020.

This is really confusing. I've seen forums from several years ago that say taxes were separate and people had to make a trip to the DMV to pay the 6.25%. Then here is your comment from earlier the same year saying that taxes were rolled up into the MVPA. I'm staring at my Final MVPA and line 2D is $0.

Wtf... I guess I'll be making a trip to the DMV to shell out a few grand after I pick up my car.

 

[Siromnom]

Wtf... I guess I'll be making a trip to the DMV to shell out a few grand after I pick up my car.

The process has changed over time... currently, it is up to us to pay taxes when we register...Tesla no longer does this for us. Can thank the state for the barriers they have up...

 

[Themidnightfox]

The process has changed over time... currently, it is up to us to pay taxes when we register...Tesla no longer does this for us. Can thank the state for the barriers they have up...

Does Tesla help with registration at all? Like are they gonna say “do this, do that” or is it up to me to just reach out to the DMV and figure it all out on my own?

 

[Siromnom]

Does Tesla help with registration at all?

Honestly I'll be going through it my first time with Tesla too...so someone else who has done it more recently may have better guidance, but my understanding is they will send us the title and other documents after delivery...then we need to go ourselves to turn in forms and get plates, etc. This is when we pay taxes. I'm sure if you reach out to your SC or even your local tax assessor office, they can walk you through it. I've registered non-Teslas in TX myself and frankly it's quite easy...that or my county makes it easy.

 

[brkaus]

Tesla / title girl was a mess. My final receipt from the state showed a few penalties payed by Tesla for being late.

 

[Saint S2K]

The issue in Texas is that the other car dealerships have lobbied and barred Tesla to operate as a vehicle dealer in TX. Thus, they don’t do the registration and tax stuff that other dealers do. This is also why the vehicle has to be paid in full prior to delivery. The purchase is considered an out-of-state transaction. So similar to purchasing a vehicle in a different state then driving home to Texas, you will pay taxes when you register the vehicle at your local DMV office.

 

[Themidnightfox]

The issue in Texas is that the other car dealerships have lobbied and barred Tesla to operate as a vehicle dealer in TX. Thus, they don’t do the registration and tax stuff that other dealers do. This is also why the vehicle has to be paid in full prior to delivery. The purchase is considered an out-of-state transaction. So similar to purchasing a vehicle in a different state then driving home to Texas, you will pay taxes when you register the vehicle at your local DMV office.

So I happen to be moving out of Texas to another state very shortly... would it be crazy to just wait and register my car/pay taxes there?

 

[Saint S2K]

So I happen to be moving out of Texas to another state very shortly... would it be crazy to just wait and register my car/pay taxes there?

I’d contact the DMV for the state you are moving to and check to see. Few factors come into play such as how long till you move and stuff. Biggest thing is check the sales tax rate. TX is 6.25% so if the state you are moving to is lower that sounds like a good option.

 

[GeorgeC1]

So I happen to be moving out of Texas to another state very shortly... would it be crazy to just wait and register my car/pay taxes there?

You can try but the new state may have a lot of questions about mileage on the car and the length of time between purchase and registration. Tesla will give you a MSO that you turn in when you title the car. You also have the issue of trying to drive a untitled and registered car. Some states will tow and impound the car if they catch you.
A better option might be to title the car as soon as you purchase it in the new state. Driving it in Texas with a out of state plate should not be a issue for a short period of time.

 

[TesslAshanti]

The issue in Texas is that the other car dealerships have lobbied and barred Tesla to operate as a vehicle dealer in TX. Thus, they don’t do the registration and tax stuff that other dealers do. This is also why the vehicle has to be paid in full prior to delivery. The purchase is considered an out-of-state transaction. So similar to purchasing a vehicle in a different state then driving home to Texas, you will pay taxes when you register the vehicle at your local DMV office.

Thank you for this