My question involves a consumer law issue in the State of: PA and NY
Now I understand when buying a new car out of state, you are taxed on your residency, not where buy but my confusion is around trade in.
Here in NY when you trade in car, you aren't taxed on that trade in value. You are taxed on the difference between purchase price and trade in.
But how would that work if I were to buy/trade in at dealer in different state... Particularly PA who has slightly lower sales tax.
Example using rough numbers here are the 2 scenarios :
1. Buying and trading at a NY dealership here in NY where I live :If I buy a $25k car before tax and trade in a $20K car, I'll be taxed on $5k at our local sales tax rate.
2. Buying and trading out of state in PA. Buy a $25k car before tax but trading in a $20k car. What amount will I be taxed when it is registered in NY? $5K or the full purchase price of $25k?