I found a couple cars that I like online, one is in Lincoln and the other is in Kansas City. They are both from dealers. Could someone walk me through the process of buying a vehicle out of state as this will be my first time doing so. Do you pay the tax to the state you are buying it from or do you bring it home and then pay the use tax to Iowa?
Buying a used car out of state
- Thread starter JWIL4CY
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I always buy my cars out of state now, but I'm ashamed to say that I don't even remember how the tax thing works. It seems like I paid Iowa taxes when I got back, but I'm not positive. Props to you for going out of state though to find something. The lack of competition in Iowa is literally a joke and I've always saved a good $3,000 to $3,500 by being willing to drive somewhere to get a car where there is actually competition. For instance, I made my last purchase in Chicago of a certified used Acura where I found 5 different vehicles spread throughout the city of the exact car I wanted (miles, color, interior... etc). I then proceeded to go one by one in checking them out with the intention to buy one of them. Shoot, it is easy to have confidence you'll find one you like when the sticker price is already a good $3,000 under any equivalent car in Iowa. Iowa dealers have got too used to the idea of being the only show in town. If you don't believe me in the pricing, just take a look at cars.com and run some comparisons yourself. It is truly a joke.
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I bought my first Evo out of state and for that matter don't remember the last car I bought in state. As far as taxes go, its a state by state case but last I remember, California is the only state I ran into that required you to pay state taxes there. The problem with this is that Iowa will require you to pay taxes also so you would end up getting double taxed. Washington did not require that so I only paid Iowa tax which I paid when I went to transfer the title and get plates. Hope this helps.
It has been a few years, but I ended up buying a car from a dealer in Des Moines while I was living in Kansas. As I recall, I did not pay sales tax at the time of purchase in Iowa. I then had to pay the tax to Kansas when I registered the call. The only real difference was that you couldn't wrap up the taxes in your overall financing, you had to pay it as a lump sum at registration. Of course if you don't plan to finance, or don't want to include the taxes in the amount financed, then it won't matter.
Had a similar experience (Live in MN, bought a vehicle in Illinois). I paid taxes at the MN DMV when transferring the title, etc. I didn't have to pay Illinois taxes.
I buy all my cars at woodhouse for the most part. I just tell them to take care of the tax and they do. Everything else just gets sent to the court house.
I think they write a check for the tax and send it in.
I think they write a check for the tax and send it in.
You pay taxes to the county that you register the vehicle in. So if your residence is in Polk county register it here and you'll pay Iowa taxes. Nebraska taxes on vehicles is astronomical. I've had peopel that I know that live in Nebraska try to find a way to have Iowa residency so that they can avoid paying Nebraska taxes. Everything is exactly the same for you so it doesn't matter if it's in or out of state.
As someone who is semi-looking into a new vehicle, I was surprised at the price of used cars. So I would at least take a few minutes and research what it would cost new.
I was looking at used Dodge Chargers and surprised at how little difference there was between new and used. Here is an example:
USED 2012 Charger R/T - 22,461 miles - $29,889
NEW 2013 Charger R/T - Similar specs - $29,562 (no leather), $31,560 (w/ leather to match used car)
Seems silly to buy the used one.
84 months is ridiculous. You're just hurting yourself if you do that. When you look at trading in 4-5 years, you'll be way upside down. Keep it at 60 months or less. If you can't afford a 5 year payment get a less expensive car.
Unless I'm not seeing something, Dodge has $3,500 cash allowance or $1,000 cash + 0% for 36 months.
Well I pay cash for most of my vehicles (if I dont lease them) so I dont really worry about financing. However what I was getting at was if youre buying say a $50,000 truck, I would rather have that $50,000 invested in something making me money or even in the bank getting interest. So really it's kinda stupid not to do 84 months. But thanks for your incorrect opinion.
This was in April, saw an advertisement in Omaha paper.
