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Help Please! Tax Up-Front Saving on Lease

976 views 5 replies 3 participants last post by  iSpY 
#1 ·
Hi all,

I am very confused right now and hope someone can help me out here.

I am trying to close a lease deal and using the lease calculation spreedsheet, I should able to save some money by pay the 'tax' upfront.

However, my dealer told me that this is not possible in California. Is that true? Some say yes and some say no and I am really lost......

Thanks for all your help in advance!

i-spY
 
#2 ·
It is not common practice to pay the sales tax up front in CA. Just pay it each month with your lease payment.
 
#3 ·
Yeah, I know that. But I was using the 'spread sheet' (See Lease payment calculation thread) and there is an option to pick either 'roll the sales tax into monthly payment' or pay the sales tax upfront (with some saving). That's the reason I am asking.....

i-SpY
 
#5 ·
Your problem is with the spreadsheet... California taxes the payment each month... Nothing is due until that month. There can be no savings by paying upfront (not possible, either).

If you live in NY, Texas, etc, etc.., the rules are different.
 
#4 ·
Tax in California is charged on both the depreciation amount and the finance charge. Even if you pay for the tax on the depreciation up front, you will still need to pay tax on the finance charge when it is applied. Either way, don't you pay the same amount in tax?

How can you save money by paying the tax up front?
 
#6 ·
Thanks all,

Now I have a better understanding....

i-SpY
 
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