WA State Alternative Fuel Vehicle and Plug-In Hybrids Tax Exemption for i3 - Bimmerfest - BMW Forums



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BMW i3 I01 (2014 - Current)
The BMW i3 and BMW i8 are the first two cars launch under BMW's new sub brand BMW i. The i3 is an all carbon fiber, all electric vehicle meant for urban mobility.

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  #1  
Old 04-21-2017, 06:01 AM
NetWerker NetWerker is offline
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WA State Alternative Fuel Vehicle and Plug-In Hybrids Tax Exemption for i3

Hi all, Does anyone have experience with the Alternative Fuel Vehicle and Plug-In Hybrids Washington State Tax Exemption?

How exactly does that factor when leasing a new i3?

http://www.dol.wa.gov/vehicleregistr...xemptions.html

Thanks!



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  #2  
Old 04-21-2017, 06:47 AM
mrMTB mrMTB is offline
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"The exemptions are limited to vehicles sold for $35,000 or less, or vehicles that are leased and have a fair market value of $35,000 or less at the start of the lease."

As it was amended, the exemption, it appears, no longer applies to the i3.
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Old 04-21-2017, 08:17 AM
NetWerker NetWerker is offline
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That's too bad...

Assuming the i3 was still eligible, How would we have taken advantage of that during a lease? Is there no sales tax added to the lease payments, or was it used as a deduction during tax time, or what?

Thanks!


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Old 04-21-2017, 08:36 AM
mrMTB mrMTB is offline
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On a lease you would not have paid tax with the monthly payment. As it stands, provided you itemize taxes, you can still write this off in Schedule A.
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Old 04-21-2017, 01:58 PM
NetWerker NetWerker is offline
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Thanks again for your help on this. As I read deeper though, I'm not so sure that the i3 is no longer eligible. According to below, beginning July 1, 2016 it sounds to me that up to $35,000 in lease payments would still qualify (the vehicle no longer has to have a selling price of less than 35k).

~Clean Alternative Fuel and Plug-In Hybrid Vehicles Sales/Use Tax Exemptions~

Available To:
Any person.

Qualifying Activity:

From July 1, 2009 through June 30, 2015:
Purchase or lease of a new passenger car, light duty truck, and medium duty passenger vehicle that is powered exclusively by clean alternative fuels.


From July 15, 2015 through June 30, 2016:
Purchase or lease of a new passenger car, light duty truck, and medium duty passenger vehicles which is:

-powered exclusively by clean alternative fuels; or
-a plug-in hybrid capable of traveling at least 30 miles using only battery power.
-The exemptions are limited to clean alternative fuel vehicles or plug-in hybrids whether sold or leased for $35,000 or less. The amount of any traded-in vehicle may not be deducted when determining the price of the vehicle.
-For leases signed on qualified clean alternative fuel vehicles before July 1, 2015, lease payments will continue to be exempt from sales tax regardless of the fair market value of the lease.



From July 1, 2016 through expiration of exemptions:
Purchase or lease of a new passenger car, light duty truck, and medium duty passenger vehicle which is:

-powered exclusively by clean alternative fuels, or
-a plug-in hybrid capable of traveling at least 30 miles using only battery power, and
-is on the list of qualifying vehicles as determined by DOL. See DOL's list at: http://www.dol.wa.gov/vehicleregistr...xemptions.html
-The exemptions apply up to $32,000 of a vehicle's:
-selling price or
-the total lease payments made or
-if the original lessee purchases the leased vehicle before the exemptions expire, the total lease payments made plus the selling price of the leased vehicle



Reporting/Documentation Requirements:

-No application
-No Annual Survey/Report
-Dealer must keep records to substantiate the exemption


Exemptions expire on whichever of these comes first:

-when the total number of qualifying vehicles titled in Washington on or after July 15, 2015, reaches 7,500 vehicles or
-July 1, 2019



Curious to hear what everyone thinks. Am I interpreting that right?

Thanks again!

Last edited by NetWerker; 04-21-2017 at 02:04 PM.
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Old 04-21-2017, 04:11 PM
mrMTB mrMTB is offline
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I think you're right... I'm on the phone with Department of Revenue right now trying to figure out how to untangle this.
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Old 04-21-2017, 08:10 PM
NetWerker NetWerker is offline
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Oh nice, definitely interested in hearing what they had to say.

Thanks for doing that!
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Old 04-21-2017, 10:40 PM
trubluluder93 trubluluder93 is offline
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I'd check with MJBrown62, a CA in Seattle. He's always willing to look into clearing up technicalities
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Old 04-22-2017, 08:24 AM
NetWerker NetWerker is offline
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Thanks trubluluder93, I PM'd MJBrown62 to see if he can clarify as well.

Regarding the $7500 Federal Rebate/Lease Rebate, an offer I just received from my local dealer has me paying Tax upfront on the $7500 Rebate ($667.50, calculated at WA state sales tax rate of 8.9%). Is that typical?

Thanks!
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Old 04-22-2017, 09:45 AM
MJBrown62 MJBrown62 is offline
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The way we have operated without any issues with the State is if you lease, you will be tax free on monthly use tax and cap reduction (the rebate and your cash down)

We're not charging sales tax on cap reduction as the total transaction (lease payments and cap reduction) is usually under $32,000.

The $32,000 selling price for tax relief on a purchase is the tough one.

Best to lease it!

mjb
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Old 04-22-2017, 03:03 PM
NetWerker NetWerker is offline
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Quote:
Originally Posted by MJBrown62 View Post
The way we have operated without any issues with the State is if you lease, you will be tax free on monthly use tax and cap reduction (the rebate and your cash down)



We're not charging sales tax on cap reduction as the total transaction (lease payments and cap reduction) is usually under $32,000.



The $32,000 selling price for tax relief on a purchase is the tough one.



Best to lease it!



mjb



Thank you for that information sir, very helpful!
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Old 04-24-2017, 08:37 PM
jadnashuanh jadnashuanh is offline
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The NH legislature has discussed whether to implement a fee for EVs. I'm glad they haven't so far. Some other states have experimented with eliminating the per/gallon tax on fuel, and charge people alternatively for the number of miles driven. I do not know where this all will end up. An EV still adds wear to the roads and bridges, but, as of now, isn't paying anything towards their upkeep or expansion. I think, at least in NH, they felt the cost to implement the infrastructure to collect that per-mile tax exceeded the revenue it could bring in. That may change as more and more EVs show up on the roads. Even though we are driving more, and there are more cars on the road, the tax revenue has been flat because of the improvements to the fleet efficiency improvements. Nobody likes more taxes, but fixing things doesn't come without costs...somebody has to pay for it. Other than places where they subsidize fuel costs (fuel is cheap in the Middle East for example in most countries), most people end up paying a lot more for their fuel than people in the USA. That, I think is one reason why our roads and bridges aren't in great shape.
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