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07-28-2011, 06:01 PM
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CC Member
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Join Date: Feb 2007
Location: Mesa, Az.,
AZ
Cobra Make, Engine: FFR MK3 #6288, IRS, 427W, TKO600
Posts: 9
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Not Ranked
Sales tax on kit cars
It was bad enough when the lady at MVD charged me state sales tax when I registered my Factory 5 kit ($1100 !). Now, the city of Mesa wants a cut too. I got this letter today:
The state of Arizona has notified this office that you registered the above vehicle to a City of Mesa address and that you have paid the 6.6% State Use Tax.
This letter is to advise you that the City of Mesa also imposes a City Use Tax at the rate of 1.75%. This tax must be paid directly to the City of Mesa as the State does not collect the City Use Tax.
City Use Tax is imposed on items acquired from a retailer for which an equivalent City privilege (sales) tax was not charged at the time of purchase.
Please return this letter to this office with the amount due within 30 days.]
blah blah blah...
There are blank lines for "Vehicle Purchase Price", "Less Trade-In", and "Amount subject to tax". None of these are filled in.
Have any of you had to deal with this before? I'll call them tomorrow and see if I can figure out what's going on.
Thanks,
Rich
__________________
FFR #6288, IRS, 427W, TKO600.
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07-28-2011, 10:04 PM
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CC Member
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Join Date: Apr 2005
Location: Tucson,
AZ
Cobra Make, Engine:
Posts: 5,391
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Not Ranked
Haven't gone through it myself but Tucson charged my brother a tax on his FFR.
Of course, like you, that's in addition to the state tax.
They told him it was a city road use tax. He asked when were they going to fix the road so he could use it.
Larry
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Alba gu brąth
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07-28-2011, 10:07 PM
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CC Member
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Join Date: Sep 2006
Location: No city...only 118 residents in Manter,
KS
Cobra Make, Engine: Cobra Auto Works body, Ron Godell Racecars chassis, 1989 Mustang GT 5.0 HO (converted to carb), W/C T-5, 3.73's in a Ford 9" Traction-Loc.
Posts: 812
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Not Ranked
Quote:
Originally Posted by LMH
They told him it was a city road use tax. He asked when were they going to fix the road so he could use it.
Larry
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LMAO @ Larry !!
Cheers from Dugly
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YD,E./PNB
No names were changed to protect the innocent!
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07-29-2011, 07:16 AM
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CC Member
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Join Date: Nov 2007
Cobra Make, Engine: Midstates/Shell Valley Street Cobra
Posts: 891
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Not Ranked
Why wouldn't the city use the same basis as the State ?
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07-29-2011, 07:52 AM
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CC Member
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Join Date: Aug 2003
Location: Gilbert,
AZ
Cobra Make, Engine: Backdraft #90, 351w,Tremec 3550, SB100 SOLD
Posts: 577
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Not Ranked
T-rex,
I would say as unpleasant as it is, just pay it and move on. Perhaps in the past this might have escaped the city of Mesa (or any other local city/town) but not now. They are scrambling for any money they can find.
You may have paid sales tax on parts and pieces that went into the car. There might be a way to deduct these taxes from your total tax. But, I am not sure about this either. This would have applied to your state tax as well. I have heard guys that were successful in doing this, but I am not sure this has been tried in Arizona. Maybe some guys from AZ can weigh in on this. Some states could care less about the sales tax you paid on parts to build the car (i.e. California) and tax the whole completed car by your total car cost including those taxes.
SkipB
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07-29-2011, 09:11 AM
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CC Member
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Join Date: Feb 2007
Location: Scottsdale,
Az
Cobra Make, Engine: ERA FIA #2119
Posts: 310
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Not Ranked
When I registered mine, Scotttsdale Airpark, the only thing I had to pay was for the for the license. I did bring reciepts for the motor, trans, paint etc. just in case but they did not even ask to see them. I did not pay any state or local taxes.
I did have to pay extra for the plate "NICEASP".
I agree with the other post, pay and avoid the grief and then enjoy the ride.
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07-29-2011, 02:45 PM
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CC Member
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Join Date: Feb 2008
Location: Paradise Valley,
Az
Cobra Make, Engine: FFR MK3/302/570 street avenger
Posts: 1,348
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Not Ranked
This is just the beginning. The state of Az will now have a question on your tax return asking you to report all internet purchases, and submit the tax you owe on them. If the info is left blank, your chances of being audited will go up.
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07-29-2011, 03:32 PM
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CC Member
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Join Date: Mar 2003
Location: Baltimore,
Md
Cobra Make, Engine: EM Replica, 427 s/o, Vette suspension
Posts: 84
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Not Ranked
Just send them a signed, blank check! You trust your government, don't you? (LOL)
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*** OF GREAT WORTH *** And JESUS asked again, The Kingdom of GOD, how shall we think about it, and to what can it be compared? Is it not like a Dark blue 427 Cobra, which a man found parked on his street one day? He hurried off and sold all that he had; the 57 Thunderbird, the 63 Stingray, the XKE, and bought the dark blue 427 Cobra. The disciples frowned and scraped their feet; JESUS grinned and popped the clutch. --- Harris Wolfe
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07-29-2011, 04:58 PM
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CC Member
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Join Date: Feb 2007
Location: Scottsdale,
Az
Cobra Make, Engine: ERA FIA #2119
Posts: 310
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Not Ranked
Quote:
Originally Posted by Scotchman
This is just the beginning. The state of Az will now have a question on your tax return asking you to report all internet purchases, and submit the tax you owe on them. If the info is left blank, your chances of being audited will go up.
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are you serious?
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07-30-2011, 07:29 AM
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CC Member
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Join Date: Feb 2007
Location: Mesa, Az.,
AZ
Cobra Make, Engine: FFR MK3 #6288, IRS, 427W, TKO600
Posts: 9
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Not Ranked
Quote:
Originally Posted by snakebitekit
are you serious?
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I sure hope not! But I also hope there aren't any politicians reading this forum; we don't want to give them ideas like that!
BTW, I tried calling the Mesa tax department yesterday, but they're only open Monday-Thursday. Guess I'll have to wait.
Rich
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FFR #6288, IRS, 427W, TKO600.
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07-30-2011, 11:55 AM
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CC Member
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Join Date: Sep 2002
Location: Mesa,
AZ
Cobra Make, Engine: FFR MK-I, 302, 780 Pro-Systems custom double pumper, 425HP
Posts: 595
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Not Ranked
I would losse the letter or rather you never received said letter.
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Mesa Mike
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07-30-2011, 01:57 PM
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CC Member
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Join Date: Mar 2005
Location: Mesa,
AZ
Cobra Make, Engine: FFR from Levy Racing 302 FI w/Edelbrock Performer heads
Posts: 1,644
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Not Ranked
What he said except with correct spelling.
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dave from mesa
Vietnam Vets may be eligible for medical care and disability compensation. Contact the VA if you have prostate cancer or type 2 diabetes. Finally got around to going to the VA.
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07-30-2011, 04:36 PM
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CC Member
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Join Date: Aug 2003
Location: Gilbert,
AZ
Cobra Make, Engine: Backdraft #90, 351w,Tremec 3550, SB100 SOLD
Posts: 577
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Not Ranked
What letter! Ha.
SkipB
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07-30-2011, 07:25 PM
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CC Member
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Join Date: Jan 2010
Location: Sun City West,,
AZ
Cobra Make, Engine: SPF2984 MK111, Roush 511 IR FE 8 Stack, Dynoed: [flywheel] 572HP at 6000 , 556# Torque at 4700, Bowler 4R70W Auto Transmision. Tires: Mickey T's S/R 26.0x10.0x15.0 F ,26.0x12.0x15.0 R Color, Bleck, because they told me it was Bleck, at the factory.
Posts: 1,480
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Not Ranked
Quote:
Originally Posted by snakebitekit
When I registered mine, Scotttsdale Airpark, the only thing I had to pay was for the for the license. I did bring reciepts for the motor, trans, paint etc. just in case but they did not even ask to see them. I did not pay any state or local taxes.
I did have to pay extra for the plate "NICEASP".
I agree with the other post, pay and avoid the grief and then enjoy the ride.
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Sent you a pm, btw its should be Glandale and not Mesa. tin-man
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Be well, drive fast, live long
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07-31-2011, 03:26 AM
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Senior Club Cobra Member
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Join Date: May 2007
Location: Mesa,
AZ
Cobra Make, Engine: Contemporary Classic, 428 FE CCX 3069
Posts: 7,506
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Not Ranked
Speaking of buying cars.. Skip, isn't your turn coming up soon? You should be having withdrawls anytime now.
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Dan in Arizona
CCX3209
"It's a great car and I love it, but it doesn't do 'SLOW' very well."
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07-31-2011, 05:00 AM
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CC Member
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Join Date: Apr 2009
Location: Phoenix,
az
Cobra Make, Engine:
Posts: 848
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Not Ranked
Having an internet business, I deal with use tax all of time.
The law is clearly on the side of the state, when you purchase the item from an out of state company that did not charge you sales tax. But the tax should not be assessed on anything over the purchase price on a kit car you bought, save your receipt.
If you assemble the car yourself and buy local parts that you paid sales tax, you should not be assessed use tax on those items. Receipts would be helpful.
If you used parts that you had laying around, there should be no tax on those items and purchases from a private party should also not be subject to use tax.
If you live in municipality that charges use tax, then you are also liable for the tax on the same basis as the state tax.
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07-31-2011, 05:19 AM
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CC Member
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Join Date: Nov 2007
Cobra Make, Engine: Midstates/Shell Valley Street Cobra
Posts: 891
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Not Ranked
Quote:
Originally Posted by Car Nut
Having an internet business, I deal with use tax all of time.
The law is clearly on the side of the state, when you purchase the item from an out of state company that did not charge you sales tax. But the tax should not be assessed on anything over the purchase price on a kit car you bought, save your receipt.
If you assemble the car yourself and buy local parts that you paid sales tax, you should not be assessed use tax on those items. Receipts would be helpful.
If you used parts that you had laying around, there should be no tax on those items and purchases from a private party should also not be subject to use tax.
If you live in municipality that charges use tax, then you are also liable for the tax on the same basis as the state tax.
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This, the only thing I might add is that you don't want to commit fraud. The City would have easy access to the basis for the State's tax.
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07-31-2011, 06:07 AM
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CC Member
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Join Date: Feb 2006
Location: Lake Havasu City, AZ,
AZ
Cobra Make, Engine: Arps/Burroughs/Hurricane/428FE
Posts: 1,346
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Not Ranked
If your original purchase order from the kit builder indicates that the motor and trans. were included (but not installed)as part of that purchase, the tax mightl more, or could be less than if you provide them with the separate purchase order for the engine and tranzs....get it!
Last edited by Bill Bess; 08-01-2011 at 04:51 AM..
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07-31-2011, 11:36 AM
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CC Member
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Join Date: Aug 2003
Location: Gilbert,
AZ
Cobra Make, Engine: Backdraft #90, 351w,Tremec 3550, SB100 SOLD
Posts: 577
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Not Ranked
Dan,
You are right. I have the itch. But thr 100 plus heat is making me wait a bit! Plus, I don't know what I want this time. Another Backdraft, maybe. Or what? Any suggestions for a local AZ car for sale?
As for taxes and kit cars. If you paid sales tax on everything you bought, I would think that would be deducted from the total tax bill. Also, I really don't know how it works in AZ, but in CA. you couldn't really buy the engine and transmission from the kit car vendor. That would constitute a "complete vehicle" meaning it would need airbags, smog equipment, etc. to meet current vehicle standards as if you bought a new car from a dealer. It may not apply here in the wild wild west of Arizona, but I am not sure. Anybody from Arizona know how this works?
I guess I am paranoid after moving from the Republic of Kalifornia. After all it took me 11 months to get my car titled there. I would just advise caution and staying under the government'r radar.
SkipB
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08-01-2011, 09:31 AM
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Senior Club Cobra Member
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Join Date: May 2007
Location: Mesa,
AZ
Cobra Make, Engine: Contemporary Classic, 428 FE CCX 3069
Posts: 7,506
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Not Ranked
Skip, The best buys I've seen lately have been on contemporary cobras. Like the green one with the 427 with duals and the whole magilla.
__________________
Dan in Arizona
CCX3209
"It's a great car and I love it, but it doesn't do 'SLOW' very well."
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