What is involved in purchasing a vehicle out of state (Tax and fees) Thanks for your insight with this?
I live in Mississippi and I am wanting to purchase a truck from a dealership in Louisiana and the dealer is charging me 5% sales tax. Ok, will I be charged any thing extra when I go to buy the tag or is there anything else I should know about buying this vehicle out of state as far as fees or taxes? Thanks so much for your help
- Anonymous1 decade agoFavorite Answer
Please check your DMV and or sales tax laws carefully. Most states have a reciprocal sales tax agreement but there are exceptions. Arkansas and Mississippi are frequently on the exception list but since these are agreements made between states they could be reciprocal with some states but not all. Non-reciprocal states do not recognize the sales tax collected in another state and residents of those states could pay sales tax twice on an out of state purchase.
The dealer in the state of purchase may be required to collect sales tax but a non-reciprocal state would not recognize that collection and the buyer would pay again when they went to register the vehicle in their home state.
There is a way to avoid this. Have the Louisiana dealer deliver the car to you in Mississippi by driving it across the state line. Because the dealer is delivering the vehicle out of state, they are not required to collect sales tax on the sale. You will have to pay the sales tax when you register the vehicle but you only pay once.
- FirebirdLv 71 decade ago
Don't do it. You should be paying Sales Tax in Mississippi. I wouldn't give them a nickel until you're 100% sure (not because of what we say) that you're doing it right. Call the DMV and asked them what your'e supposed to do.