Transfer from my son to myself, do I need to pay tax in CA?

[Roy2001]

My son is in college and he could buy an EV with $7500 off next year thanks to new tax rebate policy that he does not need to owe $7500 tax to claim it.

Now my question is, if he is going to buy a Lightning and transfer it to me, do I need to pay tax (again)?

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[bmwhitetx]

This is not the forum to seek tax advice Try Bogleheads. Depends on state laws, exactly what you're doing, etc. But I'm sure you'll get definitive answers here.

 

[Roy2001]

This is not the forum to seek tax advice Try Bogleheads. Depends on state laws, exactly what you're doing, etc. But I'm sure you'll get definitive answers here.

This is not for income tax or so. It is about sales tax.

I think it is more related to this forum than the tax expert.

 

[Maquis]

1. Illinois doesn’t charge sales tax when transferring a vehicle to an immediate family member. I’d think other states would be similar.

2. A person buying an EV with the intention of selling it cannot claim the $7500 tax credit.

 

[Roy2001]

1. Illinois doesn’t charge sales tax when transferring a vehicle to an immediate family member. I’d think other states would be similar.

2. A person buying an EV with the intention of selling it cannot claim the $7500 tax credit.

Thank you for reply. Hope CA won't charge tax as well.

For #2, I can transfer soon or later right?

 

[emptykim]

Title Transfers and Changes - California DMV

 

[Roy2001]

Title Transfers and Changes - California DMV

Thank you! Looks like the answer is yes.

 

[Maquis]

For #2, I can transfer soon or later right?

Im not a tax professional, but imo, the law was written specifically with what you want to do (use a straw buyer to qualify for the credit you don’t qualify for) in mind.

 

[jimfigler]

1. Illinois doesn’t charge sales tax when transferring a vehicle to an immediate family member. I’d think other states would be similar.

2. A person buying an EV with the intention of selling it cannot claim the $7500 tax credit.

NY you can sell a vehicle for $1 to an immediate family member

 

[Tfarrell73]

I thought I read that for the federal EV rebate you have to own it for a year?

 

[Roy2001]

I thought I read that for the federal EV rebate you have to own it for a year?

Thanks for info, yes I will only transfer after at least 12 months.

 

[laselvasurf]

You'll need to submit an additional form, but you won't need to pay sales tax again.

https://www.dmv.ca.gov/portal/file/statement-of-facts-reg-256-pdf/

 

[Roy2001]

You'll need to submit an additional form, but you won't need to pay sales tax again.

https://www.dmv.ca.gov/portal/file/statement-of-facts-reg-256-pdf/

Thank you!

 

[BEVolution]

What State will OP register the vehicle?

 

[Txxthie]

What "new tax rebate policy"? The EV tax credit doesn't work by owing money. It works by having having enough taxable income to qualify. If you W2 Federal withholding on your pay stub shows $7500 or more, you will qualify for the full tax credit. You can also co own the vehicle to qualify for the credit. Note: Only 1 party qualifies for the credit and also receives it.
In 2024 the tax credit can be applied at the time of sale, which has lead some to believe they can get it without having enough taxable income. The government will "recapture" whatever you don't qualify for and also be subject to a 20% penalty.

It is nicely described in this video.

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