Has anyone ever traded a car in california? I hear you can bypass sales taxes by doing this, but how does it work?


Do you "gift" the car and put value as 0$?

Any information regarding this would be greatly appreciated!

bummmp.

CA doesn't do that. It was an unpleasant surprise since I moved here from TX, which does. But it's better than having a cop waiting at every highway overpass 'fishing', since they don't have state income tax either.


Go to CA.gov, and you can read all about CA car title law and procedure.

Thanks scurl, I was searching for quite some time now and that's what I thought.

Here's another question, I've sold quite a few cars and bought quite a few cars, now that I want to trade cars, would I simply just write up a bill of sale with a LOW AMOUNT (less than the buyer paid) in order to pay minimal tax?

I'm trying to read the procedures and all but I'm not really getting anything from it.

A normal private party transaction would involve the NRL, Bill of Sale (which the tax is based on, what's the lowest you could go without them objecting? I've gone as far as putting less than half the market value and the transactions have been fine) and the title.

A trade would work how? What forms do I sign and whatnot, just the title and NRL with sales price? There's really no laws stopping us from putting the sale price of like $100 or even 0, because it is technically honest.

I have traded before. I went into the DMV with the guy I was trading with, told them we were trading cars, said there was no money exchanging hands. We filled out some paper work and we were done. Just go into the DMV and ask. Worked for me.

I've never traded private party, so I'm not sure what the process is. Don't see how it would be any different from a straight sale, aside from the tax issue. You could try gifting it, and if any questions get asked you could say that there's no money exchanging hands.


It is true that you DO pay tax on the full sales price. In TX it just applies to the sales price minus trade-in value. So what P86 pulled off was extremely lucky, and I wish you the same.

Yeah it seems that everyone has a different experience, ambiguous laws ftl.

What I don't get is that is this recurring situation of people saying I have to pay full sales taxes, meaning what the market value is? Since it is similar to a private sale, why do I pay minimal taxes based on bill of sale price in normal circumstances, but in this situation I would have to pay full market value?


@ P86 when did you the straight trade?

I'm doing a straight trade also.

Full sales price means whatever you bought the car for. If you paid $1500 for an Alpina B7, then the the full sales price would be $1500.

However, "full sales price" is elusive in your situation. You might get an asshole clerk who wants you both to pay tax on blue-book. I dunno...



Personally I'd just ask a clerk, and if I didn't like what I heard, go to another.

Maybe 3 years ago. We didn't pay anything. Not a dime. The cars were the same though, same model, same year, just different colors and some slightly different mods. Don't know if that made a difference.