05-30-2008, 04:44 AM
I bought a car from a automotive group. I paid the sales tax since they say that Arizona is a reciprocation state to massachusetts in that I will not have to pay sales tax when I register the car here in Mass.
Problem is they say that they have to first title the car in my name in ARIZONA, Then the Arizona registry will send the title to me in Massachusetts so that I can turn it into a Mass title. I asked the dealership why they could not just sign the title over to me personally so that I can take the title to the mass registry and title the car instead of waiting for an Arizona Title in my name to appear. They said because I am not a dealership they cannot transfer the title directly to me, they have to title it in my name at the registry in Arizona.
Is this right? I dont know why I have to wait 3 weeks or so for my title to show up and then retitle it in mass and wait another three weeks to receive the title. Also, I cannot drive the car or legally do not even own the car until the title shows up Hopefully someone here can help me out with this. I am very confused.
05-30-2008, 05:04 AM
I've seen this happen when a car is sold on consignment, and is not in the dealers name, but don't have first hand knowledge of arizona. Good luck.
05-30-2008, 05:21 AM
The January auctions are very specific on Arizona law concerning the transfer of title on cars in Arizona between individuals who are not licensed dealers. Per information provided by BJ, Silver and Russo, the payment of taxes and registration of the car depends upon when you, the retail buyer, take physical posession of the car. If you take possession of the car in Arizona, you pay Arizona tax. Ship it out of the state through a third party transport, pay tax in your state of residence.
I am a licensed dealer in Tennessee and therefore have never had to worry about this issue when buying cars in Arizona. Just remember, EVERY state is out for all the sales tax revenue they can get and Massachusetts "may" tax you AGAIN since you were never a resident of or property owner in the State of Arizona and therefore may not have the legal right to register the car in Arizona in the eyes of the State of Massachusetts. The State of Massachusetts "may" look at this as avoidance of sales tax that they are legally due! I would check with your State of Massachusetts Department of Motor Vehicles. I am sure this is not the first time this issue has come up.
All this applies if you are not a licensed dealer. If the car is transported out of the state by a third party transport and you, the buyer, do not take posession of the car in Arizona, you do NOT have to pay Arizona sales tax and register the car in Arizona. If you do take retail possesion of the car while in the State of Arizona, then you must pay sales tax and register the car is Arizona. You will then turn in the Arizona title in your state of residence and through your states registration process.
It all boils down to the fact that Arizona has figured out a law that makes out of state retail buyers who take possesion of a car in the state of Arizona pay tax in Arizona and SCREW all the other states on sales tax. This is NOT a reciprical agreement. Arizona does not send the sales tax money to Massachusetts! The only reason you will not pay sales tax in your state of residence is the fact that you will be transfering the Arizona title that is already in your name and therefore the car is already your personal property upon which you have already paid sales tax. It's just like you were moving to the state you live in and already owned the car. You do not pay sales tax on the car when you register it in your new state of residence during a move because you already own the car!
All this boils down to 2 issues:
1. When and where will YOU take physical possession of the car?
2. Which state has the cheaper sale tax rate to benefit you?
After you answer these 2 questions you can decide which is best for YOU! My guess is that it has to be cheaper to register the car in Arizona than in Massachusetts. You will have to check that out.
The key to this whole issue is WHERE you will take physical pocession of the vehicle! That will determine what options you will have.
If any of this information is incorrect, thank BJ, Russo and Silver as this is the information they provide in their bidder package.
As far as driving the car, the dealer in Arizona MUST provide you with complete and proper Arizona license plates and registration the instant you take physical possession of the car in Arizona. You will be legal to drive the car anywhere in the United States.
If you are shipping the car to you and NOT taking possession in Arizona and the dealer STILL tells you that he MUST collect sales tax and registration, I would call the Department of Motor Vehicles in Arizona and confirm the laws concerning payment of sale tax and registration for vehicles being shipped out of Arizona. Hell, you should do this anyway!!!!!