New car tax vs. Personal Property tax (pay, taxes, vehicle)

[Thinking-man]

If you buy a new car today, and pay a 4.1% tax (Virginia) on the purchase, when do you have to make your personal property tax payment? If you make the 4.1% tax payment when you make the purchase, have you essentially paid your personal property tax for one year for that vehicle, or are those two separate things? (ie. you paid 4.1% sales tax, and now you have to pay a % in personal property tax)

thanks for any input.

[freemkt]

In some states - dunno about VA but this is common - newer cars are taxed on value (purchase price the first year).

As cars decline in value over time, at some point the tax is shifted to some other basis, often weight; I think Michigan shifts to a weight tax in year seven.

You wouldn't get hit with both taxes in the same year, and the tax is usually paid at time of purchase. The Michigan weight tax is paid at time of registration renewal, I think the value tax on newer cars is also paid at registration renewal.

Any state or local tax on value ('ad valorem' tax), like your home property tax and your new vehicle value tax (even when applied to your registration fee), is deductible on your tax return. When your car is taxed on the basis of weight (or anything else besides value), that is not deductible.

[aus1ander]

Originally Posted by Thinking-man

If you buy a new car today, and pay a 4.1% tax (Virginia) on the purchase, when do you have to make your personal property tax payment? If you make the 4.1% tax payment when you make the purchase, have you essentially paid your personal property tax for one year for that vehicle, or are those two separate things? (ie. you paid 4.1% sales tax, and now you have to pay a % in personal property tax)

thanks for any input.

In my state, you pay sales tax and property tax (registration tax) at the time you pay for your car (tax, title, tags, and doc fees). The 4.1% you are referring to is just sales tax and is a one-time charge. You will pay for your tags (property tax) at the time of vehicle delivery as well.

[michgc]

If I remember correctly, you will get a bill for the personal property tax, and it will be prorated for the number of months you own the car for 2015. It is separate from the sales tax you pay at the time of purchase. (I lived in Virginia from 1999 until 2012.)

[reed303]

Originally Posted by Thinking-man

If you buy a new car today, and pay a 4.1% tax (Virginia) on the purchase, when do you have to make your personal property tax payment? If you make the 4.1% tax payment when you make the purchase, have you essentially paid your personal property tax for one year for that vehicle, or are those two separate things? (ie. you paid 4.1% sales tax, and now you have to pay a % in personal property tax)

thanks for any input.

Sales tax and Personal Property tax are 2 different things in VA. The State collects the Sales Tax. Each city or county collects their own PP Tax.
See Fairfax County's process as an example :
Car Tax*- Fairfax County, Virginia

FWIW, CT does the same thing. In CO, the "property tax" is collected by the state along with other annual license plate fees.

BTW, these Property Taxes are deductible on Federal Income tax if you itemize on IRS Sch A. And some states allow a credit on their state income taxes. ( CT = up to $200)

[NARFALICIOUS]

You pay the property tax separately from your sales tax.

Sales tax is paid with the purchase of the vehicle. Property tax is paid on a yearly basis.