Has anyone ever traded motorcycles before? How do you write it up on the titles? What do you have to pay for tax at the DMV? I'm swapping my bike for another guy's bike plus he's giving my 2 grand. Just wondering what I'm going to have to pay for tax at the DMV when I get the title in my name, since I don't have any more "net value" than I started with. I think FL tax on vehicles is 7.5%, so that would be 750 bucks for a 10 grand motorcycle. Thanks for help.
I've always just written up a bill of sale for some "reasonable" price and gotten the other guy to do the same. Just be sure to keep a copy of your BOS signed by the other guy in case you need it. I figured if I went to get a tag and they start asking questions I"ll just say well I bought this guy's bike and as soon as I handed him the cash he decided he liked my old one so he handed the money right back
Yes, I see what you mean. I was reading on the FL DMV site, and it says The state of Florida imposes 6% sales tax on the full purchase price less trade-in; So if the bikes were equal value, it seems like we wouldn't have to pay any sales tax. Mmmm..... So would the other guy only have to pay sales tax on the 2K?
When the DMV is concerned there always needs to be a price. Best bet is just to sell both for $1.00 and not report the extra cash.
LOL, yes, I did that once when I bought an R1 from a friend. We never even wrote up a bill of sale, he just gave me the title after he paid the bike off. It was a track bike, so I didn't even register/title it for a couple of years after the purchase. The lady at the DMV scoffed at the $1.00 purchase price, and said it was better to write it up as a gift, much less suspicious.
The $1 purchase price "trick" doesn't work. The states figured that one out decades ago. If you put down $1 as the sales price, they will automatically "adjust" the tax to reflect a standardized value for the vehicle. This applies to any ridiculously low sales price.
I would start with book value and drop a grand or two. Get a notarized bill of sale and you will have no problems on either end. The state will always want its money, so sales tax will always apply.
I always put a low sale price and tell them it was not working, kind of a fixer upper or that it had lots of scrapes and will need painting or something.
Well, I just called up the DMV, they said on the title on the selling price, just put "EVEN TRADE" and no sales tax will apply. Thanks for all your help, I didn't realize it would be that easy.
My personal favorite was a deal where a bike was sold for "$1.00 and a dozen donuts" dmv went crazy trying to figure tax on a dozen donuts:up:
FYI - PA DMV sent me a letter asking why my price was so low as according to their records (some book value?) the R1 was worth $3k more than I "paid". I wrote back w/ a BOS we signed to the low price and said it was damaged and required over $3k in repairs. Never heard back... IMO - it's worth paying a few bucks in taxes w/ a BOS to back up the "facts"... that and have a friend at the tag place that pushes things thru for you no questions asked (a few boxes of donuts once in a while always helps!) Scott
