Will I burn for this?

[DarkCloud]

There are a lot of used BMW's being sold privately with a tons of accessories. Is it legal to have the owner sell you the bike and the accessories separtely? When you plate the bike the state tax you pay is based on the motorcycle purchase price. When the bike and accessories were new the state tax was paid on them when they were purchased.

Is this legal? Thanks, JON:brow

[Emoto]

I see no issue with two separate purchases, particularly if they are on different days.

I try to obey the law, but keeping money out of the government's hands is usually the best choice. :D

[BradfordBenn]

Originally posted by Dark Cloud
There are a lot of used BMW's being sold privately with a tons of accessories. Is it legal to have the owner sell you the bike and the accessories separtely? When you plate the bike the state tax you pay is based on the motorcycle purchase price. When the bike and accessories were new the state tax was paid on them when they were purchased.

Is this legal? Thanks, JON:brow

It should be legal. When I registered mine in IN, I just showed them the receipt from the dealer to verify the tax for the MOTORCYCLE.

HTH

[YB in IN]

I say go for it. You are purchasing the machine, not the stuff that bolts onto it.

[oldcarkook]

Well, let me rephrase the question for you:

If you buy a new BMW and pay $17k for it, then you hang another $7k in accessories (side car - the works) on it and the dealer then issues a bill of sale for the bike and the accessories, do you think that the dealer will charge sales tax on only the bike or the bike plus the accessories? It may be a state to state thing, but my money is on the whole enchilada, and not just the refried beans.

emoto: Do you actually think that this would fly with MADOR?
http://www.oldgmctrucks.com/smilies/rofl.gif http://www.oldgmctrucks.com/smilies/rofl.gif http://www.oldgmctrucks.com/smilies/rofl.gif

I hate the tax man like anyone else, but the reality is that if you had to pay a sales tax on the item if you bought it in a store, then it will still be taxable when you buy it used.

Hypothetically speaking, let's say that I were to buy a '96 R11RT and hypothetically speaking, let's say that the guy I bought it from was a really good friend and again, hypothetically speaking, let's say that he dummied up a bill of sale for me and put an amount on the title that was half of what I paid him for the bike so that I could hypothetically nick the tax man for the accessories which I bought (and extra $1500) and a bit more...hypothetically speaking.

Again, this is all hypothetical of course. Then I go to the Registry of Motor Vehicles to register the bike and the nice elderly lady behind the counter looks at the title and the amount and I'm hypothetically all set with a check for 5% of the amount on the title and the nice lady says "just a minute please" and picks up the phone and asks for a "Valuation on a '96 BMW R100RT" which means Kelly Blue Book. She then is given a hypothetically different price, which is hypothetically about twice the price that I hypothetically stated I had hypothetically paid. She smiles and explains that Registry laws require me to pay the higher fee (which was the lowest Kelly Blue Book value for the bike) but, that since hypothetically I am an honest taxpayer and not a person who would ever try to cheat the registry out of any due taxes, I can take along this nice little two page abatement form which enables me to provide duly notorized and sworn affidavit (*under oath) and all necessary documentation supporting my assertion of over paying the sales tax and then in five to ten years the Registry will rebate the over-payment. All of this is of course simply hypothetically speaking, but trust me, the tax man will extract what you fairly owe, one way or another.

Pay the sales taxes on what the law requires you to pay or register the bike in NH or Delaware! I can tell you first hand that it's not as simple as your say so...trust me...hypothetically speaking.

[BradfordBenn]

Old Kar Kook has some salient points, but it all comes down to one thing, do what you think is right. If a problem arises, I do not think saying to the judge, "Your honor the gang on BMWMOA Forum sez it is okay." is a good defense.

Having said that, there are all sorts of weirdnesses out there. Kind of like it is illegal to resell tickets in some states for more than 5% of face value. Can I interest you in a $100 T-shirt that comes with a free front row ticket?

I think you get the drift, the laws are always somewhat malleable, the key is that you do what you think is right and fair.

[Cliffy777]

I write a newspaper column for three small town publications. A short while ago I wrote this (forgot to include MC sales):

The state of Michigan, or maybe just the Secretary of State’s office, wants to train all of us to lie. The issue is the taxation on every sale of a car or truck throughout the lifetime of the vehicle. I cannot figure out why a vehicle has to be taxed on every sale.
You know the drill, right? You buy or sell a used car and get creative with the purchase price number so the State doesn’t collect quite so much money. Recently a close personal friend of mine had occasion to sell her used car and buy another one within a couple of days. By chance I happened to be present at both transactions.
During the sale, my friend volunteered to put down a lower purchase price on the car she sold to save the buyer money. In a brilliant display of instant karma, or else to prove my supposition, the person from whom she bought her car days later offered to do the same – without any prompting or suggestion from her.
Are these folks criminals or are they representative of all of us when we buy or sell a car? Obviously I believe they fit into the latter group, but I also believe that the silly practice of taxing car sales from assembly line to the bone yard puts pressure on people to lie.
[NOTE: the names, genders, and locations of these underreported sales have been changed to protect the guilty. By “Secretary of State” I am not referring to Terri Lynn Land personally, just the office she heads.]
Imagine Otto the Auto all shiny and bright at the dealership with a price tag of $20,000. Otto is sold and the state collects twelve hundred dollars in sales tax. Two years later Otto’s owner wants a new one, so he sells Otto for $14,000. The state collects another $840 bucks. Maybe it happens again at 10k, 8k, 5k, 2k, and finally when Otto isn’t so pretty anymore maybe $500 dollars and then for $150 to the bone yard. Assuming such a lifespan, Michigan will have collected at total of $3,579.00 or roughly 18% of the original purchase price of the car.
Why are they collecting all this money? So we can continue to wait in line with our little numbers in our hands at the local Secretary of State office? Other states collect sales tax on vehicles one time and one time only. This Michigan law indirectly teaches us to lie and cheat.
I used to sell radio advertising. We were on straight commission; if we didn’t sell we didn’t make money. It was risky, but we also did not have to punch a time clock or account for every moment of our day – after all if we failed to write business, then we failed to get paid. A new conglomerate bought the station and they wanted all salespeople to fill out daily reports accounting for their day in 30 minute increments. Did salespeople tell the truth? Heck no, all it did was force them to get creative. (Not me, I found another job before the new program kicked in.)
Michigan is just as silly as the company expecting daily reports from commissioned sales people. Why don’t we drop the façade and carry on in an upright manner?

[DarrylRi]

Cliffy, California, and I believe Washington, both collect sales tax on used vehicle sales, too. I'd be surprised to find a state that doesn't, actually. (Assuming that the state has a sales tax at all.)

[sgborgstrom]

It's been a few years but IIRC Illinios had a flat fee for sales tax on used bikes...$50.00? Nice for folks who like to experiment with different bikes, not having to take a big hit on the taxes everytime you decide to change rides.

The discussion makes me wonder about the size of the underground economy that the "Fleamarket", IBMWR marketplace and other on-line person to person sales points represent. There is a lot of money changing hands, most of it well under the radar of the taxing authorities.

Steve

[fish]

I'm not a tax lawyer, nor do I play one on the net, but I don't see a problem pricing accessories separately from the vehicle, especially if they are removable (not integral part of vehicle) and not dealer or manufacturer installed.

According to State of California Board of Equalization regulation 1610, use tax (not sales tax) is based on a sales price presumed to be equal to the fair market value of the vehicle. The presumption may be rebutted by evidence which establishes that the sales price was other than that amount. This evidence is a signed bill of sale.

Good luck getting FMV for motorcycle accessories.

Lastly, let your conscience be your guide. Pay your use tax on the amount you paid for the bike (less accessories) and go to town.

Just my $0.02 worth...

[flash412]

If I buy a set of saddlebags and pay, what, about $800 for them from Bust My Wallet and the city, county and state of Colorado collects 8%, that's $64. They're happy. If I later sell the bags to some other individual for say... $600, I am not required to collect sales tax from him unless I am a dealer. He ain't required to pay it either.

Now if I bolt those (new) bags on a motorcycle (on which I already paid sales tax), does that increase the value of the VEHICLE by $800? I think not. Since I can yank those bags right off and sell them, like I said above.

So a few years later, say I sell the motorcycle WITH the bags. Should the state collect another $48 in taxes on the bags just because I sold them to the same guy who bought the bike on the same day? I think not. Seems to me that since nobody (in Colorado) has to pay taxes for used vehicle accessories that weren't bought from a dealer, why the hell should they pay sales tax just because they were not in a cardboard box at the time of sale. Hell, for that matter, I'll take them off and PUT them in a cardboard box JUST to keep the state out of the buyer's pocket.

Matter of fact... those $800 bags are probably worth $1800 just cuz now they have a "patina" plus the history associated with ME owning them. So I guess I should knock that part off the price of the bike when I fill out the bill of sale, too.

Works for me!

[dlearl476]

Don't know about you guys in the backwoods, but where I come from they don't collect tax on private sales based on alleged "sales price" any more. (Haven't for years) You pay sales tax based on the NADA or some other used car guide. You buy a '66 Mustang (or a '66 /2) doesn't matter if you paid $50 or $50,000 for it. When you license it for the first time, you pay what the BOOK (well, the computer actually) says it's worth.
Now, if you buy it from a DEALER, he charges you sales tax on the total sales price. He has to by law. And with dealers, it wouldn't matter if you buy the accessories together or separately, the sales tax rate is the same.

[fish]

Originally posted by flash412

Matter of fact... those $800 bags are probably worth $1800 just cuz now they have a "patina" plus the history associated with ME owning them.


:rofl

[Doc nacho]

Here's another hypothetical idea......buy the bike used..get a receipt and a receipt for half the purchase price. Go to the DMV...give them the the lower of the two receipts. If they ask..tell them the bike is in really rough shape and in need of major repairs. (You think they're going to want to come to your house to make you prove it?) PrestO! Just a hypothetical solution of course. But my opinion is, Hey..they got their share when it was registered new....they don't need to double dip.