Trucks are multifunctional automobiles that can be used by large families or by businesses. One of the hassles that people encounter when purchasing a truck, however, is the tax. Because a truck is a larger purchase and considered to be above the usual car, the tax laws that apply are different and can lead to bigger taxes. Here’s how you can compute for the taxes that will apply on the new truck that you are eyeing.
Sales tax. The first tax that you must pay when you acquire a new truck is the sales tax. This is also one of the easiest taxes to determine, since you will only need to multiply the cost of the truck with the sales tax percentage rate. Keep in mind that each state has different sales tax that apply to the new truck, so check with the IRS first to determine the rates that will apply to your car. You can also visit the IRS website to determine the rate for the sales tax in your area.
Gas Guzzler tax. In an effort to promote fuel efficiency, there is a tax titled as the Gas Guzzler tax, which penalizes cars and trucks that have high fuel consumption. If your truck is determined to be under the Gas Guzzler tax, you will also need to pay for this. You can determine whether the particular car is considered a Gas Guzzler by checking the automobile maker’s website where the car’s taxes should be listed. The state where you live can also be a factor in determining whether the particular truck model that you are planning on purchasing is under the Gas Guzzler tax.
State usage tax. The state usage tax is a special tax that applies in certain states for certain car and truck models. If you have a truck that is eligible for the state usage tax, you will need to pay for the use of the truck in your state. One of the advantages with buying a truck, however, is that the state usage truck only applies in several areas and in specific models of trucks.
Registration tax. Once you have a new truck, the next step is to get it registered. This will also cost you some tax money. The amount of registration tax is determined by the size and the weight of the truck that you have purchased. Usually, you can get the registration tax for your specific vehicle by checking out the DMV website, or by calling the office.
Fuel efficiency tax credits. There are plenty of taxes that you will need to pay for when you purchase a new automobile such as a truck. But, there are also tax credits that you can avail of, such as fuel efficiency credit. Trucks that are fuel efficient will have a tax reduction. Depreciation is another tax credit that can lessen the tax load for your truck throughout the years.
Through these steps, you should be able to get an idea of how much tax you will need to pay when you purchase a new truck. You can include these tax fees in your budget when looking for a new truck, and can narrow down your search for trucks that provide tax credits, such as those that are fuel efficient.