Sales Tax Affidavit

If you have an insured total loss of a vehicle, the amount paid out by insurance, if put toward a new vehicle, is sales tax–exempt.  You just have to ask the insurance company for a “sales tax affidavit.”  They will not tell you about this.  You have to ask for it explicitly, and make sure you get both a digital and a hard copy.

In my case, I was paid $5.9K on my total loss.  I purchased a new vehicle for $8K and paid sales tax on only the difference of $2.1K.  It is a substantial savings, but not one person to whom I have imparted this knowledge knew about it previously.  I am grateful to the friend who told me about this windfall.

So spread the word!  For once, the tax code works for the people!

Read more at “A legal loophole everyone should know about”

See you at the first tee…

A state-by-state guide to exemption certificates