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 The cash for clunkers catch!

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attack-cat

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Posts : 456
Join date : 2008-03-14
Location : Conesville - personal hell

PostSubject: The cash for clunkers catch!   Thu Aug 27, 2009 6:06 pm

http://www.businessinsider.com/whoops-cash-for-clunker-participants-dont-realize-their-rebates-get-taxed-2009-8


Some of the drivers that bought new cars through cash for clunkers are learning that it wasn't quite the deal they hoped for.

Keloland Television: But many of those cashing in on the clunkers program are surprised when they get to the treasurer's office windows. That's because the government's rebate of up to $4500 dollars for every clunker is taxable.

"They didn't realize that would be taxable. A lot of people don't realize that. So they're not happy and kind of surprised when they find that out," Nelson said.

We imagine that MOST people didn't know the rebates were taxable. We certainly didn't.

Karl Denninger calls this hilarious, and explains the mix up:

The amusement here is how most (if not all) states compute sales tax (charged when you register the vehicle.)

When you buy a new car you pay tax on the difference between the new car's purchase price and the trade-in you present to the dealer. This is an intentional distortion in the law that is intended to favor dealers over private-party used car sales; if you sell your used car privately the new buyer pays sales tax but you do not get the offset on the purchase of your replacement vehicle - the only way to get that is to trade the car.

Dealers use this, of course, in negotiations, effectively pocketing the sales tax - and why not? It's a real difference to you!

But the "cash for clunkers" is not a trade-in. That's a $4,500 check from the government, basically.

So you get nailed at least once and possibly twice. Specifically, you pay sales tax on the full vehicle price (effectively paying sales tax on the $4,500!) and what's worse those states that tax income (that would be most of them!) might wind up counting this as income for state income tax purposes too, effectively taxing you twice.

Read the whole thing at Market Ticker →
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madcow

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PostSubject: Re: The cash for clunkers catch!   Fri Aug 28, 2009 9:53 am

I wonder how many people fell for this one? I could not figure out how this was going to help anyone, when all you were doing was getting another payment. Is this not what got us in trouble in the first place, with buying homes with high payments, that they could not pay for?
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attack-cat

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PostSubject: Re: The cash for clunkers catch!   Fri Aug 28, 2009 12:03 pm

I'm still wondering where the money came from to start with. I guess they just print what they need.
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speedy911911911

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Age : 54
Location : Alabama the Beautiful

PostSubject: Re: The cash for clunkers catch!   Fri Aug 28, 2009 1:56 pm

Have no fear folks...
"Hope and Change" will save us all! afro
Hooray!
cheers
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madcow

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PostSubject: Re: The cash for clunkers catch!   Sun Aug 30, 2009 1:41 am

If people wanted real changed they would have voted for Ron. Or even Cindy. But, oh no they wanted more of the same. Tranny And Taxes! I hope the sheeple are happy now.
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