$1K rebates and Processing fees State of MD. taxable?

A local Toyoto dealer says he must include "processing fees" and the official Toyota $1000 rebate on 2008's Hybrids on the taxes for MD. which are 6%.

I doubt that services (processing fees) and reductions in Price (rebates) are taxable.

I cannot find anything when I try to "google" this question.

Any comments???

Reply to
Ritter 197
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You can always call MD Tax Board to ask. Usually the discount is taken off before anything else is applied, otherwise if you negotiate a lower price from sticker is the difference taxable too? So I think your dealer is full of it.

2008 is forecast to be a slow year for auto sales. Tell your dealer to lower the price some more.

Reply to
johngdole

AFAIK, processing fees are not required by MD law. If they don't appear on the sales contract, no tax.

AFAIK, a rebate is applied AFTER the final sales price is calculated. Hence, you pay taxes on full sales amount prior to rebate. A rebate returns part of your payment; it is done after a sale. A discount is different, as that is done prior to the sale and decreases the sales price and taxes.

Reply to
ACAR

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