Yogi1956
Well-Known Member
- First Name
- George
- Joined
- Apr 25, 2021
- Threads
- 9
- Messages
- 273
- Reaction score
- 498
- Location
- Hidden Meadows
- Vehicle(s)
- 2021 Rubicon Unlimited
The problem is you are trying to sell a Jeep that sells new for $63k-7.5$ tax credit for $63k. Post it up for $55-56 and it will probably sell. Your plan to pocket that $7500 as profit is probably not going to work.
Just want to clarify that this is only kind of true, if you don't use the tax definition of 'owe'. If the amount you 'owe to the government end of year' and the amount that you've already paid in the form of income taxes is greater than 7500, you get the full amount of the credit.
Nonrefundable vs refundable credits refers to the government giving you back more money that you've paid in federal income taxes all year (refundable) or not (nonrefundable).
A scenario where the refundable vs nonrefundable matters would be a person on a fixed or low income (sub 60k per year) who purchases a 4xe with pre-existing, non income funds, a horrendous financing rate or an underwriter asleep at the wheel. They would not be able to receive the full 7500, because they do not pay at least 7500 in federal income taxes. They would still receive up to the full amount of their actual federal income tax as a refund though, it would just not get to the full 7500.
low incomeJust want to clarify that this is only kind of true, if you don't use the tax definition of 'owe'. If the amount you 'owe to the government end of year' and the amount that you've already paid in the form of income taxes is greater than 7500, you get the full amount of the credit.
Nonrefundable vs refundable credits refers to the government giving you back more money that you've paid in federal income taxes all year (refundable) or not (nonrefundable).
A scenario where the refundable vs nonrefundable matters would be a person on a fixed or low income (sub 60k per year) who purchases a 4xe with pre-existing, non income funds, a horrendous financing rate or an underwriter asleep at the wheel. They would not be able to receive the full 7500, because they do not pay at least 7500 in federal income taxes. They would still receive up to the full amount of their actual federal income tax as a refund though, it would just not get to the full 7500.
Part of the problem is that many people have no idea what they actually got for their trade…. This is especially true when the dealer is providing financing. Dealers routinely inflate the trade price shown to make the buyer feel better about the deal, but the money is made up from other profit centers, like margin in the new vehicle, financing kickbacks, and factory to dealer rebates, “advertising support”, and other incentives. That’s why I stopped trading years ago. I sell my used vehicle, often via consignment, and buy the new one. This saves a TON of money and leaves me knowing what I actually paid.
These are strange times because of the unique supply and demand balance, so people have gotten crazy high prices for used vehicles, but that doesn’t equate to being able to sell your used vehicle for a crazy price when similar new vehicles are available within two or three months, or sooner.
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So true, once a dealer gives you a “trade in” number, tell them to buy it on the spot for the number and you promise to come back tomorrow and buy the new one.
The only reason to trade in is if you don’t have the time to sell it on your own if a dealer actually put the true number on your contract most buyers wouldn’t do the deal.
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