Started to wonder if I could trade in my model S get the solar roof and save the sales tax since Tesla owns solar city now should work ?
You can ask but very unlikely. Trade-ins are those, trading one thing (a car) in for partial credit towRds a like thing (another car).
Yeah I was thinking it would be like a credit basically so no tax kind of a unique situation with Tesla
Not really. Lots of companies make multiple products in different industries. Mitsubishi makes cars and airplanes and generators and ships and, and, and.... Honda makes cars and planes and lawnmowers and generators and motorcycles.
You can't go to those companies and trade in one product for a product in a completely different product line and I wouldn't expect Tesla to do it either. At the end of the day, Tesla isn't in the used-car business. The only reason they take trade-ins (and the values are really low) is as a convenience for a person buying a new car from them.
Yeah that's a good point
And if they did take the car as payment, it would not save any sales tax.
If the solar is $100 and the car is worth $50 and the tax is 5%:
Payment: $50 (car) $55 (cash)
Tax does not depend on whether you pay them with goods, services, or cash.
Not quite. In some states, a trade-in value reduces the sales tax. Basically cost of new car minus value of trade in equals purchase value and that is the number that is taxed instead of the cost of the new car. I believe this is the case in California (but am not sure).
Arizona reduces the tax by the trade-in amount.
Drklain is correct. I only paid salea tax in WA for model S #2 on the difference between price and trade in value, because the sales tax- technically, on a car, a USE tax- was consideded as havi g been paid already on the portion that was embodied in the trade in vehicle.
Kind of funny because Model S #1 was not liable to sales tax at all under the now-expired WA EV incentive!
Trading in a car for another car is different than using a car to pay for something else, like a solar roof. No state that I am aware of offers a sales/use tax break for using a car (or other good or service) to pay for something.
I think it's pretty clear that no one is going to be able to trade in a car for some other product produced by the company.
But if the company did, it would not reduce the sales tax.