home home Questions & answers home Question Question
Enter keyword(s):   
Browse By Category Advanced Search

Q:  What about credits, trade-ins, and exemptions for use tax?


When you bring goods into Washington that you purchased in another state or country, you can receive a credit for the sales tax or use tax you paid to another state, local government, or country by subtracting the amount of sales tax you paid from the amount you owe. However, you must have proof, such as an invoice or bill of sale, that the tax was paid in the other state. Please note that Canada's goods and services tax (GST) is not a sales or use tax and may not be used as a credit against Washington's use tax.

If you trade-in a like item to reduce the amount you pay for a new item, use tax is due on the difference in purchase price. For example, you purchase a car in another state with a purchase price of $20,000. The dealer accepts your current car as a trade-in valued at $5,000. Therefore, you owe Washington use tax on $15,000.

NOTE: If the dealer gives you $3,000 cash instead of subtracting that amount from the new car price, then you have not traded-in your vehicle and use tax is due on the full $20,000.

Persons who are residents of another state and move to Washington are exempt from use tax on their household goods, personal effects, and motor vehicles if they acquired the property more than 90 days prior to moving to Washington.

Boats, motor homes, trailers, and other recreation vehicle equipment do not qualify as motor vehicles or personal effects. These items are subject to use tax, even if acquired more than 90 days prior to moving to Washington. A credit in the amount of tax paid on the item can be used to offset the amount of Washington use tax owed. Proof of previously paid tax must be provided.

More information
Washington Administrative Code (WAC) 458-20-178
Revised Code of Washington (RCW) 82.12
Related questions & answers
Do I owe use tax on Internet purchases?
How well did this answer your question?
 5 - Very well
 1 - Not at all