Personal use of used vehicles taxable
Used vehicle dealers who provide used cars to their sales staff or managers for personal use without charge are subject to use tax.
How is the use tax computed?
The tax is due on one vehicle per year for each sales person or manager who uses one.
How to determine the value
The value for use tax reporting is the average selling price of all used vehicles sold in the preceding year multiplied by 25 percent.
When is the use tax due?
The use tax is due in the month in which the vehicle is first used for personal use.
New vehicle dealers
New vehicle dealers will also pay tax in this manner for used cars furnished to sales staff or manager, BUT ONLY IF NO NEW CARS ARE PROVIDED during the course of the year to the manager or sales person.
New and used cars provided
If both new and used cars are provided by a new vehicle dealer to a manager or sales person, use tax liability is figured as described in the sections Demonstrator Use of Vehicles and Executive Vehicles.
Used car dealer - new car
Purchase of a new car by a used car dealer and used personally by the dealer or person associated with the dealer is subject to retail sales tax at the time of purchase.