HBarlow

This post is for my fellow TEXANs.

Early last summer when I realized what VWAG was offering to buy back my 2009 VW JSW TDI w/115k miles one of my considerations was the timing for purchase of a replacement car.

My state of Texas is one of the several states that charges sales tax only on net sales price on a car purchase when a trade-in is involved.

Most self-proclaimed experts will advise that to qualify for that sales tax reduction the trade-in must be part of the purchase transaction at the same time and same dealer.

I did a little searching online last summer and quickly realized that if I wanted to replace my faithful VW TDI with another TDI I would have to find a replacement quickly because TDI prices were rising and availability was declining.

I bought an Audi TDI in August from a dealer in St. Paul, MN and the earliest I was able to turn in my VW under the buy-back program was December 22nd a span of about four months.

I asked my rural county tax assessor-collector (who is a sharp lady) back in August when I registered the Audi and paid full sales tax about a sales tax refund. She advised that she thought the buy back was very similar to a lemon law buy back and advised me to submit a request for a partial sales tax refund to the Texas Comptrollers Office after the buy-back was completed.

I submitted the letter and completed form back in January. After providing additional details via email and several phone discussions with an agent in the comptroller's office I received a phone call this afternoon advising me that the legal and policy decision makers had made a determination in my favor and a check in the amount of $893.xx will be cut and mailed to me.

That amount represents 6.75% of the buy back check I received from VWAG last December.

So my point here is if you are a Texas resident who has sold back a 2.0 TDI VW or Audi or will sell back a 3.0 TDI VW, Audi, or Porsche and buy a replacement car the transaction has been determined by the Texas Comptrollers Office to be eligible for a sales tax exemption equal to the amount you received from VWAG for your buy-back TDI.

The exemption applies regardless of whether you bought a replacement car before, same day, or after you sold back your eligible TDI and it does not have to be done at the same dealer or even in the state of Texas to qualify. The key point is VWAG wanted your older TDI off the road enough to pay you for it and you required a replacement car.

See your county tax assessor-collector for the standard Texas Comptroller's Request for Sales Tax Refund or contact the comptrollers office. If you pm me I'll provide the name of my contact in the comptroller's office.

Be prepared for many "experts" possibly including your tax assessor-collector's office to tell you it can't be done. Many blowhards on the TDI website told me it couldn't be done. They are all wrong.

kkbma

Thank you thank you thank you! I have a 2010 Q7 TDI that they will be buying back this month. Haven't decided on the replacement I will buy, but this information is greatly appreciated!!

(despite my username, I am in TX now)

jetsfan101

Hbarlow, sent you a PM. Need your help on this.

kkbma

I ended up buying a vehicle the same day I handed in my Audi and the dealer said they couldn't treat it as a trade-in because they were a separate entity from the one buying back my Audi. I followed up with a call to the tax assessor and her answer was no.

HBarlow

The dealer spokesman is not well informed and the clerk in your tax assessor-collector's office is dead wrong. When I bought my Audi replacement for my VW TDI which was bought back later by VW I paid the full sales tax for the Audi and asked my county tax assessor-collector if it was not the same as a lemon law buyback. She agreed that she thought it was and advised me to wait until my VW was bought back and submit a standard TX Comptroller request for a partial refund of sales tax paid. It took a couple of months but the legal section at the comptroller determined it was. A woman member of this forum contacted me in late 2017 and she followed my advice and later pm'd me to say thanks, her refund request was also approved and received.

I have moved recently from Texas and still have unpacked boxes and don't have all my files. I looked several days ago to answer another forum member and I can't locate the VW TDI/Audi TDI file so can't give you the name of the woman at the comptroller's office who handled my transaction. I have also deleted some old Texas related computer files so don't have a name for you.

All I can tell you now is strictly follow the steps I explained almost two years ago and submit the package to the comptroller's office. The Texas comptroller's agency in Austin is a huge bureaucracy and probably has a hundred clerks with telephones and desks handling similar transactions so many probably are not fully trained or informed.

You might try calling Anna Rodriguez, Crosby County Tax Assessor-Collector in Crosbyton, TX 79322 and ask her for her advice. Crosby County is a small, rural county where county officials are not too important to talk with tax payers. Anna Rodriguez is very experienced, smart, and knowledgeable. She won't want to get into a peeing contest with another county official but she may answer your questions if you do your homework and know what you're talking about when/if you call.

I don't mind if anyone here uses my name and my case when arguing for your refund. My case was decided in early 2017, probably in March or April.

Harvey

jetsfan101

I recently went through the same process in Harris County, TX and Hbarlow was kind enough to help.

So initially when i filed the tax refund request i was denied. My mistake was that i asked for a tax refund on the NEW audi aka replacement vehicle. In Texas, the TDI buyback is seen as a lemon law situation so the taxes you are eligible to get back are taxes paid on the TDI vehicle. After that clarification was recognized, my claim was approved.

As my TDI buyback amount was more than what i paid for my TDI initially, i got a full tax refund. If the buyback wouldve been less than what i paid for my TDI, then it would've been a partial refund based on the value of the buyback settlement * 6.25%

Shoot me a PM if anyone has questions

HBarlow

As I read my original post and follow on posts almost two years later I realize that apparently I should have explained and emphasized the heart of the sales tax refund issue a little more clearly to prevent misunderstanding and confusion.

Here's the issue: Sales tax is collected on new vehicle purchases in most states. In Texas and some other states if a motor vehicle is exchanged at the same time a replacement vehicle is purchased sales tax is only collected on the "difference" which is purchase price of new vehicle minus trade in allowance on the old. Most citizens believe the two part transaction must be completed at the same dealership on the same date. That's a common misconception but it's not correct. The key element is a car which was previously taxed is traded is traded for another vehicle which is also taxed.

I believed that even though I bought an Audi TDI in August to serve as a replacement for my VW TDI which could not be sold back to VWAG until December the transaction was, in fact, a "trade in" and sales tax should only on be collected on the difference between purchase price of the Audi and trade allowance by VWAG on the VW. My county tax assessor - collector at the time is smart and an expert on tax law. She agreed with me. She advised me to submit a request for partial refund of sales tax paid after the VW buy back transaction was completed.

I submitted the standard Texas form along with the copies of both sale transactions and a document from VWAG identifying my VW TDI as included in the official buy-back and included a brief statement of my position. I argued that my Audi purchase in MN in August and VW buy back at a TX VW dealer in December was actually a "trade-in" regardless of time and distance separating the two and I should pay sales tax only on the difference. The Audi was purchased to replace the VW.

The TX comptroller's office reviewed my submission and agreed. I received a partial refund of the sales tax I paid on the Audi purchase. The refund I received was based on the purchase price (trade allowance) of the VW as if I had traded the VW for the Audi on the same date in December at the TX VW dealership.

Several other forum members have also received partial sales tax refunds. It's reasonable to assume that many others who have not identified themselves here have as well.