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      12-28-2012, 06:44 PM   #1
gator4life108
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Tax on BMW purchased abroad

I'm shipping my car back to the states from Spain as I have been living here for almost 2 years. Had the vehicle registered here as well, but Colorado(my new duty station) is claiming I owe them sales tax for the vehicle to register it. Really? How can they claim sales tax on a vehicle not even purchased in the state and I'm not even a resident.

Anyone found ways around this? Seems a bit ridiculous to me.

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      12-28-2012, 11:53 PM   #2
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I don't want to suggest I have any expertise, but my cousin's husband shipped a car to the US after purchasing it abroad for use during his deployment in Europe and when he returned to the USA (Kentucky) he was told the 2 factors that determined his taxes were 1. Whether he owned the car 6+ months and 2. Whether he was active duty military. I'm assuming every state is different, though, and most states aren't very flexible in regard to taxes.
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      12-29-2012, 12:05 AM   #3
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Quote:
Originally Posted by gator4life108 View Post
I'm shipping my car back to the states from Spain as I have been living here for almost 2 years. Had the vehicle registered here as well, but Colorado(my new duty station) is claiming I owe them sales tax for the vehicle to register it. Really? How can they claim sales tax on a vehicle not even purchased in the state and I'm not even a resident.

Anyone found ways around this? Seems a bit ridiculous to me.
They can charge tax if you register the car. The way around this is to not register the car in Colorado. You say you are not a resident of Colorado. Where else do you have resident status and does that place have lower tax?

The other option is to not register it and drive it with a Spanish plate and an ESP sticker on the back. I think you can only do that for up to 6 months though and then the car has to be exported back home.
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      12-29-2012, 03:03 AM   #4
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I have heard of the 6 month rule as well.
When you buy a car normally in the states if you had it registered somewhere else (another state) prior to registering it in the new state you were excluded from sales taxes in the new state. I know some people go out of state to buy then bring it back where it is finally registered in their name and then owe taxes.

I technically have the car registered and have put miles on it so it is no longer used. I see no difference. I understand paying ownership taxes, but paying sales tax is another story. Even more so since sales tax will be $3,000 - $4000.

My resident state is Montana which has no sales tax, but requires the vehicle be brought to my home county to be inspected. This is really fine, but a last resort if I can't get around the Colorado problem. Colorado also requires residents including non-residents to have Colorado plates.
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      12-29-2012, 01:22 PM   #5
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As previously stated, each State is different. The States have these rules so people don't go to other States with lower tax rates to purchase their vehicles and then register them in the state they actually live in. A State will also normally waive sales tax if you can prove you paid it in your previous State.

Now, you should contact the titling department in Colorado and see if there is a specific time or mileage requirement that you have to own the car before you are waived from paying the sales tax. For example, it's 6 months here in Ohio. I had to park my new car in my new driveway for 4 months before getting Ohio plates put on it. I drove it on my German shipping plates for 2 months until the German registration ran out. Now, if I remember correctly Spain doesn't issue shipping plates, so you should be able to drive on your current plates (Euro) for as long as Colorado will let you (again contact them). Just be prepared to explain the story to the random peace officer.

Another thing to keep in mind is; more than likely if you don't outright own the vehicle, your new State will need to issue a title on the car. BMW will have issued a Certificate of Origin to the bank, so that will need to be sent to the titling office. Yet another loop to jump through, but a necessary one.

It's always bothered me how AAFES and the other "military sales" programs tout their vehicles as "tax free." These sales programs never explain that there is a definite chance you will be charged taxes if you haven't met your States mileage or time requirements. As military members sometimes it's a pain to deal with these issues, but we shouldn't expect special treatment because of the job we've chosen to do. Yes, it can be a pain in the ass, but normally there is a way around most of these issues.

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      12-29-2012, 01:31 PM   #6
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[quote=gator4life108;13222539]I technically have the car registered and have put miles on it so it is no longer used. I see no difference. I understand paying ownership taxes, but paying sales tax is another story. Even more so since sales tax will be $3,000 - $4000.
QUOTE]

It's never been registered or titled in the U.S., there's no "technically" about it. I know it sounds harsh, but it's the life we live. You'll work this issue out in the end.

Have you asked your sponsor if they can get more information about registering the vehicle? I would expect the MPs or SFs would have some information on the subject.

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      12-29-2012, 02:09 PM   #7
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You may want to ask here:

http://www.city-data.com/forum/colorado/

Seems like a very active forum. There are some very good discussions on vehicle registration on the site. Worst case it will help you with your decision on Colorado or Montana. Good luck.

State law information can be found here.

http://www.lexisnexis.com/hottopics/Colorado/

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      12-29-2012, 04:59 PM   #8
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Awesome. Exactly what I was looking for. I couldn't find the actual regulations before. Thank you, Bonus points to you.

I have the original Certificate of Origin as well. You are correct I have European/Spanish plates. As well I have the military registration paperwork to drive on the Euro plates. I was stationed in Colorado before and as far as military and registration is concerned they discount the ownership tax, but if the vehicle is purchased in state then sales taxes are due.

Did you ship through BMW or the government back to the states? Mine is going through the BMW home shipment program. That sucks your car had to sit. I have a bill of sale dated in August so we'll see.

This is what I could find concerning sales tax of vehicles purchased outside of Colorado per their regulations in the link you provided.

"(2) The following shall be exempt from taxation under the provisions of part 2 of this article:

(a) The storage, use, or consumption of a motor vehicle, if the owner is or was, at the time of purchase, a nonresident of Colorado and the owner purchased the vehicle outside of this state for use outside this state and actually so used it for a substantial and primary purpose for which it was acquired and the owner registered, titled, and licensed said motor vehicle outside of Colorado."
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      12-29-2012, 05:05 PM   #9
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I had to put at least 500 miles on the car to avoid import taxes through Customs in the states. You are absolutely right they advertise as tax free, but there are a lot of hoops to jump through to get to that.

Not looking for special treatment concerning taxes, just trying to make sure I know what may be due when trying to register.
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      01-01-2013, 08:29 PM   #10
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Quote:
Originally Posted by gator4life108 View Post
I had to put at least 500 miles on the car to avoid import taxes through Customs in the states. You are absolutely right they advertise as tax free, but there are a lot of hoops to jump through to get to that.

Not looking for special treatment concerning taxes, just trying to make sure I know what may be due when trying to register.
Good job on looking up the applicable laws. Looks like you have it handled now. I can understand you not wanting to pay taxes, but State laws have this way of throwing a big wrench in the process.

I shipped through BMW. The process was seamless for me, and you don't have to worry about the car being spotless. It took 4 weeks for my car to go from Frankfurt to Baltimore (including clearing customs). The military flew me into Baltimore (port of entry), I spent the night and then caught a cab to get my car and drove the 8 hours to Ohio. Worked out perfectly.

You will have to ship your car from Madrid if you use BMW Home Shipment. I'm not sure where you are going to ship to. Houston or Port Hueneme are probably the closest ports to Colorado. You may want to see if the military shipping points are closer for you. Also, if you ship through the military, pickup costs are reimbursable.

I've attached the Home Shipment pamphlet just in case you don't have a copy yet, hopefully it will help with your decision. If you have any other questions let me know.

edit: The last page of the Home Shipment pamphlet lists brokers for each port. For a fee these POCs can arrange vehicle release and truck shipment to your location.

Sean
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      01-02-2013, 05:34 AM   #11
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Cool. I shipped out the car through Madrid a couple of weeks ago. Going to Hueneme so I figure it will take a little longer. Thanks for the pointers. Let's hope I can have good luck getting it quick and seamless from the port like you did.
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      01-06-2013, 10:01 PM   #12
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I picked mine up in Hueneme. It was a piece of cake.
I was in the same spot as you with all the worries about paying sales tax before I got here. I brought two cars with me so that would've been BIG $$ down the drain. I searched the internet and called several times. I got different info each time I called. Until I actually bit the bullet and went to register at the DMV, the lady there informed me about an exlusion I qualified for and .... I didn't pay squat in sales tax here in California. For all the things I can tell you about how Cali sucks, this felt like it made up for all of it.
I'm a Texas resident and they will most definetly charge me sales tax. In fact, even now that I've already registered it stateside with Cali plates and own the title, TEXAS will still want proof of how much sales tax I paid here in Cali and charge me the difference in order to put Texas plates. The best part of the sales tax is that they base it off of the new purchase price and not what it's currently worth.
I think to save $3~4K it would be worth the drive to Montana for you and get some home cooking while you're at it. Welcome back stateside!
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      01-06-2013, 10:51 PM   #13
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Thanks for helping clear things up and making this sound better. Did you get your Euro plates back and have the ability to drive on the military registration?
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      01-08-2013, 06:50 PM   #14
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I was stationed in Italy for 5 years and I was going to use the military purchase program BMW has. My dealer told me when I was there, that I had to have the car for 6+ months unless I would owe taxes on it when I came back to the states.
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