Here are the steps you need to follow to ensure proper sales tax payment:
Tennessee Dealer vs Out-of-State Dealer:
- If you purchase the car from a dealer in Tennessee, the dealer will collect the sales tax at the time of the purchase.
- If you purchase the car from a dealer outside of Tennessee (e.g., New York), you are responsible for paying the sales tax to the Tennessee Department of Revenue (TDR).
Vehicle Registration:
- When registering your vehicle in Tennessee, you must present proof of sales tax payment.
- If the sales tax was collected by a Tennessee dealer, they will provide you with the necessary documentation.
- If you purchased the vehicle from an out-of-state dealer, you must provide the TDR with proof of sales tax payment.
Tennessee Sales Tax Calculation:
- Tennessee's sales tax rate for vehicles is 7%.
- To calculate the sales tax due, you will need the purchase price of the car and the sales tax rate.
Paying the Sales Tax:
- You can pay the sales tax to the TDR in several ways:
- Online through the TDR website
- By mail (using Form R-1)
- In person at a TDR office
Penalties and Interest:
- Failure to pay the sales tax within the required time frame may result in penalties and interest charges.
- It's important to make the payment promptly to avoid any additional costs or complications.
Additional Information:
- If you have already registered your vehicle in New York and are now registering it in Tennessee, you may be eligible for a prorated refund of the sales tax paid in New York.
- Contact the New York Department of Taxation and Finance for more information.
By following these steps and paying the required sales tax, you can ensure compliance with Tennessee's laws and avoid any potential issues when registering your vehicle.
