When you buy a new car, you have to pay tax on it plus a title fee to get license plates. Some dealerships try to tack on extra costs, so you should know how to calculate your taxes and title fees on your own to avoid being swindled by unscrupulous dealers. When you buy a new car from a dealership, they will handle the paperwork, but you should look it over to be sure there aren’t any hidden fees. By being an educated consumer, you can make sure that you are only paying the necessary fees on your new car.
Look at the final, negotiated sales price of your new car. Ask the dealer about incentives. For example, if the state you live in taxes dealer incentives, you will have to pay tax on that extra money. If the incentive is $2,000 off the final purchase price, you still have to pay taxes on that $2,000.