Quote:
Originally Posted by nicknaz
I believe this reduces your tax burden each month too because the Chicago tax is based on the monthly payment.
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IL charges the financing company full sales tax -- the logic (???) is that the finance company buys the car, therefore they should pay sales tax. The finance company then turns around and wants to be re-imbursed for the sales tax by the lessee (= driver). I typically pay a prepayment (down payment) of all one time fees, including the sales tax. I see no reason splitting these fees up by 36 months (or whatever lease duration) and paying interest on top of that.
On a side note, if the driver decides to buy the car out, IL comes along and charges sales tax again ... this time, they charge the driver directly (albeit "only" on the residual as far as I know).
I know Chicago charges an additional tax, just not sure if it's on the payment only or on the whole car or ...