illinois tax issue on rv trade in for car?

westernrvparkowner wrote:

dodge guy wrote:
A trade in is a trade in! the amount is deducted from the sale price.

That is not true in most states. If you were to trade a refrigerator or your dog you would not get any tax consideration. In many states, the trade must be licensed as a motor vehicle to qualify for tax treatment. That would leave out things like boats, travel trailers etc. In other states, how the vehicle was titled is key. It would have to have been titled in your name to qualify. This was a big issue in Texas since leased vehicles are registered in the lessor's name. You couldn't legally trade a leased vehicle in and pay taxes only on the difference unless you traded it for another vehicle leased through the same bank. Tax law is always more complicated than it seems. Why do you think there are hundreds of thousands of people working for the IRS and state departments of revenue and an equal number of tax accountants, tax preparers, tax attorneys and the like?

I should clarify that the trade in tax allowance is deducted from the tax on the new car. At least that's how it is/was in IL.

This is why I buy used from a private party. Depending on the year, no matter the selling price you pay a tax by the year of the car. I do believe that newer cars will go by the selling price.