How to Calculate Washington Car Tax

October 30, 2013

Whether you live in Seattle, Olympia or Vancouver, paying Washington car tax is an unavoidable expense. The state of Washington taxes all sales of automobiles at a rate of 6.5 percent, which is the standard retail sales tax. In addition, Washington county taxes are applied as well at a rate of 0.3 percent of the sales price.The tax money collected is allocated toward various state funded services like road maintenance. Even if you purchase your vehicle in the neighboring state of Oregon which has no sales tax, Washington sales tax still applies and must be paid when you register your vehicle.

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When you buy a car from an auto dealer, the amount of tax you pay is automatically calculated (for both state and county tax) and included in the overall sticker price. Dealers are required to list this amount on the window sticker.

Purchasing vehicles from a private party are not immune to Washington state auto tax. Washington has a mandatory "use tax" that is assessed to you when you register your vehicle at the DMV and ownership is transferred from the previous owner to you. The tax amount is based upon the value of the vehicle at the time of purchase, and is the same retail sales tax of 6.5%. In the case where a vehicle is purchased more than $2,000 below the fair market value of the vehicle (determined by pricing guides like Kelley Blue Book), the state will assess the tax you owe on the average fair market value unless you can prove to the state that the purchased vehicle is worth less. A downloadable guide to calculating use tax (Use Tax Facts for Vehicle Transactions) can be accessed here: http://dor.wa.gov/docs/Pubs/ExciseTax/RetailSales_UseTax/UseTaxFactsforVehicleTransactions.pdf.

Use the following link to the Revenue Department's Washington car tax calculator where you can plug in your Washington address (to which you would register your car) and the purchase price of you car to get the tax amount you will be assessed: http://dor.wa.gov/content/findtaxesandrates/salesandusetaxrates/lookupataxrate/.

More information can be found at the Washington State Department of Revenue's website.

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