Hello all, I am considering purchase of a new 12 ton trailer and I am having a hard time getting an answer to this question from several trailer dealers in my area. I am from Connecticut. Some dealers are telling me I will have to pay the federal F.E.T. tax because the trailer gvw is over 26K which I fully understand, just as it is with a truck over 33K. But some are telling me that I will also pay state sales tax as well as F.E.T. Now I called the state DMV and to no surprise the first two I spoke to didn't even understand what I was asking them. The third told me no, you pay 1 or the other but she wasn't (100%) sure. Really?? So.... has anyone recently been in my position and can help me out with this, thanks
You just pay the FET....12% so its kinda like paying both anyway
Unless you can register the trailer for farm use, then you are exempt from FET. I assume that is not an option for you.
My understanding is that you pay the FET and state sales tax. They are independent of each other. Farm use does not exempt you from FET according to my past dealings with the IRS. FWIW- The IRS uses a different formula to determine if FET applies, that takes into account axle size & placement, rather than the GVWR assigned by the manufacturer. Quality mfg that belong to the NATM know about this. You should be able to contact the trailer's mfg. and ask if it falls under FET requirements. My understanding is the IRS audits mfg to see which trailers required FET, and they have been known to follow it through the dealer to verify tax was collected. As a dealer, I have been through an IRS FET audit before- not fun.
You MUST pay 12% FET if the trailer rating is over a 26,000# G.V.W.R. period. The only way out of that is if it will be registered outside of the U.S. It only has to be payed 1 time which is usually when new. If a trailer was sent outside the U.S. when new and then is resold and comes back to the U.S. years later you still must pay the FET on the purchase price of the trailer. Also FET and sales tax are 2 different taxes. If you are not sales tax exempt then you must paye both FET and sales tax on the purchase price. You must make sure they taxes are calculated separate. I sell many new trailers every year and have to collect and turn in millions of dollars to the government the tax money. The selling dealer is responsible in doing that. I have been audited by the FET department before, so I know all of this first hand. Justin