Car sales tax and out-the-door price.

Worked example

A $30,000 car with a $1,000 rebate has a negotiated price of $29,000.00. Fees are $500 taxable and $200 non-taxable, the tax rate you type is 8%, and your trade-in is worth $10,000. If tax is charged on the price minus the trade-in, the taxable amount is $29,500 - $10,000 = $19,500.00, tax is $1,560.00, and the out-the-door price is $31,260.00. After the $10,000 trade-in you owe $21,260.00, and $19,260.00 after a $2,000 down payment. If tax is instead charged on the full price, tax is $2,360.00 and the out-the-door price $32,060.00, which is $800.00 more; that is the tax saved by the trade-in credit.

How it works

Negotiated price = price - discount. Taxable amount = negotiated price + taxable fees, minus the trade-in value if tax is charged on the net (never below zero). Tax = taxable amount x rate. Out-the-door price = negotiated price + taxable fees + non-taxable fees + tax. Due after trade-in = out-the-door price - trade-in value. To finance = that amount minus cash down.

The FTC defines the “out-the-door” price as the total price of the car before financing, including taxes and fees, and advises getting it in writing before you talk financing so you can compare offers and catch extra charges. This tool does not know your local rules; if you owe money on the trade-in, the payoff is not handled here, so see the negative equity calculator.

Sources and basis (opened 2026-10-08): Federal Trade Commission, Consumer Advice, “Financing or Leasing a Car”. Statements used: the definition of the out-the-door price and the advice to get it in writing. Tax rates and trade-in tax rules come from you, not from this page.

Not financial advice. This is a planning estimate from the numbers you type. Taxes, fees, insurance and lender or lessor terms vary; confirm every figure against your contract or written quote.

FAQ

What is the out-the-door price of a car?

It is the total price of the car before financing, including taxes and fees, according to the FTC. It is the number to compare between dealers, rather than the sticker price or the monthly payment.

Is car sales tax charged on the full price or after the trade-in?

It depends on where you buy. Some places charge tax on the price minus the trade-in; others tax the full price. Choose the option that matches your written quote. The tool does not assume either.

Are dealer fees taxed?

That varies too. Put taxable fees in the first box and non-taxable fees (like plates) in the second, matching your quote.

How much tax will I pay on a car?

Taxable amount times your rate. In the example, 8% of $19,500 is $1,560 with a trade-in credit, or $2,360 on the full $29,500 without it. Type your own rate and amounts.

Does this include financing costs?

No. The out-the-door price excludes financing. To see payments and interest, use the auto loan calculator or the down payment calculator.