Open Today! 8:00 AM - 6:00 PM
Open Today! 8:00 AM - 6:00 PM
3941 Mike Smith Dr Paducah, KY 42001
Home of the Nationwide Lifetime Warranty
3941 Mike Smith Dr, Paducah, KY 42001
Sales/Service/Parts: (270) 408-6453 Toll Free: (800)444-8609

Get The Facts On The 2020 Illinois Tax Change

On Jan. 1, 2020 the Leveling The Playing Field For Illinois Retail Act takes effect – and it will cost you hundreds of dollars, if not thousands. In a nutshell, this new law caps the tax credit you get when you trade in any vehicle at $10,000.

What does this mean? Right now, when you trade in any vehicle, you get a tax credit for the full amount of whatever the dealer gives you for the vehicle. You don’t pay a sales tax on that amount. You only pay a sales tax on the difference. But, starting Jan. 1, 2020, this new law states that you can only get a tax credit up to $10,000 and no more.

In other words, if you get a $20,000 trade-in allowance on a $47,000 vehicle, you only pay taxes on the $27,000 difference. Starting Jan. 1, 2020, the state-imposed cap of $10,000 kicks in, which means that you would pay taxes on $37,000.

By December 31st

Price: $47,000

Trade-In Tax Credit: $30,000

Taxable Amount: $17,000

State + Local Tax: 6.25%

Sales Tax: $1,062.50

SAVING
DIFFERENCE

$1,250

After January 1

Price: $47,000

Trade-In Tax Credit: $10,000

Taxable Amount: $37,000

State + Local Tax: 6.25%

Sales Tax: $2,312.50

And that law applies regardless of how much the dealer gives you for your trade. Imagine, you’re trading an almost new Ford truck and the dealer tells you that you’ll get $30,000 for your trade. Well, right now, you don’t pay a cent of sales tax on that $30,000. But after Jan. 1, 2020, you’ll pay tax on $20,000 of that $30,000 because there’s a cap of $10,000.

Let’s Repeal The Law

It may be a long shot, but if enough people lodge a complaint against this law, there’s a chance it could be repealed.

The Illinois Automobile Dealers Association is actively lobbying to make this happen. And they could use your help. Visit IllinoisDealers.com to find out more information on how together we can stop this law from affecting YOUR pocket.

Play It Safe & Trade Today

If you’ve been thinking of getting a new vehicle next year, don’t wait or you’ll lose a lot of money. Get to any of our 5 Coad dealerships and trade in your car before Jan. 1, 2020.

AdChoices Text Us Text Us