If you don’t see your question in the list below simply give us a call at 1.888.464.8265 or send us an email and a representative will assist you.
You will need to pay Federal Excise Tax (FET), which amounts to 12% of the price and must be collected and paid by the seller, similar to sales tax. In general, FET is due on the first retail sale of vehicles over 26,000 pounds GVWR. There are some exceptions:
- If you can document that you are registered to collect FET and that your purchase is for re-sale, the trailer manufacturer may not be required to collect FET. However you will. See your tax advisor for more advice.
- State and local government agencies are exempt, but federal government agencies are not.
- Vehicles that are not for use in the United States are exempt.
The tax generally applies to the price of a part or accessory and its installation if the following conditions are met.
• The owner, lessee, or operator of any vehicle that contains a taxable article installs any part or accessory on the vehicle.
• The installation occurs within 6 months after the vehicle is first placed in service.
The owners of the trade or business installing the parts or accessories are secondarily liable for the tax.
A vehicle is placed in service on the date the owner takes actual possession of the vehicle. This date is established by a signed delivery ticket or other comparable document indicating delivery to and acceptance by the owner.
The tax doesn’t apply if the installed part or accessory is a replacement part or accessory. The tax also doesn’t apply if the total price of the parts and accessories, including installation charges, during the 6-month period is $1,000 or less. However, if the total price is more than $1,000, the tax applies to the cost of all parts and accessories (and installation charges) during that period.