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Discussion Starter · #1 ·
I would like to warn everyone on the board not to buy or lease from Simpson Chevrolet. They have been leasing cars to customers with the promise of the Federal tax rebate. I would like to make sure that anyone who is leasing knows they will go through a painful audit if they try to file for the Federal Tax credit. The sales staff and management at Simpson has been repeatedly telling me, the Volt team and my tax consultant that I would receive the credit. I finally called Ally and had some foreign offshore rep tell me that they get the credit (the American Office wouldn't answer anything). Simpson is trying the tell the Volt Team the credit is rolled back into my payment, which is a complete lie. I am moving this further on up the ladder at Chevrolet and starting litigation with Simpson. Please warn anyone looking to buy or lease not to deal with these crooks. I will be posting on Yelp, Google reviews, Yahoo and reporting them to the BBB. The digital age isn't a good time to treat customers like this.

PS. I do love that car though
 

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You do understand that the federal tax credit does go to the leasing company right? That is part of the reason the lease is so reasonable. That dealership telling you that YOU'LL get the tax credit is completely wrong though.
 

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The sales staff and management at Simpson has been repeatedly telling me, the Volt team and my tax consultant that I would receive the credit. ... Simpson is trying the tell the Volt Team the credit is rolled back into my payment, which is a complete lie.
That is odd -- they seem to both be saying that you get the credit directly, and that Ally will somehow credit it to you. The Form 8936 clearly states "You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit;", so your tax consultant should easily understand the issue (*unless* you stated to him that you qualify, based on what you heard from the dealer).

As for Ally, they get 100% of the tax credit (assuming they can use it), and can pass any amount on to you that they want to, either directly ("Here's a $7,500 (or other amount) allowance since we get the tax credit") or indirectly (through better terms).

But, it doesn't just get "rolled back" into payments; by leasing, you spend perhaps $15,000 or so in payments, so you shouldn't really be entitled to the full $7,500 (in other words, if the tax credit was $15,000 instead of $7,500, you could lease the car for free if the full tax credit was applied to your lease).
 

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What?!? A car salesman mis-representing? My apologies to all car salesmen! lol

Seriously though this is really really simple. The purchaser get the tax credit. When you lease you are renting not buying so you are NOT the purchaser. When you rent an apartment or a house do you pay the property tax? No the owner of the real estate does. When you lease do you pay the sales tax? Uh, this is where it does get complicated. Technically no you dont the purchaser does but varying state laws have decided to say that the lessor does indeed pay the sales tax as part of their lease payment in some states. Why complicate things? Because in some states sales tax paid is deductible.
 

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"so your tax consultant should easily understand the issue (*unless* you stated to him that you qualify, based on what you heard from the dealer)."

And if this is the case find a different tax consultant! Your tax consultant shouldn't be consulting you....
 

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Unless you have something in writing saying otherwise, I'd imagine they would just say they told you you get the tax credit benefit, they apply it to reduce the cost calculation. If it's not in writing it didn't happen....

Best of luck

MrEnergyCzar
 

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Probably nothing will stick (ie. you need proof - that being something in writing or a tape-recording of the discussion with them).

If they do have something in writing then it truly is trouble and misrepresents the tax situation in order to sell a product.

It would be like a real estate agent taking a buyer to closing saying "this property does not have taxes on it" and then the buyer eventually getting the bill. The buyer should check with the township or county before buying. If it is public knowledge to situation <a> and they say <b> in order to make a sale, that is something that, if provable, is business fraud. Same for the Volt - an EV buyer should *know* the tax liability implications before stepping into the showroom. Unless the sales dealer swayed someone from a Cruze "up to" a Volt saying "you can lease *and* get a tax refund if you buy this."
 

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When Leasing, Ally bank was giving around a $5,000 dollar cap reduction from the $7,500 tax credit they received. They did not, or still are not giving 100% of the tax credit of $7500 back to the Leaser of the Volt. But $5,000 is decent enough of a cap reduction.

To get a full $7,500 tax credit, not only do you have to buy the car instead of leasing, BUT you also have to have $7,500 tax liablity left after all yout tax credits, like mortage interest, et al. If you on;y have $4,000 left over, you only would get $4,000 tax credit, AND it does not roll over the difference of $3,500 for the next tax year.
 

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Kind of puts me in the mind of the late great John Retsek of "The Car Show" on KPFK in L.A. They were talikng one day about how the car buying experience had seemed to get a little less unpleasant in recent years. He famously said "Don't worry, the guy in the plaid sport coat, white belt and shoes, and polyester pants didn't leave the dealership." "He just moved to the leasing office."
 

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Caveat emptor, but of course some of the credit to Ally is rolled back into the lease. Ally (nee GMAC) gets the tax credit. In turn they provide a loan for the lease that considers their overall anticipated cost..mainly the ADJUSTED resale value at lease end (residual) subtracted from the deal you negotiate with the dealer. The residual is adjusted with some portion of THEIR tax credit. then loan number is adjusted for a money factor (interest) and that is your lease payment spread over the lease term. Obviously, the lease can be negotiated as a single payment up front with less interest paid or spread out over the term. The point is that residual is adjusted by Ally because of the rebate...so it does contribute to lowering your lease payment...but not as a distinct amount...

The real variability comes from the dealer. Very high volume dealers with hundreds of Volts in their pipeline get hidden rebates that other dealers don't get. They can knock more off the MSRP. They also are more likely to have well trained and experienced shop techs.

Finally, inventories are low. Don't expect one of the give away leases from last summer.

The upshot is always negotiate with more than one dealer, and pay close attention to "specials" or national deals as indicative of real cost structures. Don't blow your cool, its all about negotiating.
 

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I find that dealers are typically clueless about this kind of stuff. They just want to make a sale......

I knew exactly where I stood on the tax break before I walked in the dealership..........
 

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Discussion Starter · #12 ·
correction

Sorry, I meant the reason you will get audited is because Ally takes the rebate. Ally is not applying the rebate to the car sale, it would show up in the lease agreement like it did when US Bank was applying the rebate. I was going to buy the car, but after I was told about the Fed Credit is going to the lessee (which is untrue) I decided to lease. I wouldn't have thought they would rather have you lease than make a sale. Live and learn. Just sending a warning to everyone. Thanks
 

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I find that dealers are typically clueless about this kind of stuff. They just want to make a sale......
True. But in most high-dollar disputes, there isn't a problem. For example, if a salesman says "Yeah, that $2,000 GM rebate will still be valid next week" (of course they would never say THAT, as you wouldn't buy today, but...), then if the rebate goes away, you haven't bought the car, so you aren't very likely to sue them over it.

This, however, is very different, in that it is high dollar ($7,500), the salesman made a promise out of a lie, and it is one that sticks after the sale.

And for those that aren't aware, I believe that legally in the U.S. a verbal statement is as legally binding as a written statement, just nearly impossible to prove.
 

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Please folks who would believe anything a car salesman said without investigating it yourself. Its like asking a thief to hold your wallet and assuming when you come back your money and wallet will still be there.......
 

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Discussion Starter · #15 ·
Very true

The great part is that the sales person texted me the information about the tax rebate. I also received an email from Simpson stating I "would" receive a tax rebate. Even if I get 0$ and the lawyer gets everything, it would probably be worth suing. Alright, I will now make Volt positive posts after this. Thank you for listening
 

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I find that dealers are typically clueless about this kind of stuff. They just want to make a sale......

I knew exactly where I stood on the tax break before I walked in the dealership..........
With all due respect, is it the dealerships job to inform you about tax issues? We sell cars, we're not tax accountant's. Would you go to a dentist to get heart surgery? You should do your own research as to what you do and don't qualify for.
 

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With all due respect, is it the dealerships job to inform you about tax issues? We sell cars, we're not tax accountant's. Would you go to a dentist to get heart surgery? You should do your own research as to what you do and don't qualify for.
With all due respect, if that's the case, the dealer should say "I don't know, you should consult your accountant," not provide incorrect advice with confidence in order to make a sale.
 
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