Rhode Island Code of Regulations
Title 280 - Department of Revenue
Chapter 20 - Division of Taxation
Subchapter 70 - Sales and Use Tax
Part 28 - Motor Vehicle and Non-Motorized Vehicle Taxes (280-RICR-20-70-28)
Section 280-RICR-20-70-28.9 - Trade-In Deductions

Universal Citation: 280 RI Code of Rules 20 70 28.9

Current through September 18, 2024

A. R.I. Gen. Laws § 44-18-30(23) allows for a trade-in allowance on an automobile given by the buyer in trade to the seller of an automobile, towards the purchase of a new or used automobile. A motor home is treated as a private passenger vehicle which qualifies for the trade-in allowance.

1. EXAMPLE 1:

A customer purchases an automobile from a dealership and trades in an automobile to the dealer (seller). The trade in allowance is deducted from the sales price in determining the amount of the sale subject to tax.

2. EXAMPLE 2:

A customer purchases an automobile from a dealership and trades in a truck to the dealer (seller). A deduction for the trade allowance is not allowed from the sales price in determining the amount of the sale subject to tax, since the vehicle traded in is a truck.

3. EXAMPLE 3:

A customer purchases an automobile from a dealership and trades in an automobile to the dealer (seller). In addition, the customer receives a manufacturer's rebate on the purchase of the automobile. Both the trade in allowance and the amount the manufacturer's rebate are deducted from the sales price in determining the amount of the sale subject to tax.

Disclaimer: These regulations may not be the most recent version. Rhode Island may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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