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Senate committee passes bill extending trade-in credit window for vehicle sales to 60 days
Summary
House Bill 1377, which extends from 45 to 60 days the period a seller can claim a vehicle/trailer sales-tax offset after selling (rather than trading) a vehicle, passed the Revenue & Tax Committee after DFA explained insurance-settlement corner cases may require further legislation.
The Senate Revenue & Tax Committee approved House Bill 1377, which increases the credit window for vehicle and trailer sales from 45 to 60 days.
Senator Blake Johnson said the change simply gives taxpayers an additional 15 days to use the sale of a vehicle or trailer to offset tax on a replacement purchase when the vehicle is sold rather than traded. "It gives you another 15 days," he said, and the bill was described in testimony as having no fiscal impact.
Senators raised a question about whether the extension would apply if a vehicle is sold to an insurance company as part of a total-loss settlement. Paul Goering of DFA said that when a vehicle is sold to an insurer in satisfaction of a claim, the insurance carrier generally reimburses the sales tax as part of the settlement, and current rules do not permit claiming that sale as a credit against a future purchase because the carrier is reimbursing the tax. Goering said he would pull the relevant insurance regulation and provide it to the senator to ensure accuracy.
Members noted the situation could require additional legislation to reconcile total-loss settlements and sales-tax credit mechanics. A motion to pass received a second and the committee approved the bill by voice vote; the chair announced that Senator Blake Johnson's bill had passed.
The transcript records no roll-call tally. DFA indicated the issue could need further legislative clarification for insurance-related scenarios.
