Do You Pay Tax on Price Before Instant Rebate or After Rebate Deducted? (1 Viewer)

[Arthur S]

I passed up a deal on a Moto Razr that had a $250 Instant rebate. I figured that I would have to pay tax on the full $300 price of the phone.

Someone else said I would not pay sales tax on the $250 because it was "instant".

Which is correct?

Thanks

 

[Bill_D]

In my experiences, I was taxed after the instant rebate. I believe instant rebates are handled just like discounts.

 

[Christ Reynolds]

tax on $300 isnt THAT much, is it? here in MA, it would be $15.

CJ

 

[Carlo_M]

In my experience, instant rebate is taxed post-rebate (as Bill says, just like a discount). Mail-in rebates you are taxed the purchase price.

 

[Mark Philp]

It depends on what state you're in.

 

[JohnRice]

The term "Instant Rebate" is just marketing BS. There is no rebate. It's just a sale price. You pay tax on the purchase amount, which is after the "rebate". In fact, it should be illegal (tax fraud) to charge sales tax on the higher price.

 

[Chris Lockwood]

JohnRice has the best answer so far.

BTW, around here if you buy something with a manufacturer's coupon, you pay tax on the price before the coupon is subtracted.