Buyback - Use Money to Buy Any Car?

CoryS

Veteran Member
Joined
Dec 28, 2005
Location
PA
TDI
2017 Jetta 1.4T
I was patiently awaiting the cash until several months passed and still no fix for my (2009) car so a bulb went off and am in the final step of the Buyback. For some reason I was under the impression that it was sort of a trade plus cash for a new VW, but during the process it seems as though I bring the car to a VW dealership and the "buyback" cash goes into my personal account to do with whatever I wish.
Is that the case? Either way, I think I'm 1.4T Jetta-bound, but just wondering.
This has likely been addressed hundreds of times already, but I'm a little slow.
Thanks.
 

VWMark

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Apr 8, 2003
Location
Mount Kisco, NY
TDI
2010 Golf TDI 6M RIP, 2015 GSW SE TDI 6M, 2015 Q7 TDI
Correct, the buyback has nothing to do with buying another VW. You give them the car, they give you the full buyback amount(unless there is a loan of course).
 

k1xv

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Location
southern Vermont
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09 TDI sedan, sold back 12/16. Present cars 2013 BMW X5 diesel, 2015 Corvette convertible
You are selling back your car, not trading it. Heck, you could use the money anywhere cash is accepted for anything your heart desires. Even a standby ticket on United Airlines.
 

Armby

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Nov 30, 2012
Location
Ottawa, Canada
TDI
2013 Golf
In Canada we do have the option of trading our TDI in for a new VW and thereby getting the advantage of not paying sales tax on the trade-in value of the car. I am not quite sure how VW pulled this off. Having the sales tax credit is great for those that want another VW but VW is using a government sales tax credit to tip the scale in favour of VW. Didn't cost VW anything, it came out of gov't revenues.
 

DieselMann99

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Location
Westchester County NY
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2013 Jetta TDI w/ Premium, DSG (Buyback Nov 2018); 2013 Jetta TDI (bought Dec 2018); also, bought a CPO 2017 Passat TSI (Nov 2018)
In Canada we do have the option of trading our TDI in for a new VW and thereby getting the advantage of not paying sales tax on the trade-in value of the car. I am not quite sure how VW pulled this off. Having the sales tax credit is great for those that want another VW but VW is using a government sales tax credit to tip the scale in favour of VW. Didn't cost VW anything, it came out of gov't revenues.
Which makes me question why VW can't do the same thing here in the USA. It's a state-by-state tax law matter, so it wouldn't apply nationally, but most states do let you use the trade-in value to reduce your sales tax liability on the new car.
 

Armby

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Ottawa, Canada
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Which makes me question why VW can't do the same thing here in the USA. It's a state-by-state tax law matter, so it wouldn't apply nationally, but most states do let you use the trade-in value to reduce your sales tax liability on the new car.
I believe ine the US the FTC would not allow VW that advantage (having a sales tax credit only if traded in for another VW).

What should have happened in the US and Canada is allowing a trade-in to occur at any dealer, after the appropriate inspection by the claims administrator of course. Then the dealer returns the car to VW to collect the trade-in value. I know, probably too complicated, but it would have been fair at least.

In Canada I get the impression that most people are just going for the VW replacement. Nice deal for VW Canada. Almost a forced premature update to a brand new VW paid for by the owners and a sales tax credit with only a slightly above market value buy-back incentive.
 

Rico567

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Jun 13, 2003
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Central IL
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2013 Passat TDI SEL Premium (Turned in 7/7/18)
Which makes me question why VW can't do the same thing here in the USA. It's a state-by-state tax law matter, so it wouldn't apply nationally, but most states do let you use the trade-in value to reduce your sales tax liability on the new car.
{NB: Obviously, nothing in the following post is intended to apply to anything existing in the Canadian settlement, since I am responding to a U.S. contributor. And I don't care to address whether or not anything that happens in Canada's settlement ought or ought not to be in the U.S. settlement. We've got our settlement, and it ain't gonna change.}

You give -parts of- the answer to why it can't / didn't happen in your post. I might add:

1. The CAS settlement was a federal matter, nothing to do with the states, except insofar as if a state participates in the settlement, they must register existing Dieselgatemobiles (45 have done so).

2. Sales tax is a state matter, and varies from state to state. Therefore, no state has any possible incentive to waive the sales tax.

3. The buyback is not a trade-in. (and this has been reiterated numerous times elsewhere in this forum).

4. Solution: be living in a state with no sales tax, or be living in VT, which has some provision in the state sales tax code that allows the tax to be refunded (or waived, or something). Otherwise, you're going to pay sales tax, as I am here in IL, and I've concentrated on things that can profit me, like hanging onto this Passat until the end of next year, which is of significant value.
 
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DieselMann99

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Westchester County NY
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2013 Jetta TDI w/ Premium, DSG (Buyback Nov 2018); 2013 Jetta TDI (bought Dec 2018); also, bought a CPO 2017 Passat TSI (Nov 2018)
2. Sales tax is a state matter, and varies from state to state. Therefore, no state has any possible incentive to waive the sales tax.

3. The buyback is not a trade-in. (and this has been reiterated numerous times elsewhere in this forum).
Yes, it's a state tax law matter, as I previously stated. No need to argue about what we agree on.

We're not talking about the states "waiving" the sales tax. What I'm suggesting is that VW could have structured the BB to be a trade-in if someone wanted to buy another VW. YES, it could have been done, but they didn't. But if they did, the states would have no choice but to honor it as a trade-in, with the concomitant sales tax credit.
 

DanB36

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Savannah, GA
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2014 Q5 Prestige TDI, Monsoon Gray
What I'm suggesting is that VW could have structured the BB to be a trade-in if someone wanted to buy another VW.
Indeed, and with the 3-liter settlement, they did, but it's at the owner's option--you can either trade it against another car, or sell it back outright. Why not in the U.S. 2-liter settlement? My best guess is that they just didn't think about it until it was too late.
 

k1xv

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Location
southern Vermont
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09 TDI sedan, sold back 12/16. Present cars 2013 BMW X5 diesel, 2015 Corvette convertible
If you got sales tax trade in credit treatment at Volkswagen, and only at Volkswagen, someone would be complaining that the buy back was being transformed into a Volkswagen marketing promotion. This would cut out states of sales tax revenue (and we know they would not be happy) and also dealers and manufacturers of non-VW vehicles would complain that they were being disadvantaged by being put into a less competitive position.
 

DanB36

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Location
Savannah, GA
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2014 Q5 Prestige TDI, Monsoon Gray
If you got sales tax trade in credit treatment at Volkswagen, and only at Volkswagen, someone would be complaining that the buy back was being transformed into a Volkswagen marketing promotion.
Somebody might complain, but it's in the 3-liter settlement--owners (who are eligible for the buyback in the first place--i.e., only Gen 1 owners at this time) can, at their option, trade in the car at the servicing dealer, or sell it back to VW. Either way it's the same amount. Given this, I'd say the most likely reason there isn't a similar provision in the 2-liter settlement is simply that nobody thought to include one.
 

DieselMann99

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Location
Westchester County NY
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2013 Jetta TDI w/ Premium, DSG (Buyback Nov 2018); 2013 Jetta TDI (bought Dec 2018); also, bought a CPO 2017 Passat TSI (Nov 2018)
Indeed, and with the 3-liter settlement, they did, but it's at the owner's option--you can either trade it against another car, or sell it back outright. Why not in the U.S. 2-liter settlement? My best guess is that they just didn't think about it until it was too late.
I didn't know that they structured it that way for the 3.0L models. Interesting.

I think you're right that they just didn't think about it earlier on. From a practical standpoint, maybe it is too late. OTOH, there's no reason why they couldn't come up with a simple amendment to the settlement agreement using the same language from the 3.0L agreement. The states would scream, but everyone else would be happy. Don't get me wrong, I'm not counting on this. I doubt it will happen. I'd be shocked if it did. Just saying it could be done.
 
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