Some here were WRONG.... Buybacks on cars purchased post 6-28

[D3R3K]

You can still get these things for wholesale prices at auctions. Very few dealers seem to have caught on yet.

 

[luftwaffles]

I haven't read the whole thread, but there are a couple points worthy of comment.

• Personal gains are taxable (whether they're reported or not) unless explicitly excluded (e.g. sales of a personal residence).
• Compensatory damages received for physical injury, destroyed property, and expenses are not taxed. Other damages received are.
• The states and IRS can deem you a business engaging in for-profit activities whether you want to be one or not. This is applicable if, for example, you buy, register, and sell 15 cars this year and the state decides you're a dealer. This might also throw a wrinkle in your plans, since dealers aren't eligible for the settlement. (CORRECTION: VW dealers aren't eligible)
• The tax treatment of your gains is complicated because some of it is a sale and some is restitution.

Is all the money you get from VW taxed? No, I'm not saying that. Nor am I giving tax advice. My point is that you should probably talk to a competent CPA, tax lawyer, or both before the IRS sends you a bill for taxes due plus penalties and interest after you file your taxes.

 

[Snufalufagus]

The states and IRS can deem you a business engaging in for-profit activities whether you want to be one or not. This is applicable if, for example, you buy, register, and sell 15 cars this year and the state decides you're a dealer. This might also throw a wrinkle in your plans, since dealers aren't eligible for the settlement.

Are we sure this is true? I though only VW dealers weren't eligible.

 

[speedrye]

I haven't read the whole thread, but there are a couple points worthy of comment.

• Personal gains are taxable (whether they're reported or not) unless explicitly excluded (e.g. sales of a personal residence).
• Compensatory damages received for physical injury, destroyed property, and expenses are not taxed. Other damages received are.
• The states and IRS can deem you a business engaging in for-profit activities whether you want to be one or not. This is applicable if, for example, you buy, register, and sell 15 cars this year and the state decides you're a dealer. This might also throw a wrinkle in your plans, since dealers aren't eligible for the settlement.
• The tax treatment of your gains is complicated because some of it is a sale and some is restitution.

Is all the money you get from VW taxed? No, I'm not saying that. Nor am I giving tax advice. My point is that you should probably talk to a competent CPA, tax lawyer, or both before the IRS sends you a bill for taxes due plus penalties and interest after you file your taxes.

Non-VW dealers are eligible for the buyback, but I've got a question on VW reporting any of this to the IRS. VW can't report any of this on a 1099 as income since they don't know what your actual costs are in the car and they won't be getting SS numbers for people either. That pretty much leaves the taxing of the vehicle up to your honesty if you made money on the car, correct?

 

[FVWVWF]

[*]The states and IRS can deem you a business engaging in for-profit activities whether you want to be one or not. This is applicable if, for example, you buy, register, and sell 15 cars this year and the state decides you're a dealer. This might also throw a wrinkle in your plans, since dealers aren't eligible for the settlement.

Can the state "decide" you're a dealer or does one have to have a dealer licence?

 

[speedrye]

Can the state "decide" you're a dealer or does one have to have a dealer licence?

Each state is different. In NC, if you sell 5 or more cars, you're a dealer, but there are exclusions for a number of things. One of those is judgements/lawsuits, etc. or if you're actually driving the cars in good faith. Pretty lenient around here.

 

[D3R3K]

The states and IRS can deem you a business engaging in for-profit activities whether you want to be one or not. This is applicable if, for example, you buy, register, and sell 15 cars this year and the state decides you're a dealer. This might also throw a wrinkle in your plans, since dealers aren't eligible for the settlement.
Are we sure this is true? I though only VW dealers weren't eligible.

Actually dealers like myself are specifically mentioned in the class action settlement.

 

[Freeze Plug]

Can the state "decide" you're a dealer or does one have to have a dealer licence?

I wish!!! I'd kill for a dealer's license that involves no jumping through hoops!

 

[luftwaffles]

I'm going to assume you guys are correct about the dealer versus VW dealer thing. It doesn't apply to me, so I haven't researched it. I edited my previous post to reflect that.

That pretty much leaves the taxing of the vehicle up to your honesty if you made money on the car, correct?

Correct. Here's an example for why that may or may not be relevant. Let's say you pour hot coffee on yourself and win a lawsuit against McDonald's for $10 million. Your medical treatment accounts for $10,000 and the remainder is for punitive damages and the emotional trauma you endured when you found out the laws of physics also apply to you. None of that is reported to the IRS. You can be darn sure that when your name shows up in the newspaper regarding the judgement, they're going to be watching your tax return to see if you report it. They will come after their share.

Will the IRS find out? Who knows. The odds are probably in your favor. They're generally more interested in people cheating on their taxes on the scale of millions, not thousands. But if someone is going to take the gamble, they should probably be well-informed about the potential consequences and likelihood of success.

Can the state "decide" you're a dealer or does one have to have a dealer licence?

As speedrye noted, the specifics depend on the state. But they can basically say "you're a dealer; you need a dealer's license."

Whether you're a dealer or not is relevant to the tax situation. If you're a dealer, the cars are part of your inventory and suddenly your gains are ordinary income.

If you have the money to buy half-a-dozen of these cars, you have the money to pay a CPA to get advice or even a letter ruling from the IRS. If you can't afford that, you probably shouldn't be screwing around with this stuff.

 

[02TDIred]

Settlement disbursement ?

Settlement Agreement (Pg 10) reads, at 2.33—

“Eligible Vehicle” means Model Year 2009 through 2015 Volkswagen… equipped with 2.0-liter TDI engines that… (2) are, at any point during the period September 18, 2015 to June 28, 2016… or (is) owned by a Non-Volkswagen Dealer in the United States or its territories that… (b) holds the vehicle by bill of sale;

AFAIK, a car traded in on the dealer's in-stock inventory of NEW cars, will hold only a bill of sale (from the party trading THEIR car in against the dealer's NEW car).

Question: Is a dealer who sold an '09 - '15 VW/TDI entitled to ANYTHING from this settlement ?

 

[grawk]

seems amazingly unlikely.

 

[D3R3K]

Settlement Agreement (Pg 10) reads, at 2.33—
“Eligible Vehicle” means Model Year 2009 through 2015 Volkswagen… equipped with 2.0-liter TDI engines that… (2) are, at any point during the period September 18, 2015 to June 28, 2016… or (is) owned by a Non-Volkswagen Dealer in the United States or its territories that… (b) holds the vehicle by bill of sale;
AFAIK, a car traded in on the dealer's in-stock inventory of NEW cars, will hold only a bill of sale (from the party trading THEIR car in against the dealer's NEW car).
Question: Is a dealer who sold an '09 - '15 VW/TDI entitled to ANYTHING from this settlement ?

I was wondering the same thing.

 

[Trade Wind]

https://www.consumer.ftc.gov/blog/vw-owners-get-facts

Best part:
"If someone makes you an offer for your VW or Audi car, or suggests limits on the buyback program that don’t exist, please report them to the FTC. We worked very hard to get a fair deal for VW and Audi owners and lessees, and we don’t want anyone to undermine it."

So making an offer on a VW TDI, by their own words, warrants being reported to the FTC? Note to self, polish harmonica for my impending time in the big house.

 

[tpk]

Just joined, but have owned a 2012 Golf TDI since November of 2014. I've been following this story since it broke, right here on the forums. I've probably read every post on Threadzilla (may it rest in peace).

I wanted to say thank you to everyone in this thread. I recently picked up another 2012 Golf TDI. 45k miles, DSG, Navi, Sunroof. Paid $11500 cash. The kid I bought it from thought I was a sucker, but I drove away with a knowing smile. (Fingers crossed he doesn't report me to the FTC! /s) I hemmed and hawed about buying another one until last week, but am glad I did.

Post-6/28 calc on the claims site has my check at 20,220. Minus ~220 for smog/title/tags in Oregon. Oh, and NO SALES TAX. Can't beat that for a day's work. Not counting on the portion of the unclaimed seller's fund, but it would just be the cherry on top.

EDIT: wanted to add that I'll be making a donation in Threadzilla's name once my checks clear. Won't be huge, but wanted to do my part to keep the forums alive. Hopefully others are considering doing the same.

 

[sierra3]

Let's see. The settlement was announced on a Tuesday. First thing Friday morning I was at a non-VW dealer before they opened and bought a 14K mile 2013 Passat...even made them come down by $2K.

 

[Not Happy With VW]

After doing a lot of reading (of the court docs and here) I also bought 3 additional tdi's after 6/28/16. I made sure to only buy ones that would bring a nice profit not factoring in any additional amount above the 9/15/15 clean trade in amount. After looking at the online claims website my hopes of getting 50% of the restitution is still there (hope it stays that way).

Now before certain ones burn me at the stake, I bought 2 from small used car lots, and one from a private owner that bought it a few months ago and needed to sell it asap to buy his parents suv they were selling.

I almost bought a 2014 beetle Tdi with 18000 miles for $13,000 (I.E.:$$$$$!!!) but I informed the guy that he should hold onto it and sell it back to VW. He had no clue of the buyback and he was selling it for his mom, so I gave that guy a $14000 tip!

Would you like to import a car from Ontario?

I have a 2013 Jetta TDI with 110000 km on it.

 

[Airpizz6]

I wonder how many IRS or state tax authority employees are monitoring this board. I'm not sure that bragging about windfalls is prudent.

 

[tpk]

I wonder how many IRS or state tax authority employees are monitoring this board. I'm not sure that bragging about windfalls is prudent.

I doubt state and federal tax authorities troll message boards for leads. You'd think it would be a better data set, like registration applications and bank transactions.

 

[gmcjetpilot]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

 

[schultp]

Way too go... how can you get more unethical?

Oh I suppose one could write software to cheat emission testing so that millions of your cars would spew toxins into the environment.

Paul

 

[DanB36]

Way too go... how can you get more unethical?

What exactly do you believe is unethical about it? And why?

 

[coolbreeze]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

Ever purchased a stock?

Sorry you feel morally Superior, but I feel no regret being capable to purchase TDI's to sell back legally, as decided by a court and VW.

 

[purduecrew]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

Well I'm included in that blanket statement. Please explain how this is unethical?:roll eyes:

I think you are just butthurt you didn't think of it first. A lot of that illness going around right now.

 

[grawk]

Buying now lets people who need to sell now have more options. Not unethical at all. Basically no voluntary transaction is ever unethical.

 

[tpk]

Buying now lets people who need to sell now have more options. Not unethical at all. Basically no voluntary transaction is ever unethical.

I would expect that a seller does their own due diligence. I can't be blamed if they didn't.

 

[Freeze Plug]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

this gave me a good laugh, too funny!

 

[Airpizz6]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

VW has to get 85% of these TDIs off the road. By buying them and registering them on the website, the people you question are actually performing a service. It helps VW locate the cars easier and will help get the polluters to the scrapyard or fixed if that is possible. That is unethical?

 

[NamesLucky]

Most used car dealerships don't want to hold onto these until Dec(ish). I've let both dealerships I bought TDIs from know about the buyback, they'd rather have the sale (and I'm inferring, open up funds to buy more cars to profit off of) Private sellers may also have their reasons for getting rid of a car now, even at a loss.

 

[tdiono]

how was this deal? picked up a 2012 black golf 4dr dsg tech package for $16k with 40k miles on it. i plan to keep it and accept the $3200ish amount. if all fails, the buyback is $21k

 

[Jimmy Coconuts]

I reading this correctly, people bought cars for the express purpose to have them bought back for profit?

Way too go... how can you get more unethical?

How about by convincing my wife and other family members to do it too?