Tips on Buying Cars: Customer Rebates, customer rebates, car deal

Question
Can a car dealer keep a manufactures cash rebate and just lower the purchase price of the vehicle?  (lower the taxable amount)

Answer
Tim,

Thanks for your question.  A car dealership can keep the manufacture's rebate, only if they apply the rebate to the sales prices of your vehicle, thereby lowering the selling price of that vehicle (the taxable amount).  Now, if the customer so chooses, the dealership can not apply the rebate the car deal and apply for the money to be sent by form of a check directly to the customer.  The dealership can not "scoop" the rebate.  This means the dealership MUST apply the rebate to the car deal in some form as listed above in the two scenarios I gave you.  Most dealerships will negotiate the car deal using the rebate as a form of reduction of the sales price.  It is how the dealership gets to most customers prices that the customer wants to be at.  The dealership must show on all paperwork where the rebate is from.  For example, lets say the sales prices is 14,000 on the purchase agreement, and the next line would say manufacture's rebate of 1000.  that would mean the actual sales price to the customer is 13000 which is the price the customer would pay taxes on.  If there is a rebate on a particular unit (and the manufacture, not the dealer, determines which vehicles have rebates) the dealership MUST give the rebate to the customer in some form, either by reducing the sales price and itemizing it that way, or the customer getting a check directly from the manufacture, which is very rare.

I hope this answers your question, and thanks again for the question.

Thanks -

Jeremy