The State of Michigan will be looking over your shoulder when you sell that used car

When you buy a used car in the state of Michigan, and transfer the title, the Sate collects sales tax based on what the buyer writes down.  Until now, Michigan has never really challenged what the car buyer writes down.

This appears to be coming to an end.

 The forms that I have attached below show that Michigan is going to be using a database that will compare the value of your car too the amount that you report in the title transfer.

As you can see, there doesn't appear to be a lot of wiggle room if you purchase a car for less than market value.

You will need to be prepared to explain your bargain purchase.

The State is moving more and more to the guilty until proven innocent policy when it comes to collecting taxes.  This appears to be another simple revenue generater that is mechanical and requires little human intervention.

Doug Zandstra CPA CFE EA

Certified Public Accountant

Certified Fraud Examiner

Enrolled Agent

29 Pearl St NW, Ste 225

Grand Rapids, MI  49503616 970 3000

dougzandstra.com

email doug@dougzandstra.com