12-15-2011, 02:15 PM
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#16 (permalink)
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A True Z Fanatic
Join Date: Jul 2009
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Quote:
Originally Posted by toxik
I maybe completely off but from what I understand of tax laws (at least when I took tax accounting) is that you only pay taxes once on the same item. So if you paid taxes on the purchase, you do not pay taxes again on the same vehicle. When insurance gives you money for your car, due to it being totalled, it should be no different than you selling a car to the insurance company, and the seller shouldn't pay taxes on a vehicle he already paid taxes for @ purchase.
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I have no idea what all you covered in you tax accounting class, but your income taxes basically works this way. There is still some double taxation baked into the system though.
I believe sales tax works the way I tried to explain in my above post.
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