Vehicle Taxability - Leasing & Dealers

Leasing and Auto Dealer Transactions

When buying a vehicle from an auto dealer, there are many options available to the consumer.  Here we will provide information on how the sales tax applies to the different transactions that may occur.

 

Leases

A lease is any transfer of the possession or control of tangible personal property for a fixed or indefinite term, for consideration. Leases include future options to purchase or extend, and agreements where the amount of consideration may be increased or decreased by reference to the amount realized upon the sale or disposition of the property.

The link below will take you to a memo drafted by the Ohio Department of Taxation explaining how leases of motor vehicles are taxed.

Leasing Memo

 

Sales to Non-Residents of Ohio

Please see the Information Release for details.

 

Frequently Asked Questions Tool

The Ohio Department of Taxation has compiled a list of frequently asked questions covering many different categories.

To view the questions, click on the "Select Category" bar and then click on  the category in which you are interested.  A list of questions will appear pertaining to that category. Then click on the question you are inquiring about and the answer will appear.

If I purchase a vehicle at a local auto dealer and have the vehicle shipped out of the state or country, do I pay Ohio sales tax?

If the dealership arranges for and ships the vehicle, no Ohio sales tax is due because the transaction is in interstate commerce.  When the vehicle is titled, use exemption code IC.

If the vehicle is shipped out of the country by the purchaser, Ohio sales tax is due.

If the vehicle is shipped out of the state by the purchaser who is not a resident of Ohio, sales tax is due only if shipped to Arizona, California, Florida, Indiana, Massachusetts, Michigan, or South Carolina.  See Motor Vehicles - Sales of Motor Vehicles to Nonresidents of Ohio  for more information.

If I purchase a vehicle at a local auto dealer and have the vehicle shipped out of the state or country, do I pay Ohio sales tax?

If the dealership arranges for and ships the vehicle, no Ohio sales tax is due because the transaction is in interstate commerce.  When the vehicle is titled, use exemption code IC.

If the vehicle is shipped out of the country by the purchaser, Ohio sales tax is due.

If the vehicle is shipped out of the state by the purchaser who is not a resident of Ohio, sales tax is due only if shipped to Arizona, California, Florida, Indiana, Massachusetts, Michigan, or South Carolina.  See Motor Vehicles - Sales of Motor Vehicles to Nonresidents of Ohio  for more information.