MA Property tax on lease

[rplenge]

We leased a Grant Touring from the Natick, MA location in December 2023. On our most recent monthly pay we were charged >$1500 for a "property tax" on top of the monthly leasing fee. I was told by Lucid financing that Page 2, Section 13 ("Official Fees and Taxes") of the leasing document describes the requirement that the lessee is responsible for these payments. I don't recall making this payment on other cars that we have leased, nor do I recall Lucid describing this fairly substantial payment at the time I signed the lease.

I assume others have this same annual fee? If so, what is the approximate amount being charged per year? Do you recall Lucid disclosing this to you at the time of signing the lease?

BTW - I am very happy with the car! I am just surprised by the unexpected cost.

 

[borski]

Likely your MA excise tax: https://www.mass.gov/guides/motor-vehicle-excise#:~:text=Calculating the Excise,-$25 per $1,000&text=The excise rate is $25,the vehicle is usually garaged.

“If you own any motor vehicle that has been registered for less than a full calendar year, you will pay the excise based on the entire month when you registered that vehicle, as well as for the remaining months of the year. For example, a vehicle registered on April 9th will be billed an excise for April through December.”

Since Lucid registered it for you, it would make sense for them to collect the fee and pass it to the DMV as you have to do it within 30 days in MA, iirc, but IANAL.

I’m betting that’s it though

 

[RichMalden]

Massachusetts cities and towns absolutely charge the excise tax each year on leased vehicles and, as far as I've ever seen, lease companies always pass the charge through for that month.

It's once a year and drops rapidly each year there first few years. There should have even been a pro-rata (very small) one charged for 1 month of 2023 at some point too.

It's all formula based on $25 per thousand of original sticker price X a % based on model year of the car and the calendar year.

 

[rplenge]

An update: Lucid refers to the Excise Tax as a "Property Tax", so they are the same thing. We spoke with our Town who confirmed the amount of the tax assigned to the car and that the tax had indeed been paid. While we had paid the fee directly to Lucid and our bank confirmed that Lucid finance cashed the check, Lucid did not adjust the balance! That is, we had paid but they kept charging us. We called and had this corrected. The person at Lucid Finance was very nice and it was an easy fix. Still, it is concerning that we had to follow-up with this level of detail.

Moral of the story: if you see something that doesn't look right on your lease statement - especially in the "other fees" category - please follow-up with Lucid finance to get clarification.

 

[Tqlucid]

What’s not right? This is always how leases work. The leasing company never pays the property tax for a vehicle, you always do. Are you sure you’ve never paid excise tax on a lease? It’s how it always has worked…

 

[rplenge]

I was confused by the term property tax vs excise tax. My bad. And how this tax is administered varies by state - some on signing the lease and some billed later. Also my bad.

More importantly, Lucid Finance accidentally charged us twice - TWICE - for this tax. We paid the excise tax at the start of the year but they never recorded the payment and so kept billing us for the "property tax". When we call Lucid Finance the first time to inquire about the fee, they had no record of our payment. We then had to call our Town to confirm payment amount and call our bank to get verification that Lucid cashed the check. On the second call with Lucid they corrected their error of charging us twice.

Again, both Lucid Finance call reps were very nice and professional. It was simply frustrating that we were getting charged unnecessarily.

 

[Tqlucid]

Got ya! Glad they made it right. Don’t pay the tax twice! I always forget about property tax then when I get the bill it’s like damn. Leasing wise if you want to lower the bill as much as you can buying late in the year makes sense. Every year it gets much lower and having to only pay a few months for the 1st year helps as the second year is a lot lower.