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City of Chicago Vehicle Lease Tax

Discussion in 'North Central Region' started by modarin9, Mar 10, 2023.

    • Member

    modarin9

    Post Count: 11
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    I recently leased a 2023 i4 eDrive 40 from BMW of Rochester Hills, MI. As a resident of Chicago, Illinois the lease contract contained State, County and City Sales/Use taxes over the length of the lease.

    However, the dealership's title company located in New Jersey stated that in addition to those taxes I had to pay an additional $2818.00 City of Chicago, Cook Country tax and failure to do so they would withhold my Illinois license plates. Which by the way they did.

    Quote from NJ title company:
    Essentially the answer is yes, the customer is paying taxes upfront as well as in the payment. If you refer to the quote described next to Taxables it lists taxable fees and charges but states specifically that taxes are due upfront at time of titling. The city of Chicago, Cook County requires a 9% tax paid in the lease. It’s not exactly the best scenario when leasing a vehicle and living in Chicago but unfortunately there is no way around this.

    The lease contract was signed on January 20 and it was only two days ago that the plates were sent to me after paying this tax. This is my first lease but having after purchased cars in Illinois as recently as 2021 this tax is new to me.
    1. Has anyone heard of this tax?
    2. Has anyone else been required to pay this 9% tax?
    3. Can anyone clarify this situation for me?
    Obviously, I feel I have been scammed and failed to get legitimate and an official form/documentation regarding the tax. The dealer has only provided an email stating that the tax required in addition to all the other existing taxes.

    Thank you all for any guidance.
    Nestor Perea
    • Member

    MGarrison

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    Wish I knew more to be of more help, no experience with leasing and Ohioan here so no insight on Chicago taxes. Dug this up: https://codelibrary.amlegal.com/codes/chicago/latest/chicago_il/0-0-0-2606475 - see "B" of 3-32-030.

    The city's tax department, should, (you'd hope, anyway, assuming there's actually a possibility of forging through all the typical bureaucratical blocks to actually gaining access to a human in place in the government who actually knows anything to ask), be able to answer the tax question &/or clarify it.

    https://www.youtube.com/watch?v=VveTsyjFlNA
    https://www.youtube.com/watch?v=WNsu4PHD2B8

    Spoofs aside, there's nothing comedic about the extra tax expense. There's probably something in the code there about withholding licensing without payment or whatever blah blah, but on the surface as a matter of logic, seems puzzling the leasing company does anything with plate issuance outside of temporary plates, though I suppose it's likely if you don't have a title in hand or otherwise you can't get a vehicle registered & plated. Given what's in the code, sounds like they were complying with city tax regs vs. scamming, it seems.

    All that aside, congrats on the new ride!
    • Member

    modarin9

    Post Count: 11
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    Garrison thank you for finding that city tax code. All other city tax codes I found were mumbo jumbo legalese. This one is clear. Are you sure you are not an attorney? This would have resolved my dispute with the dealer if they had simply provided this document. I appreciate your help!
    To all other potential lessees in the City of Chicago, BEWARE!

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