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4	Lesson Plan Outline COURSE OVERVIEW We will provide you a complete course of instruction. If a renewal dealer, sit back and relax for four hours of dealer education. we will have you take a 30 minute questionnaire. we will explain how to operate within current DMV guidelines. we will provide a DMV certificate of completion. If a new dealer, you will have a six hour block of teaching today. we will provide a course certificate suitable for framing. this certificate is required for you to take the DMV examination. our certificate is good for ONE year. Renewals are available. a 70 % score is needed to pass the dealer examination.
5	Lesson Plan Outline COURSE OVERVIEW We will provide you a complete course of instruction. All materials provided, including study materials and handbook. We encourage questions during class. We will need to a copy of your valid Calif. DL or ID.
6	TriStar Motors L.L.C. TriStar Motors, L.L.C. 1601 Folsom Street San Francisco, California, 94103 Attention : Al, Joe & Willis * Al is often hard to reach 1- 888 - 942 - WISH office, schedule information & paging 1- 888 - 948 - 1795 reservation fax machine JW974@juno.com e - mail Certified For Use By The Dept. Of Motor Vehicles DMV Service Provider CCC0004 issued 04.01.98
7	Legal Disclaimer LEGAL DISCLAIMER This Handbook Is Not Intended To Offer Legal Advice. If You Have Specific Concerns Or A Legal Question Consult The Department Of Motor Vehicles Or An Attorney. Although We Attempt To Be As Accurate As Possible, We Make No Representations As To The Accuracy Of All Information Provided. WRITTEN, EDITED AND PUBLISHED BY: TriStar Motors, L. L. C. 1601 Folsom Street San Francisco, California, 94103 © 2003 TriStar Motors, L. L. C. Fifth Edition All Rights Reserved. No Part Of This Book May Be Reproduced In Any Form Or By Any Electronic Or Mechanical Means, Including Photocopy, Recording, Or Any Information Storage And Retrieval System, Without Written Permission From The Publisher. Printed In The USA
8	Dealer Licensing No person shall act as a dealer...without having first been issued a license or a temporary permit as required under 11700 & 11701 cvc. The following forms are to be completed and filed to obtain a license, as required under 11704 cvc: Application Checklist, OL 248B Application, Part A, OL 21A Application, Part B, OL 29 Questionnaire, Part C, OL 12
9	Dealer Licensing The following forms are to be completed and filed to obtain a license, as required under 11704 cvc: Livescan Form, Fingerprints, DMV 8016 Zoning Verification, Local Agency, OL 902 Financial Information Release, OL 53 Bond Appointment Form, OL 25
10	Dealer Application Checklist
11	Dealer License Application Part A Page 1 of 2
12	Dealer License Application Part A Page 2 of 2
13	Dealer Application Part B Page 1 of 4
14	Dealer Licensing A dealer must post a bond of $ 50,000 prior to license being issued. A lesser bond of $10,000 is allowed for wholesale only if: fewer than 25 sales annually. In lieu of posting a bond a dealer may deposit cash with the DMV or with an approved FDIC bank or savings and loan. This deposit shall be held 3 years after license is retired. With no claims outstanding, the deposit is returned. It is unlawful to operate w/o having a bond in effect.
15	Dealer Licensing The office of the principal place of business, and each branch location, must be established prior to license issuance. Photo set of each required. Temporary, transitory & mobile offices are acceptable, provided items are not a part of the inventory for sale. All records must be kept at the place of business. (4 years)
16	Dealer Licensing The office of the principal place of business, and each branch location, must be established prior to license issuance. Photo set of each required. The display area of each location, required for retail locations, must comply as follows: It must be of sufficient size to accommodate each type of vehicle the dealer is licensed to sell and be clearly marked for exclusive use. Display areas must be within 1000 ft. of the office.
17	Dealer Licensing Permanent signage required for retail locations sufficient to withstand weather. A temporary sign is allowed with a permanent sign on order. It shall have an area of at least two ( 2 ) square feet per side. It shall be able to be read from a distance of fifty ( 50 ) feet. At each location the dealer must post the dealer’s license. At each location the dealer must post the sales license(s) The sales license fee is $ 93, with no test, good for three years. See exhibits on pages 23 - 24.
18	Dealer Sales Person Application
19	Dealer Licensing Every retail dealer, at each location, shall post a notice, at least 8” by 10”, which states: “ The prospective purchaser of any vehicle may, at his or her own expense, and with the approval of the dealer, have the vehicle inspected by an independent third party, either on or off the premises.” We have provided you a ready to post sign.
20	Dealer Licensing Every retail dealer, at each location, in each sales office, at each desk where terms of sales or lease transactions are discussed, shall post a notice at least 8” by 10“ which states: “California law does NOT provide for a “cooling off” or cancellation period for vehicle purchase or lease contracts. THEREFORE, You cannot later cancel such a contract simply because you change your mind, decide the vehicle costs too much, or wish you had acquired a different vehicle. After you sign a motor vehicle purchase or lease contract, it may only be canceled with the agreement of the seller or lessor OR for legal causes such as fraud.” We have provided you a ready to post sign.
21	Dealer Licensing Fee schedule
22	Dealer Licensing Renewal fees are due annually and must be paid by the expiration date. You may renew within 30 days after expiration, with penalty as listed previously. After 30 days, NO renewal means NO more license. Some counties impose additional fees for dealer plates. Every dealer must complete a 4 hour continuing education course once every two years, prior to license renewal. Only those dealers who are wholesale only, selling fewer than 50 cars per year are exempt. The original continuing education certificate of completion we provide must be sent to DMV Occupational Licensing. See exhibits on pages 25 - 26.
23	Certificate and Class Exam
24	Dealer Licensing Every dealer shall notify DMV: 10 days prior to the effective date of an ownership change. 30 days prior to the effective date of any corporate change. $ 70 is the fee for a corporate change. If there has been an ownership or corporate change, the dealer will need to submit a new original application and fees, along with a New dealer bond. Once the application is completed, the dealer will be issued a new dealer number.
25	Dealer Licensing If there is a corporate officer change, an OL-15, Application, Personal History Questionnaire, Livescan and a fee of $ 70. Any change in the dealer address, be it branch add or removal, name change, add or delete category, add autobroker, dealer type change or location change requires immediate notification to the Inspector of jurisdiction, an application and fees posted prior to change. See exhibits on pages 27 - 30.
26	Corporate Office Change Form
27	Corporate Officer Change Form
28	Dealer Licensing Dealer license & plates automatically & immediately cancel whenever : Change of the established place of business is made w/o notice. Established place of business is abandoned w/o notice. Bond is not maintained. Inadequate bond is not replaced or restored. Voluntary surrender of special plates & license. Involuntary surrender of special plates & license. Failure to notify DMV new person designated as licensee. Suspension or revocation by the Secretary of State. Suspension or revocation by the Board of Equalization.
29	Broker and Consignment Licensing Auto brokers must be licensed dealers. An auto broker must complete a written agreement with a customer prior to arranging a sale through another dealer. The agreement must clearly indicate the broker fee. The broker fee can only be paid by the selling dealer. The autobroker endorsement fee for this license is: $ 50 the first year, $ 25 for renewal. The broker must maintain a log of each brokered transaction. See exhibits on pages 31 - 32.
30	Add Broker Agreement/Broker Log
31	Broker and Consignment Licensing A consignment is an arrangement under which a dealer agrees to accept possession for the purpose of sale and the owner will then pay the dealer from the proceeds of the sale. Auto consignors must be licensed dealers. Auto consignors must write an agreement prior to sale. Auto consignors must complete an accounting and make payment within 20 days of the date of sale. Failure to complete and/or comply with the terms of the agreement or failure to pay the consignor within 20 days of the sale is cause for suspension and/or revocation of the dealer’s license.
32	Broker and Consignment Licensing The consignment agreement shall include: vehicle description date of agreement current market value (low book value) liens outstanding repairs to be made (repairs to be left as-is and disclosed) compensation to consignor
33	Broker and Consignment Licensing The sales accounting, within 20 days, shall include: date of sale repairs authorized with records liens payable to lienholders evidence of payment of liens total sales price
34	Permanent Branch Locations A dealer branch is any location beside the principal location which is maintained for the sale and/or exchange of motor vehicles. Branch license required when retail vehicles are offered for sale. Any attempt,solicitation or negotiation at the location requires a license. On all reports of sale from a branch location the dealer shall use that location and not his principal location address. *Taxes are distributed by point of sale & county of residence.
35	Permanent Branch Locations A dealer branch is any location beside the principal location which is maintained for the sale and/or exchange of motor vehicles. The dealer shall submit to DMV a branch application, with a fee of $70. All permanent branch locations must provide with application: Zoning verification letter Photo set of location and office See exhibit on pages 33 - 34.
36	Dealer Photo Set
37	Offsite Sales / Temporary Branch Locations An offsite sales license is needed when a dealer, at a location used for a limited duration, intends to engage in motor vehicle sales. These sales are handled as temporary branch location sales. All temporary branch locations must provide with application, ten days prior to opening, to the Inspector of jurisdiction: Copy of lease, rental agreement Copy of promoter’s notice Zoning verification letter Photo set of location and office See exhibits on pages 35 - 36.
38	Temporary Branch Location
39	Offsite Sales / Temporary Branch Locations The branch location must have: Sign of two square feet readable from 50 feet with dealer name and permanent license address posted. Temporary permit, Salesperson licenses, No Cooling Off and Vehicle Inspection Notice signs posted Display area independent of other dealers with no other vehicles. No parking of public or employee vehicles in display area
40	Offsite Sales / Temporary Branch Locations A branch license is not required when: Motor vehicles are displayed on a temporary basis at a location such as a public shopping mall, an exhibition or similar exhibit provided the dealer meets the following provisions: The vehicle display is less than 30 days and no sales are offered. No consideration, deposit or trade-in to be accepted. Location must be of a type available to all dealers. The dealer shall, display a sign, including the dealer’s name and principal location, with the statement: “No sales permitted and no deposits accepted at this location.”
41	Licensing Checklist Licensing Checklist The process can be broken down into three steps: Dealer Class, Practice Exam & Certificate Getting your bond & submitting an Application Final location inspection by your DMV Inspector
42	Licensing Checklist Here is a list of everything: Dealer Education School, Call TriStar @ 888.942.9474 and obtain your Certificate. Obtain the DMV Inspector’s number for your area and leave a message to schedule the examination. Locate your Inspector @ www.dmv.ca.gov Pay $ 16 and pass the DMV exam. You need 70% to pass, 28 correct of 40 questions. Choose the Name and Location of your dealership. Obtain the Zoning Verification Letter.
43	Licensing Checklist Here is a list of everything: File a Fictitious Name Statement with the county clerk and have it published in a local paper. Obtain a Surety Bond in the amount of $ 50,000. Wholesale & less than 25 cars/ year then $ 10,000. Obtain a Business License Obtain a Live Scan Fingerprint Card. To obtain a location check @ www.doj.ca.gov
44	Licensing Checklist Here is a list of everything: Complete the Application and have someone read it over for you to look for errors and omissions. Ask your DMV Inspector if you can FAX it in for review. Call the DMV Inspector and submit the Application with your Bond Declaration Form. You must have a Bond in place to submit your application. Build your office before you contact the DMV Inspector for final inspection and clearance.
45	Licensing Checklist Here is a list of everything: Obtain a phone and have a phone line installed in the name of the dealership, including a 411 listing. If retail, Obtain and install exterior signs. One sign if sole user of the location. Multiple signs if mixed use at the location. If retail, Install the two Office Signs provided by TriStar: The No Cooling Off Period Notice to Public The Inspection of Vehicle Notice to Public
46	Licensing Checklist Here is a list of everything: Create a locked cabinet, desk drawer, file cabinet or safe to store DMV report of sale forms. Open a Bank Account in the name of the dealership. Label a thick 3 ring binder as your dealer book. This book will hold for all updates sent by the DMV, all ROS forms you might have to void & your broker log. For forms write to: DMV P.O. Box 932242, Sacramento,CA, 94232
47	Licensing Checklist Here is a list of everything: Contact a Law Supply for forms & disclosures. The two forms needed: conditional sales contract CA553 as-is no warranty for Federal Buyers Guide Create & have ready photos of your setup. Instruction on photos @ www.dmv.ca.gov Call the DMV Inspector for an inspection appointment.
48	Licensing Checklist Here is a list of everything: When you pass inspection you will receive your: dealer number temporary license special plate report of sale forms, for your type of license. End Checklist
49	Conditional Sales Contract The contract definition derives from California civil code section 2981. “ Any contract for the sale of a motor vehicle between a buyer and seller under which possession is delivered to the buyer and seller and either: (a) the title vests in the buyer thereafter only upon the payment of all or a part of the price, or the performance of any other condition, or (b) a lien in the property is to vest in the seller as security for the payment of part or all of the price, or for the performance of any other condition.” See exhibit on pages 48 - 49.
50	Sales Contract
51	Conditional Sales Contract A successful sale is a process involving a certain order of events. A sale made in the wrong order may “unwind” a sale. See exhibit on page 50. A sales tax refund is allowed if the buyer does not take possession. All contracts for purchase of a motor vehicle must be in writing. The contract must be contained in a single document. We recommend contracts containing “California Judicial Council” stamp. The contract must contain all agreements of the buyer and seller with respect to the total cost and terms of repayment for the motor vehicle.This shall include any evidences of indebtedness, including a promissory note.
52	Order of Sale
53	Conditional Sales Contract All contracts for the purchase of a motor vehicle must be signed by both buyer and seller and delivered to the buyer. A contract signed by the dealer only is called a purchase order. A Spanish copy, blank, attached to the original for Spanish speakers.
54	Conditional Sales Contract All contracts for the purchase of a motor vehicle require certain disclosures as per the civil code and federal regulations. These items must be disclosed on the sales contract: Itemization Of Amount To Be Financed
55	Conditional Sales Contract These items must be disclosed on the sales contract: Amounts Paid to DMV Amounts Paid For Insurance Premiums * only if sold by dealer
56	Conditional Sales Contract These items must be disclosed on the sales contract: Down Payment Total Total Amount Financed * must match Amount Financed below.
57	Conditional Sales Contract These items must be disclosed on the sales contract per federal law: Annual Percentage Rate Finance Charge Amount Financed *must match Total Amount Financed above. Total Of Payments Total Sales Price Payment Schedule
58	Conditional Sales Contract The sales contract must clearly indicate: Interest computation and conversion to Annual Percentage Rate, Monthly payment amount and how computation was made, hidden, deferred or balloon payments, and due dates. A refund of any and all moneys paid by purchaser shall be made by the dealer when the purchaser elects not to sign the contract. * Deposits do not give the dealer ANY advantage. * Even if the purchaser signs the contract and pays for the vehicle the sale does not transact until the purchaser takes delivery of the vehicle.
59	Conditional Sales Contract Remember: Seller signs, Buyer signs, Buyer gets copy, Seller gets cash. The civil code and federal truth in lending regulations apply to all dealer transactions. A printed contract form from a law form supply house is required. The dealer may repossess w/o notice if the buyer defaults. *We suggest you keep a set of KEYS for each vehicle under contract.
60	Conditional Sales Contract A dealer breach nullifies the contract and the dealer is required to refund any and all moneys. * Do not deliver the vehicle until all contract items have been done. * A dealer DO list carries a liability and leaves the contract OPEN.
61	Conditional Sales Contract The party carrying the contract must prove default as a prerequisite to further action. They may repossess as follows: A 15 day notice must be issued. The original buyer may pay in full and be reinstated. This may occur multiple times w/o penalty. The original buyer shall receive sale information within 20 days of sale. * 20 day consignment sale rules apply. Loan amount, repossession costs & Division 12 items are the only charges against this type of sale. A bill or a check must be issued to close the sale.
62	Conditional Sales Contract Whenever a contract fails to execute due to an inability to obtain financing the dealer must: Refund all moneys paid by purchaser Return trade-in vehicle to purchaser *Never sell a trade-in vehicle until the contract is fully executed.
63	Conditional Sales Contract All sales contract negotiated in Spanish require the dealer to provide a Spanish language contract. All disclosure signs posted should be in Spanish. Any required disclosures should have blank Spanish copy attached. A statement signed by the Spanish speaker is recommended. The maximum fee a dealer may charge for document prep is $45. (And must be the same for all sales!)
64	Motor Vehicle Financing Once again, the dealer must disclose the terms of financing on the sales contract as per sections 2981 of the civil code & regulation z. The simple interest method & the precomputed basis method are the two methods permissible by the civil code. Usury laws have been eliminated and rates do vary. Regardless of the method, the rate must be converted into an annual percentage rate applicable to the unpaid balance. The unpaid balance, using the annual percentage rate must then be computed into a base monthly payment over the term of the contract. *This allows a comparison between dealers for a similar vehicle.
65	Sales and Use Tax All dealers are required to obtain a permit from the State board of equalization to collect and remit sales & use taxes. All dealers shall, in every transaction of a used vehicle, pay to the state the applicable sales and use taxes. We recommend a separate check to the board for each retail transaction. The memo box of the check should include: ROS number, year make and model of the vehicle, sales price with docs fee & smog inspection, buyers county of residence & tax rate. These checks should be set aside for monthly or quarterly reports.
66	Sales and Use Tax The basic sales and use tax is 7.25% There are some counties with increased rates. Check with state board local office for applicable rate at your location. Dealers are not required to collect additional tax if the buyer lives outside the higher tax district as per B of E regulation 1823.5(d).
67	Sales and Use Tax The taxable selling price is the total of the following: The vehicle cost The accessories added and the labor to install them. The document preparation fee ( $ 45. Max.) The smog inspection fee ( $ 50. Max.) The following items are non-taxable: Finance charges License & registration fees Insurance charges Smog certificate fee ($8.25 Max.)
68	Sales and Use Tax All dealers shall, when applicable, pay a separate use tax for vehicles in inventory obtained with advance registration. All dealers shall, when applicable, pay a separate use tax for vehicles in inventory used for personal use.
69	Department of Motor Vehicle Forms The report of sale book is required of each dealer, provided by and remains DMV property. There are separate wholesale and retail report of sale forms. The wholesale report of sale form is a one-part form and must be sent to DMV within 5 days upon vehicle transfer to another dealer.
70	Department of Motor Vehicle Forms The retail used vehicle report of sale is required for each sale. The four parts are: Application copy (mail w/title & reg262 within 30 days, local) Dealer’s notice (mail to DMV within 5 days, Sacramento) Purchaser’s operating copy (in vehicle window) Book copy (in office for four (4) years)
71	Department of Motor Vehicle Forms Mark voided forms and place all parts in your dealer book. The dealer must keep track of each numbered form. The DMV recommends using the forms in numerical order.
72	Department of Motor Vehicle Forms If you need forms: In an emergency, contact your DMV Inspector. For a list of Inspectors, access @ www.dmv.ca.gov Order forms at DMV, PO Box 932242, Sacramento, CA, 94232 See exhibits on pages 51 - 61. The books are the property of the DMV, must be available for inspection and the dealer must take steps to reasonably store and protect the documents.
73	Wholesale/Retail Report of Sale Forms
74	Retail Repot of Sale Form
75	Report of Sale/ Title Exhibit
76	Title Exhibit
77	Duplicate Title Application
78	REG262 Transfer Form
79	Department of Motor Vehicle Forms Each retail ROS form must be completed in its entirety. The sections are: (1) Date of sale as is the date the buyer paid for the vehicle or the date the buyer signed a contract and took possession of the vehicle. (2) The vehicle make and not the model. (3) The manufacturer’s year model as on title. (4) The body type abbreviation as per DMV. (5) The mode of power, generally gas or diesel. (6) The number of axles.
80	Department of Motor Vehicle Forms Each retail ROS form must be completed in its entirety. The sections are: (7) The unladen weight. (8) The vehicle identification number. Check vin as on title. (9) The last year of registration. (10) The last state or country of registration. (11) The last registered license plate number. (12) The buyer’s residence county, to determine fee. See tax guide pages 80 - 84 for additional information.
81	Class Information and Tax Guide
82	Tax Guide and Special Circumstances
83	Department of Motor Vehicle Forms Each retail ROS form must be completed in its entirety. The sections are: (13) The buyer’s name and California DL or ID. (14) The buyer’s mailing address. (15) The dealer’s name, address & authorized signer’s signature. (16) The dealer and salesperson license numbers. (17) The buyer’s signatures. (18) The vehicle odometer mileage
84	Department of Motor Vehicle Forms The five day dealer notice of sale copy, bottom of original, shall be mailed to the DMV within five calendar days, not counting the date of sale. The temporary operating copy shall be affixed to the vehicle interior so that it may be read from outside of the vehicle. If the vehicle has expired registration or will expire within 60 days place the copy in the lower rear window on the drivers side. The vehicle may have printed flashers while temporary is in the window.
85	Department of Motor Vehicle Forms If the vehicle is missing a front plate, remove rear plate, destroy it, charge the customer an additional $14 and make application for new plates. The fees shall be delivered to the DMV within 20 days of the date of sale. The dealer must pay fees, including penalties if expiration occurs prior to acquisition into dealer inventory.The buyer only pays fees from the date of sale forward, and the fee must be prorated, if applicable.
86	Department of Motor Vehicle Forms The buyer must pay one full year of fees when making application of an out of state vehicle. Dealer may not charge for required vehicle verification. The application copy shall be delivered to the DMV, along with all transfer documents, within 30 days of the date of sale. As of 01-01-99 fees may be paid within 30 days after the date of sale.
87	Vehicle Licensing and Registration There are two types of California title. They are complying title, date & miles printed on the front, and non-complying title, no date & miles printed. See exhibit on pages 56 - 58. To transfer a used vehicle you need to submit a signed title or duplicate application and a completed DMV REG262 after 05-01- 98. See exhibit on pages 56 - 61. You may encounter old style paperwork and you may still have to process this to complete a transfer.
88	Title Exhibit
89	Title Exhibit and Duplicate Title Application Form
90	Duplicate Title Application and REG262 Transfer Form
91	Vehicle Licensing and Registration The DMV REG 262 contains, on one form, all of the documentation needed for most vehicle transfers. The sections are: Vehicle identification section. *transfers w/o vin will be returned. Bill of sale section. The dealer identifies the buyer & seller, purchase price & if transfer is gift. Odometer disclosure statement. Must be complete and signed by both the buyer/ seller and the dealer.
92	Vehicle Licensing and Registration The DMV REG 262 contains, on one form, all of the documentation needed for most vehicle transfers. The sections are: Power of attorney This allows the dealer to register the vehicle into the buyer’s name. The power of attorney is not valid without a signature. Buyer and seller information Must be completed.
93	Vehicle Licensing and Registration All relevant documents pertaining to the terms and conditions of any sale shall be signed by the buyer. Printed names and signatures must be in ink. Errors or alterations on this form will void and a new one will have to be completed. No strikeouts, No whiteout and No highlighting. A dealer cannot represent both a buyer and a seller in the same transaction regarding assignment of power of attorney. Two bill of sale forms required. See exhibit, DMV REG 262 on page 61.
94	Vehicle Transfer form
95	Vehicle Licensing and Registration No person shall drive, move or leave standing upon a highway any motor vehicle unless it is registered and the appropriate fees have been paid in full. If a vehicle has expired California registration or it will expire within 60 days or it is an out of state vehicle, registration fees shall be collected by the dealer at the time of sale. All registration fees collected by the dealer are to be submitted to the DMV within 20 days of the date of sale. * As of 01-01-99 fees may be paid within 30 days after the date of sale.
96	Vehicle Licensing and Registration All dealers must pay a transfer fee following the sale of a used motor vehicle to the DMV. The fee is $15. as of 07-01-99. The time requirements for transfers are as follows: If the registration is expired or out of state the fees must be paid within 20 days from the date of sale. All other applications and transfer fees must be submitted and paid within 30 days of the date of sale.
97	Vehicle Licensing and Registration The time requirements for transfers are as follows: If the application is first submitted within 30 days of the date of sale and the application is returned the dealer has 30 days to correct and return the item but may not exceed 50 days from the date of sale to complete the transfer with the DMV to avoid a penalty. Administrative Service Fees are penalties issued against a dealer by DMV. Each ASF count against a dealer can be used as a separate count against the dealer’s license in any administrative action taken against the dealer. ASF penalties cannot be passed on to the buyer.
98	Vehicle Licensing and Registration When the following omissions occur a penalty is required : ASF penalty of $5: Dealer fails to send in “dealer notice” of report of sale. Dealer fails to display a report of sale copy on vehicle. Dealer fails to submit application with all fees, penalties and supporting documents to DMV within 30 days of the date of sale. ASF penalty of $25: Dealer fails to clear an application within 50 days. Application for waiver of fees requires a statement of facts from the manager of the DMV field office accepting application.
99	Vehicle Licensing and Registration An out of state delivery occurs when a buyer resides in another state and he wishes to register the vehicle in that state. The used report of sale should state: “for registration out of state”. The buyer must obtain registration from his home state before the vehicle is moved on the highways, or the buyer must obtain a one way permit from the DMV for a fee of $10. Notarized documentation of direct delivery needed for tax rules, unless a bill of lading from a licensed transporter is on file. Board of equalization forms recommended Access them @ www.bofe.ca.gov
100	Vehicle Licensing and Registration For vehicle sales out of country, if time is critical: A quick title request for certificate of title to be issued within 72 hours may be honored for an additional fee of $ 15. All original fees still apply and a completed original or transfer application must accompany the request. All quick title requests must be submitted to a specific office for processing.
101	Vehicle Licensing and Registration A dealer shall, without notice or request from the buyer and/or DMV return all fees overpaid by a buyer for licensing, taxes and transfer of vehicle. A dealer may not collect a non- refundable deposit and must refund all deposits when a buyer chooses not to complete a sales transaction. Delivery of the vehicle at the licensed location is required for completion. This would include so called “auto buying service” fees. This would include deposits for custom or specialty vehicles.
102	Vehicle Equipment, Division 12 Compliance Dealer liability exists on all safety equipment. A vehicle sold by a Licensed dealer must comply with all division 12 requirements. The vehicle must be safe. The vehicle must comply with federal safety standards. The lighting equipment must be operational. The brakes must be above 30% useful life. The rear view mirrors must be operational. The horn must be operational. The smog devices must be operational.
103	Vehicle Equipment, Division 12 Compliance Dealer liability exists on all safety equipment. A vehicle sold by a Licensed dealer must comply with all division 12 requirements. The safety belts must be operational. The seatbelt warning system must be operational in 1st sold after 01-01-93. The bumpers must be in place. The muffler must be operational. The tires must be above minimum wear standards. The windshield must be in place with no cracks. The wipers must be operational. Absolutely NO waiver of division 12 requirements See exhibit on page 62.
104	Division 12 Inspection Form
105	Vehicle Equipment, Division 12 Compliance No as-is sales are allowed. If a vehicle does not meet division 12 requirements, it may only be sold to another dealer with a disclosure, a statement of facts stating: This vehicle DOES NOT meet division 12 requirements. This vehicle is being sold for parts. not to be driven again or This vehicle is being sold for salvage. may be reconditioned See exhibit on page 63. As of Jan 1, 2001. all auctions must be licensed dealers. Disclosure requirements for as - is vehicles required in writing.
106	Division 12 Disclosure Form
107	Division 12 Inspection Form TriStar Motors, LLC 1601 Folsom Street, San Francisco, California, 94103 Telephone: 415..552..1011 Fax Line: 888..948..1795 VEHICLE LICENSE : ______________________________ VEHICLE REGISTRATION :________ YEAR, MAKE, MODEL : ____________________________ VIN :__________________________ MILES :___________ PASSED SMOG TEST ON :______________ CERTIFICATE # :__________
108	Division 12 Inspection Form VEHICLE EQUIPMENT, DIVISION 12 DEALER COMPLIANCE CHECKLIST: _________ THE LIGHTING EQUIPMENT MUST BE OPERATIONAL _________ THE BRAKES MUST BE ABOVE 30% USEFUL LIFE ( > 3/32”) _________ THE REAR VIEW MIRRORS MUST BE OPERATIONAL _________ THE HORN MUST BE OPERATIONAL _________ THE SMOG DEVICE MUST BE OPERATIONAL _________ THE SAFETY BELTS MUST BE OPERATIONAL _________ THE SEATBELT WARNING SYSTEM MUST BE OPERATIONAL (1-1-93) _________ THE BUMPERS MUST BE IN PLACE
109	Division 12 Inspection Form VEHICLE EQUIPMENT, DIVISION 12 DEALER COMPLIANCE CHECKLIST: _________ THE MUFFLER MUST BE OPERATIONAL _________ THE TIRES MUST BE ABOVE MINIMUM WEAR ( > 2/32”) _________ THE WINDSHIELD MUST BE IN PLACE, No Cracks _________ THE WIPERS MUST BE OPERATIONAL _________ ODOMETER MUST BE FUNCTIONAL, Non- Division 12, US Code NO WAIVER OF DIVISION 12 REQUIREMENTS
110	Division 12 Inspection Form INSPECTION MADE BY :________________ TODAY’S DATE :____________ DEALER LIABILITY EXISTS ON ALL SAFETY EQUIPMENT. A VEHICLE SOLD BY A LICENSED DEALER MUST COMPLY WITH DIVISION 12 REQUIREMENTS AS PER SECTION 24007 CVC. (Contact TriStar Motors, LLC at 1.888.942.WISH for Dealer Education and Certification Class)
111	Odometers The odometer must be functional & in working condition at the time of sale. It is an illegal act to operate a motor vehicle with the intent to defraud. Altered odometers are also illegal. It is a crime to disconnect, reset, rollback or alter an odometer with the intent to alter the mileage displayed. Repaired odometers require disclosure unless mileage remains the same. A proper disclosure is made with a STATEMENT OF FACTS. See exhibit on page 68 - 69.
112	Statement of Facts
113	Odometers If the odometer is repaired and cannot accurately reflect the mileage, the odometer shall be adjusted to read “00000” and a plate shall be attached to the left doorframe indicating the mileage before and date of service. * This plate shall be made of engraved metal or hard plastic. Odometer disclosure shall be completed by the legal owner of record, the repossessor, on all vehicles that have been repossessed, using a separate odometer disclosure statement of facts form.
114	Odometer The word “repo” is entered in lieu of a signature on the face of complying title. A certificate of repossession is used to complete a transfer without the registered owner’s signature. See exhibit on page 70.
115	Repossession From
116	Smog / Air Pollution Control All used motor vehicles, must pass a smog test and certificate on file prior to offering a vehicle for retail sale. For purposes of the smog test vehicles must be in excess of 7500 miles. For purposes of California registration, out -of state vehicles with less than 7500 miles cannot be registered. Dealer to dealer sales have an exemption from smog test requirements.
117	Smog / Air Pollution Control A vehicle is assumed to pass unless disclosed in writing. Therefore, Statement of Facts & salvage disclosure required if no smog or non division 12. As of January 2001, ALL auctions must be licensed dealers and written disclosure required on as-is sales to dealers @ auction sale.
118	Smog / Air Pollution Control The maximum charge for smog inspection is $50. The maximum charge for the certificate is $ 8.25. * if smog fee exceeds allowance only charge $ 58.25. Only increase fee when the law changes per DMV. As of 01-2000, dealer smog good for (2) two years. A Release of Liability, filed in the name of the dealership, as buyer, may assist in removing enhanced status for dealers in non – enhanced areas. See exhibit on page 71.
119	Release of Liability
120	Bureau of Automotive Repair Regulations Any dealer who desires to offer and conduct automotive repair is required to register with the Department of consumer affairs. This registration is required by the Bureau of automotive repair Act and includes all who, for compensation, engage in the business of repairing or diagnosing vehicle malfunctions.
121	Vehicle History Disclosures The dealer must accurately reflect the known condition of the vehicle at the time of sale and/or advertisement. The dealer must disclose material damage to a buyer. This is any damage a buyer might want to know in making their decision to purchase the vehicle. Failure to disclose may result in a sale being unwound (give the money back) and punitive damages. This information shall be disclosed on a statement of facts form. At this time there is no section which requires this disclosure, yet section 9900 cvc requires it in new car and demo transactions. Some dealers perform a carfax type report on each vehicle to avoid unpleasant surprises. Once again, repaired odometers require disclosure unless the mileage remains the same and the odometer remains functional.
122	Vehicle History Disclosures Disclosure of prior history usage is required when a vehicle has been: Rental, Taxi, Insurance salvage, Revived salvage, City, county, state or federal vehicle or any former law enforcement vehicle. Disclosures must be signed by the buyer prior to completion of the contract. Minor items may be listed on the Federal Buyer’s Guide. Required disclosures should be done on a Statement of Facts form. See exhibit on page 68 - 69. A Spanish language copy should be provided, when appropriate.
123	Statement of Facts
124	Vehicle History Disclosures The lemon law requires manufactures to repurchase or replace vehicles from new car buyers when they prove to be defective. IF a new vehicle is in the shop more than 30 days or repaired 4 or more times, it is a defective vehicle. And a “lemon” as per civil code. As such, any dealer who offers a Lemon vehicle for sale, prior to lease, sale or transfer must provide the buyer a statement which reads: This motor vehicle has been returned to the manufacturer due to a defect in the vehicle pursuant to consumer warranty laws. The title to this vehicle is permanently branded with the notation “lemon law buyback”.
125	Vehicle History Disclosures The dealer shall affix a plate identifying the vehicle as a “lemon law buyback” to the left front door frame and it cannot be removed. * This plate shall be made of engraved metal or hard plastic. It is the dealers responsibility to brand title and doorframe of out of state vehicles for resale.
126	Warranties There are several types of warranties which may arise during the dealer offer for sale of a motor vehicle. Two implied warranties exist, as specified by the uniform commercial code unless affirmatively disclaimed by the dealer. These are: Implied warranty of merchantability. This warrants the vehicle is fit for the ordinary purposes for which it was intended. It goes without saying that the vehicle complies with Division 12.
127	Warranties If an after sale repair is made on for a NON -Division 12 item we suggest: A small nominal fee ( $5. ) for the repair and a warranty release signed with copy to the buyer to prevent further repairs and avoid an implied extension of the warranty from the ‘goodwill’ repair. See exhibit on page 72. Implied warranty of fitness for a particular purpose. This warrants the vehicle is fit for a particular purpose, for instance, towing a boat.
128	Warranty Release Form
129	Warranties Express warranties arise from oral or written agreements between The dealer and the buyer. * Be careful what you & your staff say to your customers. Most dealers do not get themselves in trouble, their salespeople usually do that for them. The dealer may include a warranty in the price of the vehicle by means of the Buyer’s Guide. This type of inclusive warranty is taxable. You must specify full or limited warranty, % of parts and labor you will pay, which systems are covered and for how long. See exhibit on pages 78 - 79.
130	Buyer’s Guide
131	Warranties Service agreements are required to fully and conspicuously disclose in simple and readily understood language the terms, conditions and exclusions of the contract. This type of warranty is not taxable. The disclosure requirements are: Name of the buyer Description of the vehicle Date of commencement & duration Parts covered Steps to obtain warranty service
132	Warranties Service agreements are required to fully and conspicuously disclose in simple and readily understood language the terms, conditions and exclusions of the contract. This type of warranty is not taxable. The disclosure requirements are: Right to cancel provision, if any. Dispute resolution procedures available. Dealer statement of who has the legal & financial obligation to perform the warranty service & of what he will and will not do in the event of a problem.
133	Federal Buyer’s Guide The requirements for the used car buyers guide as specified in section 455 of the US code of regulations. They are: This form is signed by the buyer only before sale. A buyers guide must be posted by the dealer on the side window of every vehicle displayed for sale with both sides visible. The label may be removed temporarily for a test drive but must be re-affixed after the test drive is complete.
134	Federal Buyer’s Guide The dealer shall have the buyer’s signatures. The original or a copy of the buyer’s guide, including all terms and Required disclosures, shall be presented to the buyer upon completion of a used vehicle sale. This document should be used to identify ALL known defects in writing. If you disclose it, you do not have to fix it, excluding Division 12 items. See exhibit on pages 78 - 79.
135	Buyer’s Guide
136	Use of Special Plates The use of dealer plates is appropriate when: used by the licensed dealer for any purpose used by an individual in the dealer household for pickup & dropoff used to operate any vehicle in the dealer’s inventory for demonstration with letter of authorization, unaccompanied up to seven days or with a licensed salesperson and no letter used for a special event by any individual w/ letter of authorization used by any employee of the dealer for dealer related functions. used by an employee transferring between dealer sales locations. used by a licensed salesperson for demonstration purposes only. * no additional use unless vehicle is leased or rented to him / her. Used by a family member as long as the licensee is present in vehicle.
137	Use of Special Plates The personal use of a dealer plate creates tax liability. The rates of tax are based upon the purchase price and they are: 1 / 40th per month for dealer personal use. 1 / 60th per month for salesperson personal use. All vehicles should be placed in inventory using a release of liability form placing the dealer as buyer on the date of acquisition. All vehicles in inventory operated on the public streets, regardless of registration tag expiration date, shall have a dealer plate affixed. All dealer principals may pull a trailer using a dealer plate. *See tax guide pages 83 - 87 for additional information.
138	Special Circumstances and Personal Use
139	Trade-in Sales and Disclosure/ Dealer Sales
140	Use of Special Plates The use of dealer plates is not appropriate when: used by an employee doing personal business. used for work and service vehicles. used by a family member without the licensee present in the vehicle unless for pickup and dropoff as described above. The dealer plate shall be displayed on the rear of the vehicle and over the original plates, if a vehicle has been previously registered. The registration card for the dealer plate shall be with the vehicle bearing the dealer plate. We suggest you tape a reduced size copy of your dealer license & registration card to each dealer plate.
141	Advertising Advertising refers to any act, statement, or announcement Intentionally communicated to the public by whatever means, orally, in writing or otherwise. The ad requirements: The year, make & model shall be in the ad. The dealer shall identify himself in the ad, in terms readily identifiable. The use of “dlr” or dealer number is unacceptable. The last 6 digits of the vin or the plate number shall be in the ad. The picture, if any, in the ad shall depict the vehicle as equipped. A stock number in the ad is allowed, but not to replace the vin or plate.
142	Advertising The ad requirements: The advertised price shall prevail regardless of the buyer having knowledge of the advertised price. The advertised price shall include total price, except sales tax, registration, smog & dealer prep fees. The dealer must notify the advertising medium(s) used within 48 hours following the sale of an advertised vehicle requesting an overprint of “sold” on the ad or a withdrawal of the vehicle. The dealer is only required to provide proof of compliance for ad removal after sale. It is immaterial whether advertising medium(s) actually make withdrawal.
143	Advertising Prohibited practices: A dealer cannot advertise free items with purchase. * Free items with a test drive or showroom visit are OK. A dealer cannot offer guaranteed trade - in allowances. A dealer cannot insure credit to all who walk through the door. A dealer cannot offer simulated checks and/or coupons for savings. A dealer cannot use the terms, “invoice”, “dealer’s cost”, or “wholesale cost” in a vehicle ad. A dealer cannot use underselling claims, such as “no one sells cars for less” in an ad.
144	Advertising Disclosure requirements: A dealer must disclose the availability of all advertised vehicles. They must be on the lot, on a test drive, in for repairs or sold. A dealer must disclose any prior history of the vehicle in the ad, such as rental, salvage, prior law enforcement use, etc. Any website or internet advertisement must follow the above listed guidelines.
145	Stolen Vehicle Prevention A thorough verification of indicia prior to purchase is the safest way to prevent the acquisition of a stolen vehicle. A dealer should always obtain a bill of sale, multiples if necessary to show clear transfer of the vehicle. A dealer should question sellers with duplicate title and/ or no title. A dealer should compare vin, plate & registration and verify all match.
146	Stolen Vehicle Prevention A thorough verification of indicia prior to purchase is the safest way to prevent the acquisition of a stolen vehicle. A dealer should always verify the id of any seller by means of a photo copy. A dealer should contact local police or local CHP for a vin check, if concerned about questionable title.
147	Unlawful Dealer Activities A dealer’s license is a privilege and should be treated with great care. Failure to obey the regulations are grounds for suspension and / or revocation of the license. Some activities that have gotten others in trouble are: It is illegal for a dealer to issue a bad check to DMV. * Late payment with involve an ASF, a bad check could revoke your license. It is illegal for a dealer to fail to transfer title to the DMV.
148	Unlawful Dealer Activities It is illegal to possess any dealer plates without a license. It is illegal to allow anyone to use these plates as a dealer. * Lending and / or borrowing is strictly prohibited. It is illegal for a dealer to allow sales from unlicensed locations. It is illegal for a dealer to lend or allow anyone to use dealer reports of sale. It is illegal for a dealer to fail to make payment of administrative service fees.
149	Unlawful Dealer Activities It is illegal for a dealer to fail to notify DMV, within 10 days, regarding the hiring or firing of any licensed salespersons. *The cvc definition includes all managers and finance personnel. It is illegal for a dealer to employ unlicensed sales employees. Commissions to unlicensed salesman, known as bird-dog fees, are illegal. Bait & switch practices, advertising at a low price, disparaging that product and switching to a higher priced product are prohibited.
150	DMV Enforcement Actions All dealers are licensee’s of the state and therefore are subject to actions at three levels of government. They are: Administrative action by the DMV for any and all violations of applicable sections of the vehicle code, the civil code, the code of regulations and the business & professions code. Civil tort & contract claims in state and federal courts at all levels. This includes Small claims court, Superior court and US district court. Criminal investigation and arrest with prosecution in criminal courts by the district attorney, grand jury and the attorney general.
151	DMV Enforcement Actions Failure to maintain adequate bond and / or meet the continuing education requirements can result in immediate DMV enforcement action to terminate a dealer’s license. Remember, to contact your Inspector whenever the need arises. You can locate your area DMV Inspector @ www.dmv.ca.gov
152	Class Administration Section We offer a brief question & answer period. If we are stumped with a question, we will research and call you with the answer. We have hopefully provided you a complete course of instruction. If a renewal dealer, we will now provide the course completion form. This course must be renewed every TWO years.
153	Class Administration Section We have hopefully provided you a complete course of instruction. If a new dealer, we will have a practice examination now. A 70 % score is needed to pass the exam. A course certificate will be presented upon passing. Certificate is required to take the actual DMV examination. The certificate is good for ONE year. Renewal of expired certificates is available.
154	Class Administration Section We have hopefully provided you a complete course of instruction. Make sure we return your Calif. DL or ID and the information on your certificate of completion is correct. If you need a replacement certificate FAX us a copy of your receipt and we will send one out at no charge to you. TriStar Motors, L.L.C. 1601 Folsom Street San Francisco, California, 94103 Attention : Al, Joe & Willis * Al is often hard to reach 1- 888 - 942 - WISH office, schedule information & paging 1- 888 - 948 - 1795 reservation fax machine JW974@juno.com e - mail
155	Tax Guide Supplement to TriStar Dealer Education Handbook As DMV course providers and licensed used vehicle dealers we felt an obligation to go beyond the minimum class requirements. There are State Board of Equalization regulations which go beyond the DMV requirements. Our purpose with this handbook is to assist you to learn and comply with all applicable regulations. LEGAL DISCLAIMER All Information Concerning Legal Issues Outlined In This Handbook Is Strictly Informational.
156	Tax Guide This Supplement Is Not Intended To Offer Legal Advice. If You Have Specific Concerns Or A Legal Question Or If You Are In Doubt About A Specific Activity Or Transaction Consult: The State Board of Equalization, 450 N Street, Post Office Box 942879 Sacramento, California, 94279 Or Consult An Attorney. Although We Attempt To Be As Accurate As Possible, We Make No Representations As To The Accuracy Of All Information Provided.
157	Tax Guide Record Keeping and Accounting Sales and Use tax law requires you to keep adequate financial records. You must be able to show: Gross receipts, Taxable & Non-Taxable items, Deductions Claimed and the Purchase price of each item and vehicle purchased for purposes of resale. You must have Records which include: Normal accounting books & ledgers, with documents to support these books, such as bills, invoices, receipts, repair orders & sales contracts.
158	Tax Guide Record Keeping and Accounting You must have Records which include: Tax returns, with schedules and working papers used in their preparation. You should be aware that failure to maintain these records is evidence of negligence, and negligence is considered as intent to evade taxes which may result is substantial penalties. A representative of the State Board of Equalization may examine all documents for verification of tax paid or to determine tax when no return is filed.
159	Tax Guide Special Circumstance Sales You must be prepared to make tax adjustments in some situations. License fees collected are not taxed, except when... the fees collected exceed the amount required by the DMV, the excess is taxed. a vehicle is accepted for trade and sold, the fees paid in advance are taxed. * If the dealer pays these fees in advance, they are not taxed.
160	Tax Guide Special Circumstance Sales Accessories and labor, when performed before delivery to the buyer are taxed. Document preparation charges are taxed. Sales commissions paid from proceeds are not deducted from the taxable amount. When financing & insurance are not itemized on the contract, the total is taxed. When a dealer allows an accommodation sale, where an employee or salesperson displays a personal car for sale, AND a conditional sales contract or DMV report of sale is used, the sale is taxed.
161	Tax Guide Special Circumstance Sales When a dealer conducts a consignment sale, the sale is taxed. When a dealer sells to a member of the military, the sale is taxed unless: The buyer has a valid military ID, out of state DL, and transfer orders placing him / her in California for military service. When a dealer sells to a foreign diplomat, the sale is taxed unless: The buyer produces an identification letter from the Office of Foreign Missions or a valid tax exemption card, issued by the US Dept. of State.
162	Tax Guide Special Circumstance Sales When a dealer sells to a US government agency or the American Red Cross the sale is not taxed. When a dealer sells to a handicapped person, receiving special parking privileges per 22511.5 cvc, that portion attributed to modification is not taxed. When a dealer sells a handicapped modified vehicle for public or private transport, that portion attributed to modification is not taxed. When a dealer sells a company or demonstration vehicle, the sale is taxed. When a dealer purchases a service or company vehicle, the sale is taxed.
163	Tax Guide Personal Use Circumstances You must be prepared to make tax adjustments in some situations. When a dealer purchases a vehicle for resale & holds in it inventory, using the vehicle solely for demonstration and display the purchase is not taxed. When used for purposes other than demonstration and display, tax is due. The amount of tax varies by use. When a dealer assigns such a vehicle to a licensed salesperson, for a period of less than 12 months, a monthly tax based on 1/60 of the purchase price is due.
164	Tax Guide Personal Use Circumstances When a dealer assigns such a vehicle to an employee or officer, for a period of less than 12 months, a monthly tax based on 1/40 of the purchase price is due. When a dealer assigns such a vehicle to a licensed salesperson, employee or officer for a period beyond 12 months, the purchase price is taxed and a credit is given for any monthly tax previously paid. When a dealer assigns a vehicle to anyone other than a licensed salesperson, employee or officer for any period of time, the purchase price is taxed. * Weekend test drives without a letter of authorization are taxed.
165	Tax Guide Personal Use Circumstances When a dealer purchases parts & accessories for vehicles held in inventory, no tax is due, except paint, paint supplies, tools & equipment are taxed. When a dealer makes a loan of a vehicle in inventory to a customer, awaiting delivery of a purchased vehicle or return of a repaired vehicle, for a period of less than 30 days, the fair market rental value is taxed, as long as display & demonstration precedes and follows such use.
166	Tax Guide Personal Use Circumstances If the loan is made and these conditions are not met, the purchase price is taxed. When a dealer make a loan of a vehicle in inventory to a driver training program the use of the vehicle in this situation is exempt from tax.
167	Tax Guide Local & District Sales & Use Taxes When a dealer makes a sale where the buyer is registering the vehicle outside of the special district, the buyer is exempt from the local or district tax. The dealer must obtain a declaration, signed by the buyer, under penalty of perjury, which shows the address of storage and registration for this exemption.
168	Tax Guide Trade - In Vehicles & Sales Discounting When a dealer accepts a vehicle for trade - in, that value may not be deducted from the amount on which sales and use tax is charged. There is no adjustment if that value is more or less than fair market value. When the dealer allows a discount, the tax is computed on the sales price less the discount. The sales contract must clearly show the sales price & discount amount, the taxable amount and the sales tax collected. When the dealer accepts a trade - in and allows a discount in the same transaction it must be clearly shown on the sales contract. If not, the entire amount is taxed.
169	Tax Guide Warranties When a dealer makes a repair under an existing factory warranty, the parts furnished for the repair are to be considered included in the original sales price and not taxed. When a dealer makes a repair under an optional service warranty, the parts furnished for the repair are to be taxed. When the customer is required to pay a portion of the parts, this amount is taxed. When a dealer makes a sale involving an optional service warranty, that portion for the warranty is not subject to tax. When a dealer makes a sale involving the transfer of an existing service warranty, that portion for the warranty is not subject to tax.
170	Tax Guide Out of State & Foreign Sales When a dealer makes an out -of - state sale it is exempt from tax as long as: The title transfers to the purchaser outside of California. The vehicle is out - of - state 90 days or >50% of 180 days after sale. The dealer maintains out - of - state evidence of registration. The dealer has documents which support out - of - state delivery. * We suggest you collect tax and reimburse buyer to be safe.
171	Tax Guide Out of State & Foreign Sales When a dealer makes an out -of - country sale it is exempt from tax as long as: The purchaser must obtain a DMV one way permit. The vehicle must be shipped or delivered outside the US within 30 days. The dealer must retain evidence of out - of - country delivery. If the dealer completes an exempt sale and these conditions are not met the purchase price is taxed.
172	Tax Guide Dealer Sales When a dealer makes a sale to another dealer, for the purpose of resale, the sale is exempt from tax as long as the selling dealer maintains a copy of the buying dealer’s Seller’s permit. When a dealer makes a sale to another dealer, for the purpose of service or company vehicle, the sale is taxed. When a dealer makes a sale and fails to complete a DMV report of sale the sale is taxed, regardless if the buyer has paid tax to the DMV. Please be diligent in your maintenance of records and payment of Sales & Use taxes.