Taxes and Insurance

[kevlind]

Greetings.
I'm considering a Roadster build as a retirement project and am trying to calculate the overall cost, not only of the build itself, but living with the final product as well. My concern is that the state of Virginia - never one to pass up any opportunity to tax cars outrageously - and my insurance company will consider the Roadster to be a $45,000 high-end high-performance sports car and will charge accordingly. Am I missing something here? What are the group's experiences?
Many thanks,
Kevin Lindsey
Alexandria, VA

[Papa]

Taxes are whatever your jurisdiction charges. Many states require you to pay sales tax on a car when you first register it. I had to present my registration office with "major" invoices to determine the tax. Those were the kit invoice and engine, transmission, and rear end. They didn't need to see all the other miscellaneous parts, paint, and body work.

Insurance varies by location as well, and how you insure the car. Best recommendation is to contact companies that you are considering and talk to them about the options available to you.

[luvaz]

Kevin,

Welcome to the forum!

I'm not in VA, so I can't speak to the tax aspect of your question.

Regarding insurance, there are many threads on it, with equally polarizing views on whether to add it to your daily driver policy or get a stand-alone collector policy. It varies from state to state (and many other factors). I have found that a collector policy with "agreed value coverage" is key. This forum has a long-time sponsor, Robbin Terry at Midwest Classics Insurance. He is very knowledgeable about FFR cars, and I recommend that you reach out to him for a quote.

Hope that helps (HTH)!
Will

[ggunter]

I had many questions about taxes and titling in Md. as well, which were going to determine if I even bought the car. Luckily all of my fears were dashed as Md. was incredibly easy to title and tag in. I was worried mainly about state inspection and emissions but here in Md/ there are two ways around that. Either Street Rod tags or Historic tags. Both options take the car out of the inspection and emissions. Not sure if Va. still has the personal property tax or not but I know that sucks if you still have to put up with that.

[GFX2043mtu]

Insurance shouldn’t be crazy, I live in Michigan which has some of the highest rates in the country and for a collectors insurance policy and a agreed upon value way above $45K and no mileage limits, I’m paying in the $700 range a year. My bigger concern would be the local/state taxes. I’ve heard of some states raking people over the coals year after year in taxes.

[kevlind]

I had many questions about taxes and titling in Md. as well, which were going to determine if I even bought the car. Luckily all of my fears were dashed as Md. was incredibly easy to title and tag in. I was worried mainly about state inspection and emissions but here in Md/ there are two ways around that. Either Street Rod tags or Historic tags. Both options take the car out of the inspection and emissions. Not sure if Va. still has the personal property tax or not but I know that sucks if you still have to put up with that.

Thanks for all the input.
Virginia assesses a personal property tax on cars, collected yearly for the life of the vehicle. Although it depreciates over time, the owner of a $45K car can expect to pay about $1000 per year for the first few years. Like Maryland, we also have the historic tag option, which exempts the car from emissions and, I think, safety inspections, but I believe the car has to be twenty-five years old. I don't recall ever seeing a Cobra kit car in this area with historic tags, which probably means that kit cars don't qualify. I'll have to ask around about that.
Thanks for the lead to Robbin Terry at Midwest Classics Insurance. I'll reach out to him when the time comes.
Kevin

[phileas_fogg]

Hi Kevin,

I'm in Fairfax, a little south of George Mason University's main campus.

For taxes & registration, check out https://thefactoryfiveforum.com/showthread.php?26749-2017-Virginia-Registration-I-have-plates!!!. The information is ~3 years old, but doesn't seem to change much. You'll find the current tax rate on the DMV website. The most recent annual personal property tax bill was $33.

Robin was able to get me a policy for $264/year for my Roadster through American Modern. Agreed to value was $42,500 & mileage limit was 3000/year. When you talk with him, you'll be able to set the agreed to value and the mileage limit and he'll let you know how the price changes.


John

P.S. You're welcome to visit any time it's convenient. However, right now my car is at a local painter, so I don't have anything to show you but pictures!

[kevlind]

Hi Kevin,

I'm in Fairfax, a little south of George Mason University's main campus.

For taxes & registration, check out https://thefactoryfiveforum.com/showthread.php?26749-2017-Virginia-Registration-I-have-plates!!!. The information is ~3 years old, but doesn't seem to change much. You'll find the current tax rate on the DMV website. The most recent annual personal property tax bill was $33.

Robin was able to get me a policy for $264/year for my Roadster through American Modern. Agreed to value was $42,500 & mileage limit was 3000/year. When you talk with him, you'll be able to set the agreed to value and the mileage limit and he'll let you know how the price changes.


John

P.S. You're welcome to visit any time it's convenient. However, right now my car is at a local painter, so I don't have anything to show you but pictures!

Hi John.
Thanks for the link - that helps a lot. This is starting to look doable...
Best regards,
Kevin

[ej95Cobra]

I registered in VA in 2017. The registration process includes an initial tax payment that is different than the local property taxes. I was relieved as I showed DMV over $43k in costs of the engine, transmission and complete kit in order to get it registered. The local property tax was based on a valuation much lower than my invoices. The total tax initially was $700 but decreases each year. There is an active Cobra Club in NOVA that would be a good resource for you. http://www.capitalareacobraclub.com/index.php?threads/northern-virginia-car-club-council.4110/

[Shades]

I noticed a couple responses mention showing invoices for the kit, rear, engine and trans for the initial tax. What about wheels and tires? I was thinking those are in the major components category too. Maybe not?

[phileas_fogg]

I noticed a couple responses mention showing invoices for the kit, rear, engine and trans for the initial tax. What about wheels and tires? I was thinking those are in the major components category too. Maybe not?

In my case, the wheels were included with the kit, and the sales tax for the tires was paid at time of purchase. So no need to include with the VA paperwork & get taxed twice.


John

[kevlind]

I registered in VA in 2017. The registration process includes an initial tax payment that is different than the local property taxes. I was relieved as I showed DMV over $43k in costs of the engine, transmission and complete kit in order to get it registered. The local property tax was based on a valuation much lower than my invoices. The total tax initially was $700 but decreases each year. There is an active Cobra Club in NOVA that would be a good resource for you. http://www.capitalareacobraclub.com/index.php?threads/northern-virginia-car-club-council.4110/

That's good to hear. I was also concerned about having to pay Virginia sales tax on the finished car, as well as the property tax. Maybe it's time to move to North Carolina.
Thanks very much for the link to the local Cobra club - I didn't know there was one, but I'll reach out to them asap if I make the plunge and order a kit.
Kevin

[ej95Cobra]

Same here, wheels came with the kit, no discussion about tires. I also included the title to my 1995 Mustang Cobra in case there were questions about incidental stuff. Only thing we used from Mustang were the rear (cut down 3/4" on each end) and the front calipers. I submitted my registration packet live in Richmond and waited only 25 minutes before they returned with my tax amount. Only comment from DMV was "nice car." It was much easier than I expected.

[ggunter]

Your right, in Md. the car is suppossed to be 25 years old and not heavily modified for Historic tags. I did not see how I would qualify for historic tags. When I took it to MVA and the state police inspected the car he only looked for stolen parts, he could have cared less about anything safety related. He asked me if I wanted the year of manufacturing to be 2020or 2021 so I went for 2021. So when he handed me the paperwork it said 2021 as year of mfg. I went to the main building and stated I wanted a title and historic tags. the COO says 1965 Replica and I belive that is all the girl behind the counter looked at because ten minutes I was done and walking out the door. They also only charged me minumum tax which is $30. I asked are we done, she said all done. So I wanted to grab the tags and run out the door, but the little voice inside my head said you know that some auditor is going to go over this transaction and give me a call with fines and interest in six months. So I had to put the brakes on and explain to her that the tax was not paid on 30k of the car. Then she gets an attitude and said "well you never told me that" I said I gave you a Certificate of Origin so you know the vehicle has never been titled. So I paid 6% of 30k and then left MVA a happy man.