[ckolsen]

If you trade in a car, say $12000 on a $30,000 car, do you pay tax on only $18,000? What is you owe $6000 on the trade in
car, do you pay tax on $24,000? Thanks!

 

[cardinal_creek]

In PA anyway, you pay tax on the difference. The theory is that you already paid tax on the car your trading in when you originally bought it.

 

[ISFAN]

Cardinal is correct once again. You only pay tax on the diff.