Public Acts 1 & 2 of 2018 changed the maximum trade-in value partial sales tax trade-in credit to incrementally increase annually. Beginning January 1, 2023, owners trading in a motor vehicle receive a sales tax credit for the vehicle’s trade-in value up to a maximum of $9,000. This is a $1,000 increase from the year 2022 maximum of $8,000.
Frequently Asked Questions
Can a trade-in sales tax credit be applied to a lease vehicle transaction?
No, the trade-in credit laws do not provide for trade-in tax sales tax credit for leased vehicles.
Is a motorcycle, moped, or motor home taken as a trade-in eligible for the trade-in sales tax credit?
Yes, any vehicle meeting the Michigan Vehicle Code definition of a motor vehicle is eligible for the trade-in sales tax credit.
Can valuables such as jewelry, coins, or collectibles taken as a trade-in receive sales tax credit?
No, the sales tax trade-in credit laws only provide a sales tax credit trade-in on eligible motor vehicles and recreational vehicles.
Can more than one vehicle be used as trade-in credit?
No, only one vehicle can be used toward the sales tax trade-in credit. If two or more vehicles are traded in, sales tax credit for only one of the vehicles can be applied.
Please see this bulletin from MDOS for more information and common questions about the credit.