Taxes on a Salvage Vehicle

Discussion in 'Auto Insurance Forum' started by DenverF10M5, Jan 31, 2017.

  1. DenverF10M5
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    DenverF10M5 New Member

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    I've been in negotiations with my insurance regarding a total loss. I'm planning to retain possession of my vehicle. In their last few offers, tax was always included. This time around, my adjuster stated that taxes aren't owed to me if I'm retaining the vehicle. I live in Colorado and have researched this topic, but can't find anything regarding taxes. Anywhere I've read online just says they'll calculate the value with taxes and registration fees, then subtract the salvage value. It makes sense they would keep the taxes if I keep the car, but I want to make sure this is the way it goes. Thanks
     
  2. djs
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    djs Super Moderator Moderator

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    Keep in mind, they don't keep the taxes, but there is no 'sale' generated which requires payment of taxes to you or to the state.

    If they take the car, then you have effectively 'lost' the value of the car and the cost to purchase it, i.e., the taxes and registration, etc. They will reimburse this to you. If you keep the car, there is a new titling fee, but there isn't a tax consequence (at least not in most states) so they don't need to reimburse it.
     
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