Senate File 315 - Introduced SENATE FILE 315 BY SMITH A BILL FOR An Act relating to the fee for new registration for a vehicle 1 purchased within sixty days of the sale of another vehicle 2 by the same owner. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2482XS (2) 86 ns/nh

S.F. 315 Section 1. Section 321.105A, subsection 2, paragraph 1 a, subparagraph (2), subparagraph division (a), unnumbered 2 paragraph 1, Code 2015, is amended to read as follows: 3 In transactions, except those subject to subparagraph 4 division (b) or (0c) , in which a vehicle subject to 5 registration is traded toward the purchase price of another 6 vehicle subject to registration, the purchase price is only 7 that portion of the purchase price which is valued in money, 8 whether received in money or not, if the following conditions 9 are met: 10 Sec. 2. Section 321.105A, subsection 2, paragraph a, 11 subparagraph (2), Code 2015, is amended by adding the following 12 new subparagraph division: 13 NEW SUBPARAGRAPH DIVISION . (0c) In cases involving two 14 separate transactions in which an owner who is not a dealer 15 sells a vehicle subject to registration to a purchaser, whether 16 in this state or out-of-state, and, within sixty days before 17 or after the date of the sale, purchases another vehicle 18 subject to registration, the amount of the sales price of the 19 vehicle sold by the owner shall be considered trade-in value 20 and exempted from the purchase price of the vehicle purchased 21 by the owner. To qualify for the exemption, the owner shall do 22 one of the following, as applicable: 23 (i) If the qualifying sale of a vehicle occurs prior to the 24 owner making application for new registration and certificate 25 of title for the newly purchased vehicle, the exemption shall 26 be included in the calculation of the fee for new registration 27 on the newly purchased vehicle. At the time the owner applies 28 for new registration and certificate of title, the owner 29 shall provide to the county treasurer payment of the fee for 30 new registration and proof of the transaction involving the 31 qualifying sale of a vehicle and the sales price of the vehicle 32 sold. 33 (ii) If the qualifying sale of a vehicle occurs after the 34 owner applies for new registration and certificate of title 35 -1- LSB 2482XS (2) 86 ns/nh 1/ 4

S.F. 315 and pays the fee for new registration for the newly purchased 1 vehicle, the owner may apply to the department for a refund of 2 the amount of the fee for new registration already paid which 3 is in excess of the amount owed after the exemption provided 4 for in this subparagraph division (0c) is applied. 5 Sec. 3. Section 321.105A, subsection 6, paragraph a, Code 6 2015, is amended by adding the following new subparagraph: 7 NEW SUBPARAGRAPH . (4) If the amount of the fee for 8 new registration paid by the owner of a vehicle subject to 9 registration was computed upon the full purchase price and 10 the owner subsequently qualifies for an exemption pursuant to 11 subsection 2, paragraph “a” , subparagraph (2), subparagraph 12 division (0c), the owner is entitled to a refund of the amount 13 paid in excess of the amount owed after the exemption is 14 applied. Notwithstanding subsection 5 or any other provision 15 of law to the contrary, to obtain a refund, the owner shall 16 apply to the county treasurer on a form provided by the 17 department and provide proof that the fee for new registration 18 for the newly purchased vehicle was paid and proof of the 19 qualifying sale of another vehicle and the sales price of 20 the vehicle sold. No later than sixty days after the date 21 the owner applies to the county treasurer, the department 22 shall issue a refund to the owner or notify the owner that 23 the application for a refund is denied and the reason for the 24 denial. 25 EXPLANATION 26 The inclusion of this explanation does not constitute agreement with 27 the explanation’s substance by the members of the general assembly. 28 Under current law, when the new owner of a vehicle subject to 29 registration applies for registration and certificate of title, 30 a fee for new registration is due in the amount of 5 percent of 31 the purchase price of the vehicle. In transactions in which a 32 vehicle is traded toward the purchase price of another vehicle, 33 the value of the trade-in is excluded from the purchase price 34 of the vehicle when calculating the fee for new registration. 35 -2- LSB 2482XS (2) 86 ns/nh 2/ 4

S.F. 315 This bill provides for a similar calculation of the purchase 1 price in cases where a person sells one vehicle and purchases 2 another vehicle in separate transactions. Under the bill, if a 3 person sells a vehicle subject to registration to an in-state 4 or out-of-state purchaser and purchases another vehicle within 5 60 days before or after the sale, the amount of the sales 6 price of the vehicle sold is treated as trade-in value and is 7 exempt from the purchase price used to calculate the fee for 8 new registration for the vehicle purchased. If the qualifying 9 sale of a vehicle occurs before the fee for new registration 10 is paid for the newly purchased vehicle, the exemption shall 11 be included in the calculation of the fee for new registration 12 which is remitted to the county treasurer by the owner, or, if 13 the vehicle is purchased from a dealer, by the dealer on the 14 owner’s behalf, along with the application for registration 15 and certificate of title. The owner must provide proof of the 16 qualifying vehicle sale and the sales price of the vehicle 17 sold. If the qualifying sale occurs after the fee for new 18 registration is paid for the newly purchased vehicle, the owner 19 may apply to the county treasurer for a refund of the amount 20 of the fee paid in excess of the amount owed. The application 21 for a refund must be accompanied by proof that the fee for new 22 registration for the newly purchased vehicle has been paid and 23 proof of the qualifying sale of another vehicle and the sales 24 price of that vehicle. The department of revenue has 60 days 25 in which to issue a refund of the excess payment or notify 26 the owner that the application for a refund is denied and the 27 reason for the denial. 28 In accordance with current law relating to the calculation 29 of the purchase price in transactions involving traded 30 vehicles, the name or names on the title and registration of 31 the vehicle purchased must be the same as the name or names on 32 the title and registration of the vehicle sold, with certain 33 exceptions for transactions involving spousal ownership and 34 transactions involving family members, business ownership, or 35 -3- LSB 2482XS (2) 86 ns/nh 3/ 4

S.F. 315 loan cosigning requirements. 1 -4- LSB 2482XS (2) 86 ns/nh 4/ 4