In Texas if you trade a 10000 dollar car and buy a 25000 dollar car - you pay tax on the difference i.e. 15000.
So if the trade in goes up or the selling price goes down - the difference reduces, so your taxes are reduced in both cases.
I'll be participating in the VW "diesel buyback".
One problem with the generous offer (all my money returned) is that it is a cash deal and you will pay full tax on the replacement car as it is not a trade in (consequently, no trade in tax advantage). This is expressed within the buyback agreement so I'm pretty sure it's a statewide situation.
Sent from my iPad using Tapatalk