Source: http://www.iiada.com/legislative_and_news.php
Timestamp: 2019-04-24 09:16:44+00:00

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The Indiana Department of Revenue has updated Information Bulletin # 28S to reflect the taxation of Document Fees effective April 2, 2019. Although no laws or Indiana Code Sections have been changed or updated, the Department of Revenue is making policy changes regarding documentation fees.
According to Information Bulletin 28S dated January 2019 and Effective April 2, 2019, fees for services performed after the transfer of a vehicle or trailer are not considered part of the sales price and, therefore, are not subject to sales tax. Transfer of a vehicle or trailer takes place upon physical delivery when the purchaser takes possession and control of the property, even though the title may not have yet been transferred. The dealer must maintain adequate records to show which services pertain to the fees charged and that the services were performed after the transfer of the vehicle or trailer to be exempted from sales tax. Fees charged for services performed prior to the customer taking physical possession of the vehicle or trailer are subject to sales tax.
Historically, separately stated fees labeled as “documentation fees” were presumed to be at least partially excluded from gross retail income because all or part of the fee was considered to be compensation for preparing and submitting documents to the Indiana Bureau of Motor Vehicles on behalf of the purchaser to complete titling and in some cases registration of the vehicle. Such services were considered to be a separately bargained for service that took place after the transfer of possession of the vehicle to the customer. However, the General Assembly added IC 9-14.13-3 effective July 1, 2016, which established a separate “convenience fee” that allowed dealers to charge for performing the services that have historically been excluded from the retail unitary transaction and represented by the documentation fee. As such, fees that meet the definition of a separately stated “convenience fee” are not subject to sales tax. While dealers may still charge a separate documentation fee in addition to the convenience fee, the services attributable to documentation fees will be considered to be charges by the seller for services necessary to complete the sale per IC 6-2.5-1-5(a)(3) and will be subject to sales tax.
On March 6, 2019, there was a printing issue with Indiana Certificates of Title. On the back of titles printed on this date, the odometer digit boxes and the Seller and Purchaser Information boxes may have faded or missing lines in them.
The alignment of the reassignment boxes may be skewed as well.
If a customer presents a title with faded, missing, or skewed lines on the back of it and the issue date on the title is March 6, 2019, dealers may accept these titles and make reassignments as normal.
The BMV will also replace misprinted titles at no charge at the vehicle owner’s request.
For any questions, email the Titles Department at bmvtitlesandreg@bmv.in.gov.
Amends parts of the Indiana Uniform Consumer Credit Code (“IUCCC”) concerning permitted additional charges. The IUCCC is administered by the Department of Financial Institutions (“Department”). The passage of this legislation is effective on July 1, 2018 and makes significant changes to the historical approach regarding these products and the approval given to Indiana Approved Guaranteed Asset/Auto Protection (“GAP”) and Debt Cancellation (“DC”) Administrators by the Department.
Historically, the Department has reviewed and approved third-party administrators of such non-insurance products as GAP and DC. In approving the administrators, the Department has also historically approved the GAP agreements. These approvals were made by the Members of the Department under the authority granted them by Ind. Code §24-4.5-2/3-202. With the passage of HEA 1397, these charges will no longer be separately approved by the Members but rather permitted explicitly in statute.
A GAP Waiver sold after June 30, 2018, that does not meet all of the conditions outlined in the IUCCC may be treated by the creditor as a prepaid finance charge and included in the total finance charge, provided maximum credit service/finance charges permitted by Ind. Code §24-4.5 are not exceeded. If a GAP Waiver does not meet the required conditions and is not treated by the creditor as a finance charge, charges for such waivers will be treated during examinations as impermissible additional charges with full refunds due to consumers.
The following changes are effective July 1, 2018.
Sellers, including auto dealers, will not need specific approval from the Department to sell GAP.
However, sellers must comply with Ind. Code §24-4.5-2/3-202 as applicable.
No confirmation is required whether a GAP Administrator has been approved; however, a seller must ensure GAP programs that are sold strictly comply with Ind. Code §24-4.5-2/3-202 as applicable. Selling a product that does not comply with the statute could result in full refunds to customers.
Maximum customer cost of a non-refundable GAP Waiver is $400 as noted in the statute. This amount will no longer be tied to inflation and can only be adjusted through future legislative changes.
Any GAP Waiver agreements entered into after June 30, 2018 will have no maximum consumer cost for refundable waivers. Any waiver sold after this date with a consumer cost in excess of $400 must be refundable using a method no less favorable to customer than pro-rata basis.
For GAP programs with a customer cost greater than $400, a rule of 78ths refund method is not permissible for agreements entered into after June 30, 2018.
Credit sellers who are registered under Chapter 2 of the IUCCC must continue to maintain an electronic database regarding sales and refunds of GAP Waivers.
Sellers of refundable GAP Waivers remain responsible for issuing timely refunds to consumers in the event of cancellation or prepayment in full. The Department will continue to review refunds as part of its examination process.
For a consumer related loan, a loan made by a lender that is not “regularly engaged”, the parties may contract for a loan finance charge, calculated according to the actuarial method, not to exceed 25% per year on the unpaid principal balance. This change results in consistent application regarding the finance charge permitted between consumer related loans and consumer related sales.
A creditor shall credit payment to a consumer’s account as of the date of receipt, except when a delay in crediting does not result in a finance charge or other charge, including a delinquency charge. A delay in posting is not a violation so long as the payment is credited as of the date of receipt. If a creditor specifies in writing requirements for the consumer to follow in making payments but accepts a payment that does not conform to the requirements, the creditor shall credit the payment within five (5) days of receipt of the payment.
The definition of “property” was amended by HEA 1397 to include property that a lessor holds complete and total ownership of, or ownership rights to. As a result, lessors who do not maintain inventory that could become subject to a rental purchase agreement must first obtain 100% ownership or ownership rights to the property from the retail merchant prior to entering into a rental purchase agreement with a consumer (“lessee”) for the property.
All lessors must maintain adequate books and records that demonstrate the lessor has acquired, prior to entering into a rental purchase agreement, complete and total ownership rights to the property subject to the rental purchase agreement. These changes add statutory clarification in line with the Consumer Credit Advisory Letter 2017-01 regarding RPAA Initial Payments.
Clarifications were added to Ind. Code §24-7-3-3 subsection (2) regarding the total number, total amount, and timing of all rental payment necessary to acquire ownership of the property. Any initial payment, not including the optional liability waiver and other optional products and services offered contemporaneously, must be included in the total.
Ind. Code §24-7-3-3 subsection (11) requires itemization of all charges and fees included in any initial rental payment.
An initial payment is separate and distinct from a regular rental payment; the legislation makes appropriate clarifications regarding this. HEA 1397 added a new section (Ind. Code § 24-7-4-1.5) regarding up-front or initial payments made by the lessee, regardless of to whom those payments are made.
Any upfront payment made at the time of (or before) a rental purchase agreement is entered into must be treated as an initial payment for the purposes of Ind. Code § 24-7.
As an initial payment, such monies are subject to all disclosure requirements of Ind. Code § 24-7 A Clarification was added that initial payments may be in a sum larger than a regular rental payment due under the rental purchase agreement.
Further clarifications were made that a lessor shall not require or permit a lessee to make any payment in addition to an initial rental payment and regular rental payments in order to acquire ownership of the property.
A lessor shall not require or permit a lessee to make any payment to a third party as a condition to entering into a rental purchase agreement.
If a lessee is liable to a lessor for the replacement cost of property subject to a rental purchase agreement, a lessor may not charge the lessee more than the fair market value for the property.
Pursuant to Ind. Code §24-7-5-10(b), the fair market value shall be determined by the lessor in the same manner, and using the same method, that would apply if the lessee were exercising an early purchase option under the rental purchase agreement.
The following change is effective July 1, 2018.
Retail creditors, non-mortgage lenders, licensed small loan lenders, rental purchase companies, and debt management companies may assess a non-sufficient funds fee not to exceed $25 and may be assessed by the Department for each returned payment of a dishonored check, electronic funds transfer, negotiable order of withdrawal, or share draft.
consumer credit sales2 that are retained in-house, commonly known as Buy-Here, Pay-Here ("BHPH")transactions.
precomputed transaction6; and restrictions on deficiency judgments in consumer credit sales7.
credit primarily for a business, a commercial, or an agricultural purpose are exempt. See Ind. Code §24-4.5-1 -202(b).
On 1-1-17 the length of time one can drive a newly purchased vehicle on Indiana roadways without registering the vehicle is increased from 30 to 45 days. Details are below.
For not more than 45 days after the date on which the person acquires the vehicle, a person who purchases a vehicle may display on the newly acquired vehicle a valid and unexpired license plate transferred from another vehicle that the person disposes of by sale or other means. While operating the newly acquired vehicle, the person must have in their possession a manufacturer’s certificate of origin, certificate of title, or a bill of sale.For not more than 45 days after the date on which the person acquires the vehicle from a licensed dealer, the person may display on the newly acquired vehicle a valid and unexpired temporary license plate that was issued by the licensed dealer. The law differs when a vehicle is purchased from a private citizen instead of a dealership.
An inspection station for purposes of emissions testing; or a BMV license branch or full or partial service provider to register the vehicle.While operating the vehicle, the person must have in their possession a certificate of title indicating that the person owns the vehicle.
As of 1-1-17 the Delinquent Fee will now be called Administrative Penalty. This applies to registering vehicles, off-road vehicles (ORV) and snowmobiles. The amount of the Administrative Penalty is changing. Indiana residents will be assessed an administrative penalty when registering a vehicle, ORV, or snowmobile more than 45 days after the date of purchase/acquisition. Non-residents of Indiana will be assessed an Administrative Penalty when registering a vehicle, ORV or snowmobile more than 60 days after becoming an Indiana resident. Administrative Penalty rules related to titles were effective on 7-1-16.
The Indiana Independent Automobile Dealers Association (IIADA) understood our member’s inability to provide customers with their title in 21 days and are pleased to announce that the law has changed!
The types and geographic locations of lenders, the geography of our customer base, mail delivery, and title processing have changed. These changes are the reason we educated and worked with our Legislature to make delivery of title time requirements more reflective of business conditions.
CUSTOMER FINANCING has become specialized with sub-prime financing making up the majority of the financing market. These companies along with credit unions, state and nationally chartered banks have given us the ability to meet the needs of our individual customers. However, the physical location of lenders can be most anywhere making it increasing difficult to get titles. This is in contrast to times when the majority of lending was underwritten by a local bank or credit union, who held the title in their safe, all located down the street from the dealership.
INTERNET PRESENCE is now as important as physical location to most dealers. Today’s customers are shopping your inventory online from other states and countries. Buying habits have changed from the times when the majority of vehicle sales came from a customer driving by the dealership to see your inventory or seeing an ad in the local paper. The logistics of delivering a title to a customer many states away increases the time needed to get the title to the customer.
*Indirect Retail Lenders – Lenders are continuously monitoring their dealers to make sure they are compliant and solvent.Floor Plan Inspections – Dealers who borrow money to finance their inventory are subject to regular inspection by their floor plan lenders.
Dealer Inspections – Dealers are subject to inspections by the Dealer Services Division under the Indiana Secretary of State Office.
Consumer Complaints – A bad “online review” can do a lot of damage to a dealer and his reputation. Indiana’s Attorney General investigates customer complaints against Indiana dealers.
Dealer Bonds – Dealers must maintain a $ 25,000 to ensure clear title.
WORKING TOGETHER we were able to get this legislation written and passed. Fritz Kreutzinger, IIADA Legislative Chairman, laid much of the ground work for this legislation through the Motor Vehicle Advisory Board meetings with the Indiana Secretary of State. THANK YOU to the legislators who listened and heard our concerns.
IIADA IS WORKING FOR YOU!
FOR MEMBERSHIP IN THE INDEPENDENT AUTO DEALERS ASSOCIATION PLEASE CALL: 800.310.3112 OR SEE APPLICATION ON WEBSITE.
The IRS raised the "safe harbor" threshold from $500 to $2,500 for expensing certain capital items that would have previously required capitalization and depreciation. Although the $2,500 threshold takes effect for the 2016 tax year, the IRS has indicated they will provide audit protection by not challenging the use of the $2,500 threshold in tax years prior to 2016. This can be interpreted to mean businesses may use $2,500 in the preparation of their 2015 tax returns.
This is great news for small business owners. As a result of this change, a small business may now immediately deduct expenditures up to $2,500 that previously would have been spread over a several year period. Common examples of such capital expenditures are notebooks, tablets, desktop computers, office equipment, office furniture, shop equipment and small tools.
One thing to be aware of with this change is that although the IRS is not requiring capitalization of assets under $2,500; these assets are still considered personal property by the local taxing authorities and will still be subject to tangible personal property tax. Business owners will need to develop a method of maintaining a listing of these assets for PPT reporting.
Somerset’s Dealership Team stays abreast of all changes impacting business owners. We believe a CPA should be proactive, not reactive. Contact a member of Somerset's Dealership Team today to discuss how we can partner with you!
Reach us by email at info@somersetcpas.com, or give us a call at 317-472-2183.
As of January 1, 2015, new laws went into effect regarding the licensing and registration of Motor Driven Cycles (MDC), previously referred to as motor scooter, mopeds and motorized bicycles. Licensing and registration requirements for MDCs can be found at the Bureau of Motor Vehicles website: www.in.gov/bmv/3220.htm.
Dealers of Motorcycles or MDCs who sell at least twelve (12) units per year are required to obtain a dealer license from the Indiana Secretary of State Dealer Services Division. Information regarding dealer licensing can be found at: www.in.gov/sos/dealer.
MDC dealers who sell units under 50cc can elect to become a licensed dealer.
Licensed motorcycle dealers can purchase interim motorcycle plates and request MDC-A or MDC-B decals from the Dealer Services Division, which will allow their properly licensed customers to operate their MDC prior to registering it with the Bureau of Motor Vehicles. To request MDC-A or MDC-B decals, please contact the Auto Dealer Services Division at 317-234-7190 or Dealers@sos.in.gov.
Effective July 1, 2014 dealers will charge sales tax at the buyer’s home state rate. This new law provides that the seller of a motor vehicle to a buyer who intends to transport and register the vehicle outside Indiana within 30 days of the sale will collect sales tax at the rate the purchaser would have paid in the state where the vehicle will be registered. The out-of-state sales tax rate charged is to include only the state sales tax, NOT any local County, or Jurisdictional sales taxes. All sales taxes collected will be remitted to the Indiana Department of Revenue.
Beginning with the July 2014 tax period, motor vehicle dealers should no longer use the current ST-103 return. A new Indiana sales tax return, ST-103CAR, has been developed specifically for motor vehicle retailers. You should begin using this return, either through INtax or another approved filing method, beginning with the July 2014 tax period. To update your return template to the ST-103CAR form, contact the Indiana Department of Revenue via the INtax message center, mail, or fax to (317) 232-1021.
Debbie Andersen, executive director of the Indiana Independent Automobile Dealers Association, was selected by her peers as NIADA’s 2012 Association Executive of the Year.
Andersen, has headed the IIADA since 2001 after serving six years as the association’s accountant, and has used her background as a CPA to put IIADA in a strong financial position.
"The association was going through hard economic times," said 2011 Executive of the Year Jim Mitchell of Ohio, who presented the award to Andersen during the 66th Annual NIADA Convention & Expo at Caesars Palace in Las Vegas.
"But today it is on solid financial ground and the association’s membership has grown to its highest level."
The winner is chosen by the executives of the state independent auto dealers associations nationwide.
"I’m very honored," Andersen said, "because it’s a selection by my peers, and to be honored by your peers, I think, is the ultimate in respect."
When Andersen took on the executive director job, she knew from her stint as IIADA’s accountant that getting association’s financial house in order would be her first order of business.
"I knew I was getting into a big financial mess," she said. "That’s why I was brought in to be the CPA in the first place. They were very financially challenged. When the executive director resigned, I thought, ‘Yeah, I’d kind of like to do that.’ And I truly enjoy it."
Andersen cut the association’s expenses and began using fundraising events to increase revenue without raising the members’ dues.
"We cut expenses immediately, and you look for other sources of income," she said. "It sounds simple, but we had to be creative. We had to think outside the box. Dues was not the place to go. We needed to raise money but we didn’t want to do it on the backs of the dealers. And, of course, we also slashed expenses. I didn’t spend if they didn’t have it."
Growing up in the Detroit area, Andersen has been around the car business and car people her entire life. While attending Northern Michigan University, she worked on the assembly line for Federal Mogul, a major parts supplier to auto manufacturers.
"I worked my way through college working in automotive factories," she said. "We made all the plastic parts, like the dash, on injection molding machines. They came off the assembly line and you had to trim all the plastic off of them."
Andersen said the biggest step she has seen IIADA take during her tenure has been in its relationship with the state government.
"We have grown tremendously in recognition within the state government<" she said. "Our state officials, from the governor to the secretary of state to the director of the bureau of motor vehicles, all look to the association now for advice and suggestions, which was not the case when I came on board 11 years ago.
"That is huge. That’s probably the thing I’m most proud of."
(INDIANAPOLIS) May 24, 2012– Secretary of State Connie Lawson is pleased to announce Indiana auto dealer plates are now linked to the National Law Enforcement Telecommunications System, a national database for law enforcement officers. Linking Indiana auto dealer plates to the national database provides law enforcement nationwide with access to real time information, greatly reducing the appeal of Indiana plates for illegal purposes.
Prior to this enhancement, law enforcement outside the state could look up an individual’s personal vehicle information, but were unable to access Indiana dealer plate data. Law enforcement can now access information on metal dealer plates used for dealership business such as test drives and paper temporary plates issued when a vehicle is sold. Law enforcement will use the enhancement to instantly access data in routine traffic stops and to solve crimes.
The Auto Dealers Services Division of the Secretary of State’s office worked with the Bureau of Motor Vehicles and the Indiana State Police to link to the national database.
Through the BMV and State Police systems, dealer plate and registration information makes its way to the national database.
§ Individual Mandate: Starting in 2014, everyone in the US must buy health insurance or will be subject to tax. Those who cannot afford to buy health insurance, (families at poverty level) will be subsidized by the government. Families making over $80,000 per year will not receive a subsidy. This provision was the heart of the lawsuit. The individual mandate goes hand-in-hand with the next provision; guaranteed issue. Making everyone buy insurance stops people from buying it only when they become sick.
§ Minimum Essential Coverage (MEC): This provision states that the government will regulate what plans will cover and not cover as a means to qualifying acceptable coverage. Having acceptable coverage means not facing fines/penalties. It is expected that the highest deductible for a single will be $2,000 and $4,000 for a family. This, however, could jeopardize Health Saving Accounts (HSA’s), which are linked to high-deductible health plans and are a popular option for the self-employed and for small businesses.
Mandatory new ordering program for Interim Plates became effective April 30, 2010 for all automotive dealers in Indiana. Through the Plates On-Demand program, automotive dealers access and print temporary plates online as they are needed instead of ordering the plates in bulk and having them shipped. A new temporary plate design is also part of the up-graded program.
Auto Search Technologies, Inc. is currently working on a project for IIADA members to increase online traffic to dealerships.
Auto Search Technologies, Inc. partnered with the NIADA as one of their newest member benefit providers.
Auto Search Technologies, Inc. (AST) is an automotive software engineering firm that creates innovative and highly advanced web technologies. AST was developed by software engineers, not marketing reps; therefore, giving us the needed tools and understanding of the strict requirements necessary to be found on the Internet and through the search engines (Google, Yahoo, MSN, AltaVista, AOL, etc). By utilizing this knowledge, all of our software is capable of presenting our dealers and their inventory to their potential customers and target audience within their desired demographic. Auto Search Technologies, Inc has developed both products (Auto Search Online) as well as numerous services (AutoHitList) to cater to all client needs. We combine science and art to give our clients the best online presence for their dealership and inventory.
Our products and services are cost effective and powerful. Through our exclusive SEO traffic targeting system, outstanding customer service, and affordable technologies our dealers are ranking above their competition all over the Internet. Best of all, we can prove it. Our team will take your dealership and bring it to life on the web, making your website one of your best and most cost effective marketing tools.
The Auto Search Online is a stand alone web application packed with SEO (Search Engine Optimization) that is dominating the top of the search engines (Google, Yahoo, MSN, AltaVista, AOL ...etc). This individual dealership website allows dealerships to list unlimited vehicles online with unlimited photos, with no monthly fees. The Auto Search Online allows dealers to be found by potential customers who are either looking for the vehicles on their lot, or whatever general search terms or phrases that they would like to be found under online.
The AutoHitList National Dealer Listing Network is a service developed to take online vehicle listings to the next level. In addition to having your inventory listed in www.AutoHitList.com, as part of the service we publish dealer inventory to thousands of website pages and websites all over the Internet without any additional data entry by just by being a member of the AutoHitList National Dealer Listing Network. Other Premium Services include eCommerce, Stock Image, News and Blogs, and much more.

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