SN 99(5)

Sales of Motor Vehicles to Nonresident Military Personnel and Joint Sales of Motor Vehicles to Nonresident Military Personnel and Their Spouses

This publication has been superseded by PS 2001(4)

PURPOSE: This Special Notice describes the procedures for nonresident members of the armed forces of the United States who are on full-time active duty in Connecticut to purchase motor vehicles at the reduced sales and use tax rate of 4.5%. This Special Notice also explains the procedures for nonresident military personnel and their spouses to jointly purchase motor vehicles at the reduced rate of 4.5%.

BACKROUND: Previously only nonresident military personnel on full-time active duty in Connecticut could purchase motor vehicles at the 4.5% sales and use tax rate. Recently enacted legislation extends the 4.5% sales and use tax rate to sales of motor vehicles made jointly to nonresident military personnel and their spouses.

EFFECTIVE DATE: Applicable to sales of motor vehicles occurring on or after October 1, 1998.

STATUTORY AUTHORITY: Conn. Gen. Stat. §§12-408(1) and 12-411(1), as amended by 1998 Conn. Pub. Acts 244, §§17 and 18.

DEFINITIONS: For the statutory provisions discussed in this Special Notice, the following definitions apply

Members of the Armed Forces of the United States. Members of the armed forces of the United States include individuals in the Army, Navy, Air Force, Marine Corps and Coast Guard

Resident of Another State. A member of the armed forces of the United States on full-time active duty in Connecticut must be considered a resident of another state under 50 U.S.C. app. §574 to qualify for the 4.5% sales and use tax rate.

Full-Time Active Duty. Full-time active duty includes persons in military service assigned to active duty in Connecticut. Full-time active duty does not include military personnel who are called to active duty for a portion of a year, such as reservists or national guardsmen

Motor Vehicle. A motor vehicle means any vehicle propelled or drawn by any nonmuscular power suitable for operation on a highway, as further defined in Conn. Gen. Stat. §14-1(a)(47). Motor vehicles do not include such items as aircraft, motor boats, golf carts, snowmobiles and lawn mowers.

REDUCED RATE OF TAX: Most sales of tangible personal property, including motor vehicles, are subject to 6% sales and use taxes. Members of the armed forces of the United States who are stationed in Connecticut on full-time active duty and are residents of another state may purchase motor vehicles at a reduced rate of 4.5%. Nonresident military personnel may also jointly purchase motor vehicles with their spouses at the 4.5% rate.

Members of the armed forces of the United States must provide proof to the motor vehicle dealer that they are not Connecticut residents and that they are on full-time active duty in Connecticut.

REQUIREMENTS FOR MILITARY PERSONNEL TO PURCHASE MOTOR VEHICLES AT THE 4.5% SALES AND USE TAX RATE:

The member of the armed forces of the United States who is purchasing the motor vehicle must provide the motor vehicle dealer with documents that prove the requirements to purchase a motor vehicle at the 4.5% sales and use tax rate have been met.

• The purchaser must provide the motor vehicle dealer with military enlistment papers or a signed letter from a commanding officer on military letterhead. The letter must include the name and address of the purchaser and must contain a statement that the purchaser is on full-time active duty at a duty station in Connecticut.
• The purchaser must give the motor vehicle dealer a copy of the last Leave and Earnings Statement issued. This statement shows the purchaser’s state of residence or home of record. A copy of the most recent personal income tax return filed with the state of residence and a copy of a motor vehicle operator’s license issued by the state of residence can also be used to substantiate permanent residency in another state.
• The purchaser must give the motor vehicle dealer a properly completed Affidavit SUT-16a-7, State of Connecticut Department of Revenue Services Exemption Certificate — Vehicle Purchased by Nonresident Member of the Armed Forces Stationed in This State.

ADDITIONAL REQUIREMENTS FOR MEMBERS OF THE ARMED FORCES OF THE UNITED STATES TO PURCHASE MOTOR VEHICLES JOINTLY WITH THEIR SPOUSES AT THE 4.5% RATE:

A member of the armed forces of the United States and his or her spouse must provide the motor vehicle dealer with one of the following documents to jointly purchase a motor vehicle at the 4.5% rate:

• a copy of their marriage certificate, or
• a copy of their most recent federal income tax return filed with the Internal Revenue Service showing the box checked under filing status as "married filing joint return" or "married filing separate return."

The military spouse must also provide the required documentation discussed in the previous section

EFFECT OF STATUTORY CHANGE ON EXISTING REGULATION: This Special Notice modifies and supersedes Conn. Agencies Regs. §12-426-16a(e)(5).

EFFECT ON OTHER DOCUMENTS: This Special Notice revokes Bulletin 21, Rev. 8/4/89, Retail Sales of Vehicles to Nonresident Military Personnel.

EFFECT OF THIS DOCUMENT: A Special Notice is a document that announces a new policy or practice in response to changes in State or federal laws or regulations or to judicial decisions. A Special Notice indicates the Department’s informal interpretation of Connecticut tax law and may be referred to for general guidance by taxpayers or tax practitioners.

FOR FURTHER INFORMATION: Please call the Department of Revenue Services during business hours, 8:00 a.m. to 5:00 p.m., Monday through Friday:

• 1-800-382-9463
(toll-free from within Connecticut), or
• 860-297-5962
(anywhere).
• TTY, TDD and Text Telephone users only
may transmit inquiries 24 hours a day by calling 860-297-4911.         

SN 99(5)
Sales and Use Tax
Sales of Motor Vehicles to Nonresident Military Personnel
Issued 04/14/99