A new or used car is one of the largest purchases many people will make in their lifetimes, but the costs are almost always higher than the vehicle’s list price. Sales tax, fees, and tariffs add to the expense, and they aren’t always on buyers’ minds when they head to the dealership. This page helps explain some of the fees you might see during your next car purchase, and our in-depth articles detail what you need to know before you start shopping.

Destination Charges and Dealer Fees Explained

Every new car buyer pays a destination charge to cover delivery from the factory to the dealership. We break down which fees are negotiable, which aren’t, and how to spot bogus add-ons before you sign.

Tariffs on Cars and Parts: What You Need to Know

Tariffs of up to 25% on imported vehicles and car parts could add as much as $6,000 to the price of a new car. Here’s how to tell where your car is built and what tariffs mean for buyers and owners.

What Is a Doc Fee When Buying a Car?

Documentation fees can add hundreds to your final price, and the cap varies wildly by state. Learn what a doc fee actually covers, how much is reasonable, and how to negotiate the out-the-door price.

Pay it

Often-Required Fees

Government-mandated or contractually standard charges. These are not negotiable on the dollar amount, but you should always verify them.

Sales Tax
Set by your state (and sometimes county or city). Rates and rules vary widely – some states use excise or use taxes instead.
Doc Fee

Covers paperwork processing. Capped by law in some states; uncapped (and often padded) in others. Check your state’s limit.
Destination Fees

Set by the automaker to ship a new car from the factory to the dealer. Same price nationwide for a given model; not a dealer markup.
Registration & Title Fees

State charges to title the vehicle in your name and issue plates. Set by your DMV – the dealer just collects and remits them.

Push back

Negotiable or Unnecessary Fees

Dealer-added charges that pad profit. You can ask for them to be removed, reduced, or walk away if the seller insists.

Market Adjustments / Markups

Dealer-imposed premiums over MSRP on hot vehicles. Pure profit – shop around or wait for supply to normalize.
Dealer Prep or Reconditioning

Charges for washing, inspecting, or “preparing” the car. New-car prep is reimbursed by the automaker; used-car recon is a cost of doing business.
Accessory Packages / Upgrades

Pre-installed nitrogen, paint sealant, VIN etching, all-weather mats, etc. Often marked up 5-10x. Decline or negotiate to cost.
Extended Warranty / GAP

Optional F&I products. Useful for some buyers, but heavily marked up in the finance office. Always price-shop with your insurer or credit union first.

Things to Know About Taxes When Selling a Car

When you sell a car, the buyer is typically on the hook for sales tax at registration – but capital gains, gift, and donation rules can still bite the seller. Here’s what to watch for before you hand over the keys.

Are Taxes and Fees Included in Car Financing?

Dealer financing usually rolls sales tax and fees into your monthly payment, but private sales and outside lenders are a different story. Learn when taxes and fees get baked into your loan and when you’ll owe them at the DMV.

Things to Know About Taxes When Buying a Car

Sales tax, excise tax, use tax, and ad valorem tax can all show up on a car purchase, and rates swing wildly by state. Here’s a buyer’s primer on the four big taxes that drive up your out-the-door price.

Doc Fee Limits and Sales Tax by State

Choose a state to see whether it caps the documentation (“doc”) fee a car dealer can charge, the state-level vehicle sales or excise tax rate, and a direct link to the state’s official DMV or motor vehicle agency.

Select a state:

State Alabama

Doc Fee Cap No statutory cap

Status Uncapped

Vehicle Sales Tax 2.0%

Select a state above to view its documentation fee rules.

Official source: Visit state DMV website

Back to Our Paperwork Hub

Fees and Tariffs

Destination Charges and Dealer Fees Explained