Sales and Use Tax for the Sale of Pre-Owned Manufactured Homes

As a unique blend of vehicle and house, mobile homes involve a complex set of rules when it comes to taxes. Here, we will provide a brief overview of the sales and use tax rules impacting mobile homes. However, if you have further questions about your sales liability for a new or used mobile home, be sure to speak with a trusted advisor like an accountant, financial advisor, or attorney who is familiar with the California laws to ensure you are properly complying with your tax obligations. 

The Rules 

In California, mobile homes were once taxed as vehicles. But after the law changed in 1979, mobile homes sold after July 1, 1980 were subjected to property taxes rather than vehicle license and registration fees. Each county calculates and collects property taxes and subjects them to state regulations and restrictions. 

There are some differences, however, based on where your mobile home is located. If you own the underlying land, you’ll be charged property taxes. On the other hand, if your home sits on rented land or in a mobile home park, you’ll be liable for taxes based on the value of your home’s structure, rather than for the value of the land on which it sits.  

In addition to property tax, mobile home owners are also charged use tax in cases where sales tax would apply. Use tax refers simply to a tax the government imposes on property owners for the use and enjoyment of their property. Typically, use tax is assessed and paid separately from typical property tax. 

The Exceptions 

Generally, sales and use tax do not apply to the sale of used mobile homes that are considered real property in California (and would otherwise be subject to property taxes). According to the State of California, a “used” mobile home is defined as one that has been “previously sold and registered or titled with any of the following: 1) the Department of Housing and Community Development (HCD) or with an appropriate agency or authority; 2) any other state, the District of Columbia, or a territory or possession of the United States; 3) a foreign state, province, or country.” A new mobile home does not fit this definition and thus does implicate sales and use tax.  

Conversely, property tax applies to used mobile homes that are located on a permanent foundation IF they meet the following requirements: 1) The home was originally sold new on or after July 1, 1980, or 2) it was originally sold new before July 1, 1980, and later transferred to the property tax rolls. 

There are a few other exceptions, for instance, if you buy your mobile home from a family member, you may be exempt from paying tax. If you claim an exemption in this situation, you will need to provide proof of your family relationship with the seller when you register your mobile home. 

If you’d like to learn more about your tax liability for your used or new mobile home, be sure to reach out to an experienced accountant or attorney. If you’d like to explore how Harmony Communities can help you find a place to call home, we would love to hear from you. 

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At Harmony Communities, we feel strongly that each resident has a sense of home. That they come home from work and feel pride in their environment and in their place in the greater community. That families are comfortable raising children in our neighborhoods, and that couples and singles know that they belong to something bigger than their four walls. In other words, we seek to create harmony within each community, making our communities not just passable, but peaceful, safe, functional, and beautiful.