The Independent Dealer Podcast Feb 12, 2026

#418 - Tax Season Sales Tips for Car Dealers

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Jeep Compass

The Jeep Compass is a small SUV that looks cool and can handle rough roads, but it's also easy to drive around town. It's a good choice for people who want a car that can do a bit of everything, from going on adventures to running errands. Many people talk about it because it represents a fun and practical option for families or individuals.

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Toyota 4Runner

The Toyota 4Runner is a sturdy SUV that can go off-road and handle rough conditions. It's great for outdoor adventures and has a lot of space inside.

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Tesla Model

The Tesla Model Y is a fully electric SUV from Tesla. It's known for its roomy interior and high-tech features, making it a favorite for families and tech enthusiasts.

LIVE

Follow up, be aggressive.

You've got to be super aggressive.

I've said this, this statistic so many times

that 98% of tax refund customers spend,

what is it, 90% of tax refund customers

spend 98% of their tax refund within the first 48 hours.

Something to that effect.

It's a ridiculous number.

It's a ridiculous number, right?

So you've got to be super fast at follow up right now.

Lead comes in, lead needs to be called immediately.

Now we try to be in that five to 15 minute

response time anyway, with AI,

with people like Podium and things like this,

you can do that quicker.

But if you're doing it the old fashioned way,

what you should be, you should have something

that is set up to reach out immediately in a response,

but also your sales people need to be on the phone.

Hello and welcome to the independent dealer podcast.

Luke Godwin, how are you buddy?

I'm good, Jeff Watson, how are you today, bud?

Good, good, not bad, not bad.

I've got a 20 group coming up in two days.

You know, obviously it was smart of them

to pick Fort Myers in January.

It should be 80 degrees, it's gonna be 50 degrees.

So I'm a little perturbed, but whatever, still going.

Yeah, still going, it's 20 groups are a good thing, Jeff.

Yeah, it's smart, I'm stoked, it's a new group.

We combine with an existing group,

so we should have a full room.

Picking a meeting right at the middle of tax time,

I don't know, had a lot of homework I had to get done

for it, so I'm not super stoked about that

because I'm busy, I mean, we got W-2s flowing right now,

we got tax returns hitting.

It's kind of a stop and start type situation,

so I don't know if other dealers are seeing this

by the time this podcast airs, maybe.

It should be full blast by the next season.

But it seems like I've gotten these little spurts,

so it'll be busy for you and then it'll be crickets.

Yeah, we've seen the same thing on the retail side, Jeff.

Two weeks ago, I think when that first batch of free money,

whatever they call that, the refund,

the anticipated loans went out, man, it was,

that week was packed, but it slowed down the past two weeks.

But you know what, Jeff, we're gonna talk about tax season

today because we should be into thicker things.

And for buyer pay here stores and for retail dealers,

you gotta be on your game.

If you're not on your game, man, you're gonna miss out.

Okay, so let's talk about it.

We got six tips, six areas, six pieces of advice for you

to be focused on right now when we're in the midst

of tax season, right?

It's not just everything's just gonna work out fine

just because the W-2s are flowing.

It's still some stuff you need to do, Luke,

so walk us through this.

Yeah, so I think some dealers do that, Jeff.

They go, oh, it's tax season.

You know, maybe they did prepare going in,

but they forget to execute.

So what we're gonna talk about now is the execution

of tax season in tax season

because we're in it, guys and gals.

Number one, people forget this because you get so wrapped up

in the deals that are walking in the door.

But prior to that, Jeff, your salespeople

and your sales manager should mine your database.

You should go into your CRM and look at,

or in the dealer track, wherever you are,

look at your last 90 days and say,

who did we get approved that didn't show up?

Because a lot of times they didn't show

because they didn't have the down payment.

And who did we condition because they needed

a higher down payment that hasn't bought yet?

We need to work those leads, those approvals,

those conditions right now.

Do it today, stop what you're doing.

Yeah, yeah, you call them the handies, right?

Approve not delivered yet.

How many of those do you got sitting in your database

right now that would be great deals during tax time?

Yeah, and so when we look at this and we track our,

because of course you guys, you've got your scoreboards,

you're looking at your leads every single week,

you're looking at your applications approved,

or maybe deals written up,

and then you're looking at your deliveries

and you're looking at those percentages every single week.

And I noticed in the first week of January,

we had our application or our leads shot way up.

Yep.

Our applications did not, but our sales did good.

And I was like, oh, what a minute,

this doesn't make any sense.

We're cherry picking.

We had so many leads coming in

that these guys are not taking every lead to an application.

They're just doing the ones that were right in front of them.

They were the most anxious that we're bugging them.

And so they're just selling them

and they're letting all the other leads fall through the cracks.

Yeah, and you shouldn't.

You pay good money for those leads, Jeff.

Tax season does create new customers.

And it does it quickly.

So we forget about those old customers.

And a lot of those old customers,

their only problem was they didn't have enough down payment.

Yep.

Now they do.

That's not an objection at this point.

When you ask a customer for $2,500 down,

or $3,500 down, now they're like,

well, yeah, I just got $10,000 back from the government.

Of course I'll give you $3,500.

There's no objection.

They're low hanging fruit.

Most dealers aren't working them.

You got to go back.

You got to work them.

You got to get your people in your office doing it right now.

Yeah, that's what I'm going to do right when we get off this call.

Okay, Luke, what's tip number two?

Tip number two is, and this is really probably

more for buy here, pay here,

but every tax season when it came around, we tightened up.

And the reason we tightened up

is because we wanted to get the best of the best

of the people with tax checks.

You notice the thing in our industry,

because all those tax deals you do, they're not the best deals.

I can tell you that can be the case,

but it also, if you're very selective,

you get some of the best deals of the year during tax season.

Lower cash and deal, bigger down payments,

tighter terms and better customers,

but you've got to be selective.

Go up on your down payments.

If you're averaging $1,000 down or $1,500 down,

just go up 1,000 bucks.

Ask for it.

Ask differently than what you're currently doing.

Not saying that a down payment's going to make the deal, Jeff.

What I'm saying is be better at it.

Ask for more now because people have more.

Yeah, and I think the principle or the way it plays out

is with more down payment and unaffordable payment.

That's right, because that's the key to tax time

is it makes that car more affordable

in March, April, May, June, July, August.

They can still handle that payment.

You didn't overwrite them in the underwriting process.

Take a big down payment, put them in a massive monthly payment.

Then, of course, they're still going to go back

come August, September, October.

They can't afford it.

But just think about making the payment affordable.

Not only will you make the payment affordable,

if the repo does happen,

your loss on that repo is going to be less

because you got a bigger down payment, more than likely.

Now, of course, people are going to rent cars

and things like that.

But there's ways to use the bigger down payment

in tax season to shorten the term, lower the payments,

and lessen the repo on the backside.

Absolutely.

Don't get lazy.

And I thought we'd do that a lot during tax time.

We just see a down payment and we ignore all the other red flags

and we just roll it.

And a lot of those early season tax deals are those.

And you can tell the difference in the customer

who rushes out to get that pre-money, that loan money.

Because that loan money is expensive.

So they'll rush out and I've got a buy a car right now.

So they go to tax max or wherever

and they get that pre-money and they use it immediately.

Instead of waiting for three weeks

to get their actual tax check.

And so I think the people who actually wait

to get their tax check,

they're just a little more stable customer

than the early season customers.

Yeah.

And they're always the ones that your salesman

want to put in the brand news.

Oh, I rolled out the back

because it's the hottest car on the lot.

So you end up with these people who were already strapped.

They borrowed the refund advance

or maybe they got a loan on it.

And now they got them in too much truck

with too high of a payment.

And sure enough, recipe for disaster.

Oh yeah.

That's the hardest part I have

is it just seems like within the first couple of weeks

all the best of the best cars are gone to just anybody.

We don't really hold them over

for just getting the best applicant on that vehicle.

And most, what's funny is most people don't know

that the oldest car on your lot is the oldest car on your lot.

Most people don't know that.

Your sales people do.

And so make sure that we're putting

those early customers in the oldest piece.

Yeah, yeah.

Spiff it if you have to do something.

Okay, Luke, what's number three?

Well, it just leads right into that, Jeff.

The inventory reality check.

There's a lot of people that have cars on a lot

that it's had a birthday, Jeff.

I love that.

It's time to fix that problem.

And it's either we reduce the price so low

that it will retail.

Because if it hasn't retailed by now,

price is probably the number one objective.

Number two, if you don't wanna lower the price

for some reason in retail,

which I would recommend you do on it,

sell it at auction,

because it's gonna bring more at auction right now

than anywhere else.

So it's the time of the year to sell at the auction

if you're gonna sell at the auction, right?

Yeah.

Walk a lot, Jeff.

Get out there, get into cars, crank them up,

make sure they actually run,

re-detail them if you have to,

because now is the time of the year

to get rid of that old sale of the inventory.

If you don't, it's only gonna cost you way more money.

Yeah, and you say that, Luke,

this is a conversation we had before.

So to be, I mean, I look at mine,

and if I haven't got it running right, looking right,

before now, it's too late,

because guess what?

I got 30 new cars in the back

that also need to run right, look right.

My detailer's got eight keys that I'm waiting to get done.

So the thought of me being like, oh, that old age unit,

I probably should give it some attention

and get it re-detailed.

Dude, it's all it's gonna do

is make things worse and bog down, everybody.

So if you haven't done it by now,

it might be too late.

But what you can do is, it might be too late.

You can't get it priced wrong.

You can get it priced right,

and you can wholesale it at worse,

because even if you wholesale it for a loss now,

that loss is gonna be way less

than if you wait to July to sell it.

So it's time to get real inventory.

If you can't sell it in tax season, boys and girls,

you're gonna never sell.

It's just that simple.

We'll sell it next tax season, Luke.

Don't do that, Jim.

I sold the car last when you love this, Jeff.

It was our oldest unit.

We traded it in a Jeep Compass or something,

some little funky Jeep car to trade it in,

of course, on a forerunner.

And it was our oldest unit,

and nobody wanted this thing.

And it looked nice.

It was priced well.

We had gone from 12.8 to 8,900.

And then last week, about a week and a half ago,

I said, you know what?

We're gonna go back up to 10.8, and we sold it.

And it's the dangest thing in the world.

So play with the pricing right now.

Drop it real low for a couple of weeks,

and you'll know when the price gets really low

because the leads that come in on that car

will be super quick, right?

Just get lead after lead after lead.

Didn't even start inching up on the price.

So nobody said you can't go up.

Yeah, but you gotta get right.

They love that.

I love readjusting the price up on Facebook Marketplace

or somewhere where they message me individually,

they're like, hey, what are you doing?

You get all that?

Yeah, it's like, oh yeah, yeah, actually I can.

Yeah, I love that stuff.

We've got the same situation with cars.

The issue I ran into was I re,

I wrote down a bunch of my inventory,

you know, at the first of the year,

not a bunch, a couple, my age ones,

things that had been here for a full year.

And when I rewrite them, or you know,

I also read days in inventory then.

How you do?

Yeah, I don't know if that's right or wrong.

I just reset that clock.

How do you do that, Jeff?

I just read, I just update the purchase date.

And I just say, okay, it was purchased on December 31st,

2025, right?

So it resets the clock on the days in inventory.

So that mentally, it looks better be,

A, C, I don't have to pay an age spiff on it

that we do here,

because we pay, you know, 100 day, 200 day spiffs.

So I kind of lose track of those sometimes.

So when you say all this,

I'm looking out of my law right now and I'm thinking,

oh yeah, I do have a couple of those

that I need to get out there and drive them.

And when you give them attention,

they actually sell the next day.

It's really interesting.

Just drive it around for two or three days.

And all of a sudden, it's popular.

Yeah, actually, that's a really good idea.

If you give your salespeople demos

or whatever you want to call it,

or if you let people run to lunching cars,

make them drive those cars.

Any age unit, that's what you're driving, y'all.

You want them to drive the ones that just came out of recon

just to make sure there are no issues, right?

You want them doing that.

But the next thing you want them doing

is driving your old units

so that they can put their eyes on them,

get familiar with it.

They may have been walking around a car not driving it

and then get in the car and realize

they actually really like the car.

And when the salesperson really likes the car,

they sell the car.

Yeah, absolutely.

Okay, tip number four.

Follow up, be aggressive.

You've got to be super aggressive.

I've said this statistic so many times

that 98% of tax refund customers spend,

what is that?

Hold on, 90% of tax refund customers

spend 98% of their tax refund within the first 48 hours.

Something to that effect.

It's a ridiculous number.

It's a ridiculous number, right?

So you've got to be super fast at follow up right now.

Lead comes in, lead needs to be called immediately.

Now we try to be in that five to 15 minute response time

anyway with AI, with people like podium and things like this.

You can do that quicker with Neo, whoever.

You can do that really quickly.

But if you're doing it the old fashioned way,

what you should be, you should have something

that is set up to reach out immediately in a response,

but also yourselves people need to be on the phone,

calling them within five minutes.

If the doors are open, they should be calling it.

It's hard during tax season

because you've got so many walk-ins and things like that.

So make sure you set up,

make sure you have extra help this time of the year

to take those calls and make those calls.

Hey guys, just to jump in and talk about Buckeye risk services.

They've been one of our sponsors forever.

They're great to the industry.

They're one of your sponsors, you don't even know it.

Every time you go to a convention or something like that,

they're there helping out, isn't that right Jeff?

Yeah, absolutely.

I have not seen a company so willing

to get behind the dealers from an education,

from a support standpoint.

I mean, there's a handful that we see in our sphere

that are very active and always have our back,

but Buckeye really sets the standard.

So when you're looking for a reinsurance company,

if you've decided it's time to get into it,

you've got to call the guys and girls over at Buckeye.

I promise you will not regret it.

Yeah, reinsurance, force savings account, wealth building,

tax plan, all these things go together, so call Buckeye.

Yeah, and it's also explained to your sales team

that this isn't business as usual.

And that's what I try to remind these guys

in our meetings every single Monday, Tuesday, and Thursday

is there is no time.

This is eating your desk season.

This is don't chit chat with people season.

This is maybe stay a half hour late,

come in a half hour early season.

It is not business as usual.

This is Super Bowl.

So you've got to kick it into another gear,

which means you still have to sell one or two cars a day.

You still have to do 50 phone calls and 50 texts.

So don't tell me you were so busy selling a car

you didn't have time to get to follow up

because that's just not an option right now.

That's right, it's not an option.

You need to be setting the appointments today.

The conversation or the appointment setting,

she goes up like this,

are you able to come in now or within two hours, right?

Either or them very small

because you don't want to put them off till tomorrow

because they will go somewhere this afternoon and buy a car.

Absolutely.

Let's talk some specific buy here, pay here.

This tip you have, number five.

Yeah, if you came to my boot camp,

you probably will know this,

but tax season is very important to collections.

And everybody should know that if you're in the business.

It's a time to get those customers back on track

that were off track, right?

Your collectors should be taught

to ask for people's tax refund.

If they don't, if they just treated like regular old month

and the customers two months behind, you're losing out.

You should be getting,

the customers two months behind right now,

you should be getting two months payments.

And maybe a third month, get them paid a month ahead.

We have customers that come in all the time

and pay some, some pay six, seven, eight months ahead.

You gotta ask that, you gotta be trained to ask that.

And if you're not training your collectors

to ask those questions, they won't do it.

And they all know it's tax season,

but it's just, it's harder for them to ask an extra question

when you don't really need, it's not hard.

Hey, I know you got your tax refund,

you wanna go ahead and make two or three month payments?

The worst thing they can say is no.

Yeah.

That's the worst thing they could say.

So you think, so I also,

I'm a big fan of bonus senior collector

on collecting side notes.

So if you're a buy here, pay here that does side notes,

now is the time to say, hey,

you know, in the month of January, February, March,

I'm gonna share a percentage of every dollar

collected on side notes.

You know, we have $50,000 due to us in side notes.

So as much of that 50,000 as you collect,

you're gonna get, you know, X%, 10%, 5%,

whatever that number is that works for you,

because now you're putting the incentive,

you guys are aligning your incentives

for them to ask that extra question,

because they're not gonna ask it,

they're just trying to get the payment in, right?

Oh, great, my payment's good,

my delinquency looks right, my recency looks right,

but there's this whole other opportunity in pot of money

that unless it's built into your collector's pay plan,

they're fine ignoring it.

It needs to be trained on for one,

and if you wanna build it into your collector's pay plan,

that's fine too.

I think it's, make sure you're structuring

those type of side notes so that they are collectible,

and you know, you may even structure a side note

where it's all comes due

when somebody's tax money comes in.

So I think there's ways around that

to really make sure you're doing it,

because side notes are super important,

they keep the account current,

keep the account on the road,

and they protect your portfolio.

So I do believe that you gotta collect them,

but you gotta do it,

and you gotta have a plan in place.

So make sure that you do it right now.

That's a really interesting philosophy,

and I haven't thought about that,

but training your shop and your collectors

to say all side notes are due February 30th,

whatever that date is.

February 28th this year.

You know, all side notes are due on February 28th,

eight in full, so,

because we know 90% of our customers get a tax return.

So sure, you got that repair done

whenever we side noted it,

you're gonna make monthly payments,

and it will balloon pay and be due on the 28th of February

with your tax returns.

Kind of an interesting way to structure it upfront

for the customer.

Yeah, and remember this,

because tax season is huge for retail dealers

and buyer pay hear dealers,

but for tax, for buyer pay hear dealers,

it's not,

sales, tax season isn't about selling more cars.

It's a portfolio event.

It's to increase the size of your portfolio to grow,

but it's also to strengthen it.

Those deals that are hanging on, you can save them.

You can trade some people out.

You can get some balances paid off,

get people called up.

It's a portfolio event,

and I want you to think about it like that,

not just, hey, we're gonna sell more cars.

No, no, no, no.

We're gonna build our portfolio.

We're gonna make it stronger during those taxings.

And get more cash in the bank, really.

And get more cash in the bank.

Yeah, so you're putting out a lot of cash,

and I look at that all the time.

I'm like, oh, I gotta have the cash to supply the inventory

to do the buyer pay hear,

cover tax title license, repairs,

fund my reinsurance company,

if we have this big jump in sales.

So all these cash needs happen this time of year,

not to mention income tax.

But then you also have, okay, that means I need to get more,

which means more of my side notes,

more of my what's due, more of my past due,

and more down payment.

So I have less cash on the street.

So it all works out.

Yeah, I mean, most buyer pay hear dealers,

if you do this right, you could come out of tax season

in a better cash position than you ended the year in.

And that's really where you wanna be.

And you wanna make sure that you,

that you structure all your deals

and collect your portfolio properly

so that you are in that position.

Hey, real quick break to make sure you guys know

about BlitzPay.

It's who I use to take all the payments

at my buyer pay hear dealership.

We've been with them for almost three years now,

and it is absolutely amazing.

It's great.

Yeah, the product is so simple,

even an idiot like me can use it.

But you know, even when my collector's out,

and I'm just taking a phone call here or there,

no matter where I am, I can log into BlitzPay

and I can take that payment.

I can see the customer's texting in and say,

hey, can you run this?

Or whatever's going on, it's always on top of it.

And the money's in the bank almost the next day.

And that is, to me, so important.

And the support is great.

If we do have a chargeback or a dispute,

we get an email that says,

hey, there was this dispute.

And then their team goes to work to help us resolve it.

It doesn't, they don't just dump it back on your table

with some random notification or email

that you barely ever see, like my previous processors.

Yeah, it's so helpful.

And a lot of times it's because our customers

did something wrong.

But when it's not, they'll fight to the end with you

and get that money back into your account.

Yeah, so give them a call.

The guys and girls over at BlitzPay,

great partner to have, definitely an essential tool

to have if you're a Buy Here, Pay Here dealer.

Okay, let's wrap it up with one

I think is the most important tip for all dealers

is not letting this time of year break

your processes and best practices, right?

Yeah, it's super easy to do

because everybody's excited, they're selling cars.

Years ago, I can just remember us

being down to two cars in inventory, right?

And my dad would go to the auction,

he'd buy 10 or 15 cars at the auction.

We'd bring them in.

Dude, we wouldn't even take the stickers off, right?

And this was 20 years ago.

We wouldn't even take the stickers off and you'd sell.

What happened the next day, Joe?

Yeah, they come right back.

They come right back.

Or hey.

So if you don't follow the process right now,

you're gonna create a lot of headaches.

And that becomes with skipping inspections,

rushing paperwork and you gotta get people back in.

You know, all these things that can cause issues

will be caused, promise you.

We're getting down payments, we've done that before.

There's all kinds of things that you can do

because you're rushing.

Don't rush, slow down, be methodical, use the process.

It was built for a reason.

And you'll be the underwriting too.

You gotta go by your underwriting guidelines.

All these things.

Yeah, it's very easy to skip.

And I think the biggest headache for me is the inventory.

It's very easy for us to roll stuff out

that's not quite ready or hasn't been road tested

or hasn't been proven.

And all that does is creates a massive headache

for your shop come March and April.

And now they're backed up with customer cars

and we owe things and warranty items.

And all these things that could have been handled,

had you just prepped a little better,

had you not skipped steps.

Because like right now, yeah, I've got 30 cars in the back

that need to go through inspection and recon.

So we're pushing them through.

Yeah, my detailers are, you know,

I sent a video to a guy today of a sprinter we have.

The floors are dirty.

The roof is dirty.

Like they detailed it, but they didn't detail it, right?

And so now I'm like, oh, well,

and it's very possible this guy just jumps onto the next one

because this one looks so bad

that it's those little details that weren't taken care of.

And now I could have missed out on a sale.

Yeah, you need to be, if you are behind,

especially in detail department,

because sometimes this time of year,

your detail department starts slowing everything up.

Find a local detailer, get them in there,

get the cars through.

Your process isn't broken there, it's just expanded.

So don't be afraid to, as an owner, to go test drive cars.

And if you need to find a new shop

to help you during this time,

shops around this time of the year aren't all that backed up

because they're not working on air conditions

and the cars aren't running hot.

So find you another shop right around the corner

that you can do this with too.

You get those cars inspected, get them through,

get them to frontline, get them sold.

Oh yeah, yeah, we're using five outside shops.

And it just never seems to be enough.

Never seems to be enough, Jeff.

No, no, absolutely not.

All right, Luke, hey, all good advice, good tips.

I'm excited, I got a few things I know I need to go tackle.

It seems like it never ends.

There's not enough hours in the day right now.

But I'm gonna go out there and tackle a few of these things.

I want you up underneath cars, Jeff.

Changing oil, rotating tires.

You know, I did do a third row seat belt

in a Tesla Model Y today.

So that's kind of my specialty.

I handled most of the Tesla technical stuff.

So yes, yeah, my hands hurt, to say the least.

I was getting dirty, so.

Don't want to hurt those precious hands, Jeff.

Did you take those linens, line gloves off your hands?

Yeah, you know, I've actually been golfing so much lately

that I have these weird new calluses that have popped up.

So and I got to use that special like lotion, you know, the cream

because my hands are cracking.

It's real, it's utter cream.

Yeah, utter cream, I think that's what it's called.

So when when the grass gets green again, we're going to go golf

and I'm going to lose less balls than I did last time.

Also, well, until then, catch you later.

About this episode

Tax season is a critical time for car dealers, and this episode dives into essential strategies to maximize sales during this period. The hosts emphasize the importance of rapid follow-up on leads, leveraging tax refunds to close deals, and revisiting past customers who may now have the funds for a down payment. They discuss the need for dealers to be selective with inventory and pricing, ensuring that older cars are either sold at auction or priced competitively. With practical tips and insights, this episode equips dealers to capitalize on the tax season rush.

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Original notes

In this episode of the Independent Dealer Podcast, hosts Jeff Watson and Luke Godwin break down essential strategies for maximizing tax season sales at your dealership. Tax season is your biggest opportunity of the year—but only if you execute properly.

What You'll Learn:

How to mine your database for approved-but-not-delivered customers

Why increasing down payments during tax season creates better deals

Collection strategies to maximize cash flow when customers have money

Smart inventory management to avoid running out of stock

The importance of maintaining processes even when you're slammed

6 Tax Season Tips:

Mine your database for previous approvals and conditions

Tighten up and increase down payment requirements

Aggressively collect on your portfolio when customers have cash

Plan inventory ahead to avoid running out of cars

Manage cash flow carefully during high-volume sales periods