Ask most car shoppers in 2026 and they'll tell you the same thing: the government finally made dealers put every fee in the advertised price. The rule they're thinking of was struck down. The requirement wasn't.

The federal rule everyone's thinking of — the FTC's Combating Auto Retail Scams ("CARS") Rule — was struck down in court before it ever took effect. But the FTC didn't drop the idea. It now says the FTC Act, the law it has enforced for decades, already requires an advertised car price to include every fee the dealer charges, and in 2026 it put that in writing for dealers. California, meanwhile, passed its own law, SB 766. Here's the real picture, from an automotive professional.

What the FTC's CARS Rule would have done

The Federal Trade Commission finalized the CARS Rule in December 2023. It was aggressive, and genuinely pro-consumer. It would have required dealers to:

  • Advertise a true "offering price" — the full price to buy the vehicle, excluding only government charges (tax and registration).
  • Stop charging for add-ons that provide no benefit — the classic example being a service plan that doesn't cover the car you're buying.
  • Get express, informed consent for every charge, and prove it.

If it had stuck, it would have been the single biggest change to car advertising in a generation.

Why it never took effect

Industry groups challenged the rule, and in January 2025 the U.S. Court of Appeals for the Fifth Circuit vacated it — not on the merits, but on procedure. The court held the FTC skipped a required step (an advance notice of proposed rulemaking) when it wrote the rule. The FTC subsequently withdrew it.

So there is no federal car-pricing rule in force today. That turned out not to be the end of the story.

What the FTC says now: no rule, same requirement

Without a rule, the FTC went back to Section 5 of the FTC Act, its general ban on deceptive and unfair practices. In March 2026 it sent warning letters to 97 auto dealership groups saying the price in an ad has to be the price consumers will actually pay, aside from required government charges like taxes, and listing "advertising a price that does not reflect all required fees" as illegal.

In September 2026, FTC staff published a pricing FAQ for auto dealers that spells it out:

  • Every fee the dealer requires goes in the advertised price. Only charges the government requires you to pay directly, such as taxes and registration, can be left out.
  • That includes the doc fee. The FTC's own example: a $40,000 car with an $85 doc fee has to be advertised at $40,085.
  • State doc fee rules don't change it. Where a state requires the doc fee to be disclosed separately, the dealer adds that disclosure, but the all-in price still has to be the most prominent number.
  • It covers every channel, from websites, social media and signs to phone calls and texts with the dealer's staff.

The FTC's consumer protection director made the same point to dealers in an April 2026 webinar: where federal and state law conflict, federal law wins. The FAQ is written by FTC staff, but the requirement it describes is the FTC Act itself, and the FTC is enforcing it. In 2026 it settled with Lindsay Automotive Group, alongside Maryland's Attorney General, and reached a $4 million settlement with Connecticut's Manchester City Nissan; both orders require the dealer to state the full price, mandatory fees included. The Lindsay order goes further than Maryland law, which lets dealers leave their processing charge out of advertised prices.

And then there's state law

States write their own advertising rules too, and they vary widely. The most consequential new one belongs to the country's biggest car market.

California's SB 766: the real all-in-price law

California enacted SB 766 (Chapter 354, Statutes of 2025), and it became operative on October 1, 2026. It does much of what people mistakenly credit to the FTC — but only in California. In plain terms, when a dealer advertises a specific vehicle or a monetary/financing term, the advertised price must be clear and conspicuous and must include dealer-installed accessories and hard add-ons. What it means for you:

  • No surprise "market adjustment" or "dealer prep." If it isn't in the advertised number, the dealer can't add it as a mandatory charge later.
  • Government fees are still separate. Sales tax and registration are excluded from the advertised total — those follow your ZIP code, not the dealer's ad.
  • The price goes in the first written reply. A dealer's first written response to you about a specific car has to state its total price. The dealer has to keep a copy for two years and give you one if you ask in writing.
  • Add-ons must be optional and beneficial. A dealer can't charge for a product you can't actually use (an oil-change plan on an EV is the textbook example), and optional products must be clearly labeled optional.
  • A three-day right to cancel on used vehicles bought or leased for $50,000 or less, as long as the car comes back in the same condition, apart from normal wear and tear, and hasn't been driven more than 400 miles since you signed. The dealer can't charge for the right, but it can keep a restocking fee of 1.5% of the price ($200 minimum, $600 maximum), plus $1 a mile over 250 miles, up to $150.
  • The price has to be real. A dealer can't misrepresent whether cars are available at the total price it gave you. That adds to rules California already had: an advertised car must actually be for sale or available from the manufacturer, and a sold car has to come out of ads within 48 hours.

It applies to licensed dealers selling vehicles under 10,000 lbs GVWR; wholesale sales, fleet sales and repeat commercial buyers are exempt. The law doesn't set penalties of its own. It's enforced through other California law, such as the Unfair Competition Law (Business & Professions Code §17200), under which the Attorney General and district attorneys can seek civil penalties.

The doc fee: federal law wins

Here's the wrinkle. California's own definition of the advertised total price, in SB 766 and Vehicle Code §11713.1, lets a dealer leave out the doc fee, the electronic filing fee and the smog check charge. It allows that; it doesn't require it. The doc fee is capped ($85 for dealers who e-file, $70 for those who don't).

A dealer has to obey federal law as well as state law, and federal law doesn't let those fees sit outside the advertised price. Since California only permits leaving them out, including them satisfies both. The FTC's September 2026 FAQ says any fee the dealer requires belongs in the advertised price, and that a state rule calling for a separate doc fee disclosure doesn't change that: the dealer includes the fee in the price and gives California's separate disclosure. So a California ad should show a price that already includes the doc fee, the electronic filing fee and, on a used car, the smog check charge, with only tax, registration and other government fees added on top. California's new-car dealers association now advises its members to do exactly that: one all-in advertised price with all three fees inside it. If an ad leaves them out, add them yourself; the number that matters is the real out-the-door total.

What this means when you're shopping

Strip away the regulatory noise and it comes down to one habit: never negotiate against a number that isn't the out-the-door total. An advertised price — even a fully SB 766-compliant one — still won't include your sales tax or registration, because those depend on where you live. And not every dealer follows the FTC's guidance yet, so what an ad includes still varies from one dealer to the next.

That's the whole reason this site exists. Put in the vehicle price and your ZIP code and our out-the-door calculator computes the real total — tax at your actual local rate, registration, the doc fee cap or benchmark for your state, and every government surcharge — with each line labeled so you can see what's mandatory and what's dealer profit. If you're in California, the California OTD guide walks through exactly how the state's rules apply to your deal.

The rules will keep shifting. The math won't. Know your out-the-door number before you walk in, and no advertising change — or lack of one — can catch you off guard.