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| *Loan,banking and credit>>>car tax |
Used car: cheaper to get tax, title-transfer, registration on it as a gift, or to pay a small amount (like $1) |
I live in Texas. A family friend has a 10-year old car he no longer drives, doesn't want to "give it away" as a trade-in...prefers to give it as a gift to me. Is it cheaper to accept it as a gift, or to buy for $1...how will the tax, title-transfer, and registration be affected by whether it's a gift or a cheap purchase? I offered to pay more; he says that $1 is fine. (It's a great car!)...I just need to know whether the tax office will work against me if it's a gift. In Texas it won't matter a hill of beans what you pay for it. When you go to transfer the title to your name they will look up what they call the "black book value" of the vehicle and will charge you taxes on 80% of that value. You can get an approximate value for the car at kbb.com I don't know where they get this black book value from, but that is what you pay taxes on. Source(s): Personal experience If it is a gift, there is no tax, you can't tax $0. The title transfer will cost you a little, but not bad. And you will have to pay for new plates. You may have to pay the property tax for the year, but that's not sales tax. It's sales tax you are trying to avoid. I'm in Utah, and I'm in the same situation as my father in law gave me a van recently, and that's how it worked here. |
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