Do you have to pay taxes on a gifted car in California

Ask the DMV: No sales tax when it's a gift to immediate familyBy Chuck HollisSpecial to The JournalView CommentsView CommentsQ: I bought a car for my son several years ago when he

Do you have to pay taxes on a gifted car in California

Ask the DMV: No sales tax when it's a gift to immediate familyBy Chuck HollisSpecial to The JournalView CommentsView Comments

Chuck Hollis

Q: I bought a car for my son several years ago when he was a minor. It is registered and owned by me.

Now that he is an adult and on his own, I would like to transfer the ownership and registration to him. Does my son have to pay a tax on the car when he transfers the ownership and registration? I am not having him pay me for the car.

Michael S., North Kingstown

A: There is no sales tax paid when you gift a vehicle to an immediate family member. In your gift letter to your son, please make sure you establish the relationship between you two and make sure there is no amount written. A gift is a gift. If you would also like to gift the plates that are on that vehicle to your son, please include that in the gift letter too. If not, we will get him new plates when he transfer the registration into his name.

Besides the gift letter from you, your son will also need a completed TR-1 form, a Sales or Use Tax Exemption Certificate (hell check off Other and write Gift from Father to Son), the title if the vehicle is 2001 or newer or the previous registration if the vehicle is 2000 and older, valid and current Rhode Island insurance, and a form of payment.

Hell need to make a reservation at any DMV branch to do this transaction or he can drop off or mail all the completed paperwork with a signed check made out to the DMV and we will do the transaction that way. If he opts for the latter option, we will mail him his plates and registration certificate.

All forms and information, as well as instructions on how to make a reservation, can be found on our website at www.dmv.ri.gov.

Chuck Hollis is assistant administrator of the Rhode Island Division of Motor Vehicles. Please email your questions to  with Ask the DMV in the subject field.View CommentsView Comments

Video liên quan