Understanding The Tax Implications Of Car Title Transfers

As a trusted provider of car title transfer services in New Mexico, MVD Express understands the importance of helping our clients understand the tax implications of transferring a car title. Whether you are buying or selling a vehicle, it’s essential to know what taxes are involved in the process so you can plan accordingly. In this article, we’ll provide an overview of the tax implications of car title transfers and what you need to know.

Sales Tax

When you buy a vehicle, you may be required to pay sales tax on the purchase price. The amount of sales tax you’ll pay varies depending on the state, but it’s typically calculated as a percentage of the purchase price. It’s important to note that if you purchase a vehicle out-of-state, you may be required to pay sales tax in both the state of purchase and the state where you reside.

Personal Property Tax

In some states, you may be required to pay a personal property tax on your vehicle. This tax is calculated based on the value of the vehicle and is typically assessed annually.

Use Tax

If you purchase a vehicle out-of-state and bring it into your home state, you may be required to pay a use tax. This tax is similar to sales tax but is calculated based on the value of the vehicle rather than the purchase price.

Lien Fees

If there are any liens on the vehicle, you may be required to pay lien fees as part of the title transfer process. These fees are typically paid to the lienholder to release the lien and transfer ownership of the vehicle.

At MVD Express, our goal is to help make the title transfer process as smooth and stress-free as possible. We have a team of experts who can help you understand the tax implications of transferring a car title and assist you with all the necessary paperwork. Whether you are buying or selling a vehicle, we can help you get the information you need to make informed decisions.

If you have any questions about car title transfers or the tax implications of transferring a car title, we invite you to contact us at MVD Express. Our knowledgeable staff is always available to answer your questions and help you navigate the title transfer process.