amongmany

I believe the "gift tax" in TX is a whopping $10. When I "sold" my Xterra to my younger brother, all he had to pay was the $10 gift fee and then the standard registration fees (I think they were about $35). Saved him a good ~$700 on taxes.

switchcars

it depends on the state....some states (like NC) don't require ANY sales tax if the vehicle is sold private party. States like Maine take the higher of either the value or the selling price.

Regardless, sales tax is his concern, paid when he registers it at the BMV. Write out the bill of sale for the amount you're selling it, don't try anything shifty. You won't gain anything, but you would lose if somebody caught it.

Grrnmo

And some states go even FURTHER...in Virginia, for instance, the DMV computers have a formula built in that compares the "selling price" on the title or bill of sale to the book value.

If it isn't within a "reasonable" limit (and good luck trying to find how they define "reasonable") then you have to provide written proof of why the car sold for so little or pay the tax based on the base-model book value. For instance, I had to prove that I put a new TDI engine in a '99 VW Jetta - which is why I only paid $1500 for the car...the good news was I DIDN'T have to pay DMV sales tax on the $4800 motor!!!

The DMV knows people lo-ball them...they loook for different color ink on the price area of the title vs. the rest of the writing, etc...

Big brother wants his $$$, understands people try to get around paying it, and is willing to accept that if they don't go TOO FAR around them!

texasjohn

I certainly wouldn't take the risk to save a few hundred bucks.

If you want to cheat the system then there are other ways of saving a little bit of sales tax. IIRC, there is a box you can tick to say the car was a gift (in which case you would pay a $10 'gift fee' in TX), you can be creative with the sales price, etc, but only your friend will gain financially, as it is his sales tax to pay. However, I wouldn't condone those either, and certainly would not do them myself as my job is worth too much to me (I work in finance).

Like the poster above said, they might let you get away with a little bit below the book value, but take the piss and they will throw the book at you.

As they say, if you do the crime be prepared to do the time (and possibly look like goatse after your time in the can )

TR-S2K

Not in California. I "gave" my friend '91 Accord in 2000, the value of that Accord was $7k and all he paid at DMV was registration transfer fee less than $20. I can not say anything about other states gift taxes.