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Glenn Hegar
Texas Comptroller of Public Accounts
Glenn Hegar
Texas Comptroller of Public Accounts
Glenn Hegar
Texas Comptroller of Public Accounts

taxes

Motor Vehicle Tax Guide

Community Property

A transfer between spouses of a motor vehicle that is community property, for which Texas motor vehicle tax has already been paid, is not subject to either gift tax or motor vehicle tax. All property acquired during a marriage is presumed to be community property.

Since Texas recognizes an informal marriage, commonly referred to as common-law marriage, community property laws also apply in such cases.

Property Settlement and Divorce Decree

A transfer between persons formerly married to each other is exempt from both gift tax and motor vehicle tax when the transfer is part of the property settlement or results from a court-ordered division of community property in a divorce decree.

Taxable Transfers

Transfer That is Separate Property

A transfer between spouses of a motor vehicle that is separate property is subject to either gift tax or motor vehicle tax (see bullet points below). Separate property includes any property owned by a spouse before the marriage or acquired during the marriage by gift or inheritance.

  • A transfer to a spouse for no consideration is subject to gift tax.
  • A transfer to a spouse for consideration is subject to motor vehicle tax. Motor vehicle tax is due on the greater of the sales price (including a lien assumption) or 80 percent of the motor vehicle’s standard presumptive value (SPV).

Transfer Between Formerly Married Persons

A transfer between persons formerly married to each other is subject to motor vehicle tax when the transfer occurs after (and is not a part of) the community property settlement or court-ordered division of community property in a divorce decree. Motor vehicle tax is due on the greater of the sales price or 80 percent of the motor vehicle’s SPV.

Transfer Upon Death of Spouse

The transfer of a motor vehicle after the death of either spouse terminates the community estate that arose during the marriage. Therefore, any interest in the motor vehicles belonging to the decedent spouse’s estate is subject to the gift tax.


96-254
(09/2021)

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