taxes

Motor Vehicle Tax Guide

Interstate Motor Vehicles

Tractors, trucks, and truck tractors (pulling units) registered with apportioned plates under the International Registration Plan (IRP) are exempt from motor vehicle tax when the vehicles are either purchased in Texas or are purchased out of state and registration fees are apportioned into Texas. Trailers pulled by apportioned tractors and operated interstate also qualify for the exemption.

An interstate motor vehicle means a motor vehicle that is operated in this state and another state or country and for which registration fees could be apportioned if the motor vehicle were registered in a state or province of a country that is a member of the IRP. The term includes a bus used in transportation of chartered parties if the bus meets all the standards required of other motor vehicles for apportioned registration fees. The term does not include a vehicle leased for less than 181 days or a vehicle that has Texas license plates and does not operate under the IRP.

Units rented by contract for 180 days or less continue to be subject to motor vehicle rental tax.

To claim interstate exemption, the title applicant should indicate "for interstate use" in Box 38 of Form 130-U, Application for Texas Title and/or Registration (PDF), and list the statutory reference for this exemption.

Cancellation of Apportioned Registration

Any unit diverted from interstate use within one year of purchase in Texas loses the exemption. Any unit purchased outside of Texas with registration apportioned in Texas that is diverted from interstate use within one year of entry into Texas also loses the exemption. Obtaining non-apportioned registration may be evidence of a unit being diverted. The IRP cab card(s) will also indicate use in Texas.

The county tax assessor-collector will collect motor vehicle tax at the time of titling and/or registration, based on the original sales price of the vehicle. There is no credit given for depreciation or time operated with an apportioned tag.

Leased trucks and trailers, regardless of when they are removed from interstate use, will pay motor vehicle tax. The owner is responsible for remitting the tax directly to the Comptroller’s office. The motor vehicle tax is based on the lessor’s book value.

Texas Emissions Reduction Plan (TERP) Registration Surcharge

IRP trucks with apportioned plates pay 10 percent of the registration fee for the Texas Emissions Reduction Plan (TERP) annually. The Registration and Titling System (RTS) accounts for this 10 percent registration surcharge that is remitted to the Comptroller’s office.

96-254
(09/2021)