taxes

Motor Vehicle Tax Guide

New Resident Tax

Tax Code Section 152.023, Tax on Motor Vehicle Brought Into State by New Texas Resident, imposes a $90 new resident tax on any motor vehicle purchased outside Texas and brought into Texas for use by a new resident. The new resident tax is imposed when the motor vehicle was previously registered in the new resident’s name in another state or foreign country. If a new resident leased a motor vehicle in another state or foreign country prior to entering Texas, and the lessor purchased the motor vehicle out of state, the new resident owes the new resident tax on the motor vehicle.

The $90 new resident tax is the new resident’s responsibility and must be paid within 30 calendar days from the vehicle’s first use in Texas (60 calendar days for active duty military personnel). The new resident pays the new resident tax to the county tax assessor-collector (CTAC) when the owner titles and/or registers the motor vehicle.

Any qualifying vehicle that a person brings into Texas within 30 days of becoming a new Texas resident is qualified for the new resident tax, by Comptroller policy. A vehicle documented to be in transit, but not arriving until after the 30 days, still qualifies. After a person resides in Texas for 30 days, a vehicle they bring into Texas is presumed to have been brought in after they became a Texas resident. The new resident tax does not apply, and the person owes the motor vehicle use tax on the purchase price or 80 percent of the standard presumptive value (SPV).

If a new resident has not previously registered the motor vehicle in their name in another state or foreign country, motor vehicle use tax applies. A motor vehicle leased out of state does not have to be titled to the lessee.

If the $90 new resident tax applies, the new resident does not receive any credit for motor vehicle tax paid to another state or foreign country.

New Resident Requirements

Motor Vehicle Sales Tax, Rule 3.71(b), Definition of "Resident" and "New Resident", defines a new resident, for motor vehicle tax purposes, as any person, firm, corporation or association moving into Texas with the intent to live or locate within the state. A natural person may demonstrate the necessary intent to live in the state by

• establishing a fixed dwelling;
• registering to vote; or
• demonstrating a legal or economic constraint to live in Texas.

A business entity may demonstrate the necessary intent to locate in the state by

• establishing a fixed place of business;
• advertising that it is located; or
• demonstrating a contractual obligation to locate in Texas.

A new resident may also be a resident of other states. Once residency is established in Texas, however, a person, firm, corporation or association may not subsequently become a new resident without showing that the residency formerly established in Texas was abandoned.

Motor Vehicles Previously Titled and Registered With Tax Paid in Texas

Another state may require a former Texas resident or a Texas resident living temporarily in another state to title a motor vehicle they had previously registered and paid motor vehicle tax on in Texas. There is no liability for additional motor vehicle tax when the resident returns to Texas with the same motor vehicle and presents a copy of a tax receipt or other document establishing that they previously titled or registered that motor vehicle in their name in Texas.

When the New Resident Tax Does Not Apply

The new resident tax does not apply when

• a Texas resident military member has Texas indicated as their home state of record;
• a motor vehicle is brought into Texas for public highway use by a person or firm already doing business in Texas; or
• a motor vehicle is apprehended for improper registration that is owned or operated by a person or firm domiciled or doing business in Texas.

For the situations above, the motor vehicles are subject to motor vehicle use tax. Applicants may submit documentation for credit towards legally imposed sales or use tax paid to another state, Puerto Rico and any U.S. possession or territory.

Antique Motor Vehicles

New residents who bring antique motor vehicles into Texas will pay the lesser of the $90 new resident tax or the motor vehicle use tax on the motor vehicle’s sales price. To qualify for this tax treatment, the motor vehicle must be at least 25 years old and a collector’s item, used exclusively for exhibitions, club activities or parades, and may not carry advertising.

Military Personnel

Military personnel moving to Texas owe either the new resident tax or the motor vehicle use tax.

Military personnel who are new residents to Texas (as demonstrated by having a home state of record in another state), and who bring a motor vehicle into Texas that was purchased and registered in the military member’s name in another state or foreign country, owe the new resident tax. If the new resident has not previously registered the motor vehicle in their name in another state or foreign country, then motor vehicle use tax applies.

Military personnel who are Texas residents (as demonstrated by having Texas as their home state of record) do not qualify for the new resident tax and owe motor vehicle use tax on vehicles purchased outside Texas and brought into Texas for use. Applicants may submit documentation for credit towards legally imposed sales or use tax paid to another state, Puerto Rico and any U.S. possession or territory.

96-254
(09/2021)