Texas Used Car Sales Tax and Fees (Revised 2024)
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Buying and Selling Used Cars in Texas
While prices for used cars skyrocketed in 2021 and 2022 due to supply chain issues, they finally took a welcome dip in 2023 and 2024 — and the Texas used car market is hot. Whether you're planning to upgrade your pickup or try out an EV, it's a good idea to factor in sales tax and other fees beforehand to determine how much you can afford to pay for your new ride.
We've compiled a list of taxes and fees you'll encounter in Texas. Keep in mind that sales tax rates and fees change periodically, so it's a good idea to ask your dealer or check with the DMV to confirm the amounts you'll owe.
Texans will pay 6.25% in tax when purchasing a car from dealers or private parties.
Texas DMV and State Fees
| Item | Cost | Details |
|---|---|---|
| Texas sales tax | 6.25% of the vehicle's purchase price or Standard Presumptive Value (SPV) | The Texas sales tax is due on all vehicles purchased from dealers or private parties. |
| Use tax | 6.25% of the sales price or SPV | The Texas use tax applies to residents who purchase their vehicle in another state. Vehicle owners pay only the sales or the use tax, not both. You can take a credit for any sales taxes paid in other states. |
| Even exchange tax | $5 | A $5 tax applies to vehicles purchased using an even exchange (such as trading the vehicle for another of similar value). The recipient and seller may be exempt from Texas sales or use tax. |
| Gift tax | $10 | A $10 tax applies to vehicles gifted to a relative or nonprofit. The recipient and seller may be exempt from Texas sales or use tax. |
| Title transfer fee | $28 / $33 | The fee varies based on the Texas county you reside in. Your county tax assessor will identify the correct fee. |
| Title transfer fee | $2.50 | Collected when you apply for a Texas title or registration |
| Registration fee | $51.75 | If the vehicle doesn't have a current registration, you must request a new one at the DMV. Larger vehicles, such as pickups, may pay a higher fee depending on their gross weight. |
| Vehicle registration for new residents | $90 | New Texas residents transferring their vehicles from another state may incur this fee when they apply for registration. |
| License plates/transfers | Free | Standard license plates are included in the Texas title and registration process. If you request specialized plates, you will incur a fee. If the vehicle already has plates, you can request the seller to transfer them to you for free. |
| Electric vehicle registration | $200 | Owners of electric vehicles must pay a special $200 annual registration fee. |
| Inspection fee | $7.50 | Paid at the time of registration |
| Inspection fee (station portion) | $7 | Paid to the service station that performs the vehicle's safety inspection |
| Emissions test | $11.50 - $25.50 | Some cities and counties require vehicles older than two years to undergo emissions testing. The cost of the test varies on your location. |
| Emissions tax | 1% / 2.5% of sales price | If you purchase a vehicle with a registered weight of over 14,000 pounds, you must pay an emissions tax. The tax is 1% for vehicles with a model year of 1997 or later and 2.5% for a model year of 1996 or older. It's due within 30 calendar days of purchase. |
Texas Dealership Fees
Additional fees may appear during the sales process if you buy your vehicle from a dealership in Texas.
| Item | Cost | Details |
|---|---|---|
| Documentation Fees | Varies | Some dealerships may charge an additional fee for registering, titling, and licensing the vehicle. There are no set limits on documentation fees. |
| Extended Warranty | Varies | If you purchase an extended warranty from a dealership, it will increase your vehicle's purchase price. Most dealerships will roll the extended warranty into your loan so it becomes part of your monthly payment. |
| Advertising Fee | Varies | Occasionally, dealerships try to recoup their marketing expenses by charging an advertising fee on used vehicles. You can usually negotiate advertising fees or ask the dealership to remove them. |
Texas Insurance Requirements
Texas law requires all drivers to have insurance before taking a vehicle on the road. A minimum liability coverage policy is necessary, but you may need to buy additional collision and comprehensive coverage if you have a loan.
Since insurance rates can vary widely from one provider to another, it's smart to shop around with different providers. Figure out what coverage you need, and request a quote from Texas insurers. Comparison shopping can help you lower insurance for used cars — potentially saving you hundreds of dollars annually.
Miscellaneous
If you purchase your used vehicle from a dealership, it may charge additional fees during the sales process.
| Item | Cost | Details |
|---|---|---|
| Vehicle history report | Varies | Reviewing a car's prior owner and accident history can alert you to any potential issues. You can request a vehicle history report from your dealership or obtain one through Carfax or AutoCheck for a fee. |
| Vehicle inspection | Varies | Texas requires an annual state inspection for most vehicles, which costs $7 from licensed providers. However, a comprehensive pre-purchase inspection can identify serious problems that need repair. |
Frequently Asked Questions
Do I pay tax when gifting a car in Texas?
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How do I avoid paying tax on a used car in Texas?
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Do you pay sales tax on private sales in Texas?
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Premiums are sourced from over 30,000 zip codes across 200 insurance companies. We estimate premiums based on public filings for policies seeking 50/100 in liability with $500 deductibles for collision and comprehensive coverage. Estimated rates are based on a 35-year-old single female with a good credit score and no history of accidents or violations driving a 2023 Toyota RAV4 LE. We partner with Quadrant Information Services to source our data and assume no unique benefits or discounts are applied for these rates (unless otherwise stated). Your own rates may be different.