How to Complete Texas Form 50-246: Dealer’s Motor Vehicle Inventory Tax Statement

Texas Form 50-246, the Dealer’s Motor Vehicle Inventory Tax Statement, is the monthly filing licensed motor vehicle dealers use to report every vehicle sold from inventory and prepay property tax on those sales. The original goes to your county tax assessor-collector with payment, a copy goes to your county appraisal district, and both are due by the 10th of the month following the sales being reported.¹

Who Has to File

You file if you hold a general distinguishing number (GDN) from the Texas Department of Motor Vehicles under Chapter 503 of the Transportation Code, or if you qualify as an out-of-state dealer under Section 152.063(f) of the Tax Code. If you run a licensed retail car dealership in Texas, the requirement applies.²

A few categories sit outside the requirement: manufacturers and manufacturer-controlled entities, wholesale-only dealers whose GDN forbids retail sales, and small-volume dealers who sell no passenger vehicles described in Section 152.001(3)(A) and whose motor vehicle sales make up 25 percent or less of total revenue. The small-volume opt-out only works if you filed the required declaration with the chief appraiser and the collector by August 31 of the preceding tax year and render inventory the Chapter 22 way instead.

One point trips up new dealers: a month with zero sales still requires a filing. The statute obligates dealers to file “regardless of whether a motor vehicle is sold.”² Write “No Sales” or zero on the form and submit it anyway. Skipping the month triggers the same penalties as any other late filing.

Get Your Unit Property Tax Factor First

You cannot calculate what you owe without the unit property tax factor. The factor equals one-twelfth of the prior year’s aggregate tax rate for all taxing units that levy property taxes against your inventory at your business location on January 1 of the current year.² Aggregate rate means every taxing unit combined: county, city, school district, and any special districts.

Call your county tax assessor-collector or county appraisal district and ask for the current factor; the form’s instructions direct you to one of those offices.¹ If the rate is quoted in dollars per $100 of valuation, divide by $100, then divide by 12. You will multiply this factor against the sales price of every qualifying vehicle, so keep it where you can find it.

Filling Out the Form

Use the current form from the Texas Comptroller of Public Accounts. No substitute form is allowed.² The form moves through five steps.

Dealer Information

Enter the dealer’s full legal name, mailing address, city, state, ZIP code, and phone number, plus the name and title of whoever prepared the statement. The preparer does not have to be the owner. A business manager, comptroller, or any authorized employee can sign off.¹

Business Name and Physical Location

Give the business name (which can differ from the legal name), the physical street address, your property tax account number, your GDN, and your business start date if you were not operating on January 1 of the current year. The account number and GDN are what tie the filing to your property tax account and dealer license. Each location you operate files its own separate statement.¹

Vehicle Inventory Information

This is the body of the form. For each vehicle sold during the reporting month, log:

Date of sale.
Model year and make.
Full 17-character VIN.
Purchaser’s name as shown on the title application.
Type of sale, using one of four codes: MV for a standard motor vehicle sale, FL for a fleet transaction (five or more vehicles sold to the same buyer in one calendar year), DL for a sale to another licensed dealer, and SS for a subsequent sale (a dealer-financed vehicle resold from your inventory in the same calendar year).
Sales price, matching the amount on the Application for Texas Certificate of Title.
Unit property tax (UPT), which is the sales price multiplied by your unit property tax factor.

Do not assign a UPT to dealer sales, fleet transactions, or subsequent sales. Log the sale details for those, but leave the UPT at zero and note why no UPT applies.²

Totals

Add the number of units and total sales for each sale-type category (MV, FL, DL, SS). The total UPT across all qualifying sales is the amount you owe for the month.¹

Signature

Print your name, add your title, and sign on the last page. No notarization is required.¹ Read the attestation first. The form warns that a false statement can bring a Class A misdemeanor or state jail felony charge under Penal Code Section 37.10.

Where and When to Submit

File on or before the 10th day of each month, covering sales made in the prior month. If the 10th falls on a weekend or legal holiday, the deadline rolls to the next business day. Two offices receive the filing:

The county tax assessor-collector gets the original statement and your payment for the total UPT, usually by check, money order, or electronic funds transfer.
The county appraisal district gets a copy of the same statement.

Both offices must be in the county where your business is physically located.¹ Some counties offer electronic filing portals, so it is worth asking your county whether an online option exists.

If you were not in business on January 1 of the current year, you owe no inventory tax for that year and may not assign a UPT to any vehicle sold. You still file the monthly statement, but you submit it with a zero payment.²

Penalties for Filing Late or Not at All

Two penalties stack. The first is criminal: failing to file is a misdemeanor punishable by a fine of up to $100, and each day late is a separate violation, so a filing 30 days late could in theory generate up to $3,000 in fines. The second is a civil forfeiture of $500 for each month or partial month the statement remains overdue. Both are stated on the form itself.¹

One missed month alone costs the $500 forfeiture plus the daily fines. Several missed months compound quickly, and persistent noncompliance can draw attention from the appraisal district and put your dealer license at risk.

How the Prepayments Are Applied

The money you remit each month sits in an escrow account held by the county tax assessor-collector. The collector does not apply it to your tax bill in real time. After year-end, the collector distributes the escrowed funds to the appropriate taxing units. Excess funds are returned or credited rather than carried forward to the next tax year.

So your monthly UPT payments function as estimated prepayments against the annual property tax levied on your inventory. If prepayments exceed the levy, you get the difference back. If they fall short, you owe the balance. Clean monthly records are the only reliable way to see how your escrow balance is tracking against the anticipated tax bill, which is also what you will want on hand if the appraisal district audits your filings.

1
Texas Comptroller of Public Accounts. Dealer’s Motor Vehicle Inventory Tax Statement Form 50-246
2
State of Texas. Texas Tax Code 23.122 – Prepayment of Taxes by Certain Taxpayers