How to Gift a Car in CT: Tax Exemption, DMV Steps, and Lien Rules

To gift a car in Connecticut, the donor signs over the title, both parties complete Form AU-463 (the Gift Declaration) and Form H-13B (the Registration and Title Application), and the recipient brings those forms, insurance, and ID to a DMV appointment. When it’s a genuine gift, or a transfer between spouses, parents and children, or siblings, the recipient pays administrative fees of roughly $199 and up but avoids Connecticut’s 6.35% sales and use tax entirely.

Who Qualifies for the Sales Tax Exemption

Connecticut has two separate paths to skip the sales tax, and they cover different situations.

The gift exemption applies to any true gift, regardless of relationship. The condition is strict: the donor receives nothing in return. No cash, no property, no services, no assumption of a loan or debt on the vehicle. Both parties sign Form AU-463 affirming this under penalty of law.¹ Any partial exchange of value turns it into a taxable sale in the DMV’s eyes.

The family transfer exemption under Connecticut General Statutes § 12-412(10) is broader in one important way: it applies even when money changes hands. It covers spouses (including civil union partners), parents and children (including through adoption), and siblings (including through adoption).² A parent can sell a car to a child at any price and still qualify. Grandparents, aunts, uncles, cousins, and in-laws do not qualify under the family exemption.¹ A gift to any of them can still be tax-free, but only through the gift exemption, which means no consideration at all.

The 60-Day Rule for Family Transfers

For a family transfer, the vehicle must have been registered in the donor’s name for at least 60 days before the transfer.³ If a parent bought a car last month and wants to hand it over next week, the family exemption doesn’t apply yet. Wait until the 60-day mark, or structure the transaction as a true gift with no consideration and file the AU-463.

When Neither Exemption Applies

If the transfer isn’t a genuine gift and doesn’t fit the family definition, the DMV treats it as a private sale. Sales tax is calculated at 6.35% of the NADA average trade-in value or the bill of sale amount, whichever is higher, and it’s due at the time of registration.¹

Documents to Bring to the DMV

Gather everything before scheduling the appointment. A missing form means a wasted trip.

Form AU-463, the Gift Declaration, signed by both donor and recipient, affirming that no cash, property, services, or debt assumption changed hands.⁴
Form H-13B, the Registration and Title Application. For a gift transfer, complete Section 5 on the front using exemption Code 1, category 5A, and attach the AU-463.⁵
The original Certificate of Title, with the donor’s assignment of ownership section completed on the back, including the odometer reading and signature. White-out, cross-outs, or illegible entries can invalidate the document, which forces the donor to request a duplicate title for $25 before the transfer can proceed.⁶
A Connecticut insurance card in the recipient’s name for the specific vehicle.
The donor’s most recent registration certificate for the vehicle.
Valid identification for the recipient.

Both forms are available on the DMV’s website. Fill them in, print them, and bring signed copies.⁷

Odometer Disclosure

Federal law requires the donor to record the odometer reading on the title assignment, with an age-based exemption. Vehicles from model year 2010 or earlier are exempt if the transfer occurs at least 10 years after January 1 of the model year. For model year 2011 and later, the window is 20 years.⁸ A 2006 sedan gifted in 2026 needs no odometer statement; a 2015 model still does.

If There’s Still a Lien on the Car

You can’t gift a car you don’t fully own. As long as a lienholder appears on the title, the DMV won’t process the transfer. The donor needs to pay off the loan and obtain a lien release from the lender, or arrange with the lender to have the lien discharged, then get a clean title showing no encumbrances.

Lenders don’t always issue releases quickly. If the release comes as a paper document rather than an electronic filing, the donor may need to bring it to the DMV for an updated title before the gift transfer can happen. Build extra time into the plan if the vehicle isn’t paid off.

Insurance the Recipient Needs Before Registration

The recipient must have an active Connecticut policy on the vehicle before the DMV will issue registration or plates.⁹ The donor’s insurance stops covering the car once possession changes, so the recipient should have coverage in place before taking the keys.

If the recipient already carries auto insurance, many insurers extend that coverage automatically to a newly acquired vehicle for a grace period of 7 to 30 days. That’s useful for bridging the day of the transfer, but it isn’t a substitute for adding the car to the policy promptly. Driving uninsured is illegal in Connecticut and creates personal liability from the first mile.

Connecticut uses electronic insurance verification, so the DMV can confirm coverage is active at the appointment. Without a verified policy, the state won’t issue plates or a registration certificate.

Emissions Testing

A valid emissions test is required before the DMV will register a vehicle, and this applies to gifted cars.¹⁰ Check the vehicle’s status at CTemissions.com before the appointment; the portal shows when the next test is due.¹¹

If a test is overdue, get it done before scheduling the DMV visit. A failed test means repairs and a retest before registration will go through. Vehicles four years old or newer are typically exempt from testing, but the recipient pays a $40 emissions exemption fee at registration in place of the test.⁶

Fees the Recipient Still Owes

Connecticut’s DMV runs registration services by appointment. Book online before visiting a branch; walk-ins face long waits or may be turned away.¹²

Sales tax may be waived, but administrative fees are not. For a standard passenger car, SUV, or van:⁶

Registration: $120
Title: $25
Administrative fee: $10
Plate fee: $5
Clean Air Act fee: $15
Passport to the Parks fee: $24
Lien fee (if applicable): $10
Emissions exemption fee (vehicles four years old or newer): $40

The minimum for a typical passenger vehicle lands around $199 before conditional add-ons. Newer cars or those with a new lien can push it above $240. The recipient leaves the appointment with either a temporary registration or permanent plates, and the physical title arrives by mail several weeks later.⁶

Federal Gift Tax If the Car Is Worth More Than $19,000

Connecticut’s sales tax exemption is separate from the federal gift tax, and the second one is easy to miss. For 2026, the IRS allows each person to give up to $19,000 per recipient per year without any federal gift tax reporting.¹³ If the car’s value exceeds that, the donor files IRS Form 709 with their tax return for the year.¹⁴

Filing doesn’t necessarily mean owing tax. The amount above $19,000 counts against the donor’s lifetime gift and estate tax exemption, which is large enough that most people never actually pay gift tax. Skipping a required filing is still a compliance problem. A married couple can split the gift, doubling the annual exclusion to $38,000 for a single recipient, which covers most vehicles without any Form 709 at all.¹⁵

1
CT.gov. Learn About Sales Tax on First Time Vehicle Registrations
2
Justia. Connecticut General Statutes 12-412 – Exemptions
3
CT.gov. Transfer Car Ownership
4
CT.gov. Gift Affidavit – Form AU-463
5
CT.gov. Connecticut Registration and Title Application H-13B
6
CT.gov. DMV Fees
7
CT.gov. DMV Forms
8
eCFR. Part 580 Odometer Disclosure Requirements
9
CT.gov. Insurance
10
CT Emissions. Frequently Asked Questions – Connecticut Emissions Program
11
CT.gov. CT DMV Announces New Web Portal for State Emissions Program
12
CT.gov. Make or Change DMV Appointment
13
Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026
14
Internal Revenue Service. Instructions for Form 709
15
Internal Revenue Service. Estate and Gift Tax Updates