How to Gift a Car in Maryland to a Non-Family Member

To gift a car in Maryland to a non-family member, you complete a normal title transfer at the MVA, but the recipient pays the full 6.75% vehicle excise tax on the car’s fair market value. Maryland’s gift exemption from that tax only applies to specific relatives, and friends, partners, coworkers, and cousins are not on the list. Between excise tax, the $200 title fee, and registration, the recipient should expect to spend several hundred dollars at the counter.

Why the Recipient Owes Excise Tax

Maryland exempts vehicle gifts from excise tax only when the transfer runs between qualifying family members and no money changes hands. The exempt list is narrow: spouse, parent, child, grandchild, grandparent, sibling, and in-laws (father-in-law, mother-in-law, son-in-law, daughter-in-law). Nieces and nephews qualify only when the giver is at least 65.¹

Anyone outside those categories is a taxable transfer to the MVA, whether or not money actually changes hands. Calling it a gift on the paperwork does not change the tax treatment.

How Much the Excise Tax Will Be

Maryland charges 6.75% of the vehicle’s fair market value whenever a title is issued.² Because a gift has no sale price to work from, the MVA uses a national used-car valuation guide adopted by the department. For most private-party transfers, if the stated price sits $500 or more below the guide, the MVA defaults to the guide’s retail value.³ With a gift, the guide value controls.

For vehicles seven or more model years old, the statute sets a floor of $640 in fair market value. The minimum excise tax in any case is $100.³

Some quick examples:

Car valued at $12,000: 6.75% works out to $810.
Car valued at $5,000: $337.50.
Older car valued at $900: 6.75% is $60.75, but the $100 minimum applies.

Preparing the Title

The giver starts with the vehicle’s Certificate of Title. On the back, complete two sections: “Assignment of Ownership” and “Application for Title and Registration.” Fill in the recipient’s full name, address, the odometer reading, and the date. The giver signs as “seller” and the recipient signs as “buyer,” which is simply how the MVA form is structured for every ownership transfer.⁴

If the title shows a lien, the giver has to pay off the loan first and get a lien release from the lender. The release can take the form of a signed letter identifying the vehicle and confirming the lien is cleared, or a completed Maryland Security Interest Filing form.⁵ The MVA will not process the transfer without it.

Most used vehicles also need a Maryland safety inspection before the title can transfer, and state law puts that obligation on the seller or transferor.⁶ Take the car to a licensed Maryland inspection station. The certificate is only valid for a limited window, so line up the MVA visit soon after.

Federal and state law require an odometer disclosure on any title transfer. The back of the title has a space for it, and the MVA’s separate Odometer Disclosure Statement (VR-197) may also be required. Filling it in ahead saves time.

At the MVA

The recipient goes to a full-service MVA branch with everything in hand:

The signed Certificate of Title with the assignment and application sections completed
The Maryland Safety Inspection Certificate
The lien release, if there was a lien
Proof of Maryland liability insurance on the Maryland Vehicle Insurance Certification form (FR-19)⁷
Payment for the taxes and fees

Insurance catches some recipients off guard. Maryland will not register a vehicle without liability coverage already in place, so the policy has to exist before the MVA visit, not after plates are issued.

Fees at the counter:

Excise tax: 6.75% of fair market value, with a $100 minimum
Title fee: $200
Registration: $120.50 for cars up to 3,500 lbs, $125.50 for 3,501 to 3,700 lbs, or $191.50 above 3,700 lbs⁸

The MVA then issues a new Certificate of Title in the recipient’s name, a registration card, and plates.

What the Giver Does After the Handoff

Take the plates off before the recipient drives away. The recipient cannot legally use the giver’s tags, and leaving them on the car creates liability exposure in the gap between handoff and registration.

Maryland requires plates that are no longer in use to be returned to the MVA. You can walk them into any of the 24 branch offices during business hours, drop them in a 24/7 tag return drop box at any branch, or mail them by certified mail to MDOT MVA at 6601 Ritchie Highway N.E., Glen Burnie, MD 21062. Include the registration card. If more than 12 months remained on the registration, you may get a 50% refund of the registration fee.⁹

Do not cancel your auto insurance until the MVA has processed the returned plates. Dropping coverage while the plates are still active in your name can trigger fines even after the car is gone.⁹

Federal Gift Tax If the Car Is Valuable

The federal side runs separately from Maryland’s excise tax. For 2026, you can give up to $19,000 per recipient with no federal reporting. If the car’s fair market value goes above that, the giver files IRS Form 709 with their tax return for the year of the gift.¹⁰

Filing does not mean owing. The overage reduces your federal lifetime gift and estate tax exemption, which sits at roughly $15 million per individual for 2026. Actual tax is unlikely unless you have already given away millions, but skipping the form when it is required is a reporting violation. Keep the vehicle’s valuation paperwork with your tax records.

1
New York Codes, Rules and Regulations. Maryland Code Transportation 13-810 – Exemptions From Excise Tax
2
Maryland General Assembly. Fiscal and Policy Note for House Bill 167 – Vehicle Excise Tax Rate Increase
3
Maryland General Assembly. Maryland Code Transportation 13-809 – Imposition of Excise Tax
4
Maryland Department of Transportation Motor Vehicle Administration. Titling – Gift to Family Member
5
Maryland Department of Transportation Motor Vehicle Administration. Lien Placement
6
Maryland State Police. Vehicle Safety Inspection
7
Maryland Department of Transportation Motor Vehicle Administration. Insurance Requirements for Maryland Vehicles
8
Maryland Department of Transportation Motor Vehicle Administration. MVA Fee Listing
9
Maryland Department of Transportation Motor Vehicle Administration. How to Return License Plates (Tags) to MDOT MVA
10
Internal Revenue Service. About Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return