The Massachusetts car sales tax is 6.25%, applied to either the price you paid a dealer or, for a private sale, the higher of what you paid and the vehicle’s NADA clean trade-in value adjusted for mileage. Multiply the taxable value by 0.0625 to estimate what you owe: a $25,000 car works out to $1,562.50. The rate is the same whether you buy from a dealership or a private seller; what changes is how the state decides the number it taxes.1Massachusetts Department of Revenue. Motor Vehicle and Trailer Sales and Use Tax
How the Taxable Value Is Set
Buying from a Dealer
At a licensed dealership, the tax is 6.25% of the purchase price shown on the bill of sale. The dealer collects it at closing and sends it to the state, so you don’t make a separate trip to the RMV to pay.1Massachusetts Department of Revenue. Motor Vehicle and Trailer Sales and Use Tax
Buying from a Private Seller
Private sales work differently. Massachusetts does not simply accept whatever price two individuals write down. The state taxes you on whichever is higher: the actual price you paid, or the NADA clean trade-in value for that make, model, year, and trim, adjusted by the RMV for the vehicle’s mileage. High mileage pulls the book value down; low mileage pushes it up.1Massachusetts Department of Revenue. Motor Vehicle and Trailer Sales and Use Tax
The rule is there to stop buyers and sellers from writing a low number on the bill of sale to shrink the tax. If you pay a friend $8,000 for a car NADA values at $12,000, you owe 6.25% on $12,000, not $8,000. Look up the clean trade-in figure before you agree on a price, or the number the clerk hands you at registration may be larger than you planned for. For older vehicles that current NADA guides don’t list, the RMV may fall back on other valuation methods.
How a Trade-In Cuts the Tax
If you trade in a vehicle at a licensed dealer, the trade-in value comes off the purchase price before the 6.25% is calculated. A $30,000 car with a $10,000 trade-in is taxed on $20,000, saving you $625 in tax.2Massachusetts Department of Revenue. Directive 02-4: Calculation of Trade-in Allowance on Purchase of a Motor Vehicle
This deduction is dealer-only. In a private sale, even if the seller agrees to take your old car as part of the deal, the Department of Revenue will not reduce the taxable amount. You pay 6.25% on the full value with no offset.3Massachusetts Department of Revenue. Letter Ruling 00-2: Trade-in of Motor Vehicle With a valuable trade-in, this alone can make a dealer purchase cheaper after tax than an identical private sale.
Exemptions That Wipe Out the Tax
Several transfers are exempt from the 6.25% tax, but each one needs a specific affidavit filed with the RMV.4Massachusetts Department of Revenue. Motor Vehicle Sales and Use (MVU) Tax Forms
- Transfers between a parent and child, between spouses, or between siblings, using Form MVU-26.5Massachusetts Registry of Motor Vehicles. Family/Gift Transfers
- Genuine gifts to anyone, not just family, using Form MVU-24. The affidavit is signed under penalty of perjury.6Massachusetts Department of Revenue. Form MVU-24 Affidavit in Support of a Claim for Exemption from Sales or Use Tax for a Motor Vehicle Transferred as a Gift
- Vehicles inherited through a will or intestate succession, using Form MVU-27.
- One personal-use vehicle for a person who has lost the use of both legs, both arms, or one of each, using Form MVU-33.
- Vehicles transferred to an insurer after a total loss, using Form MVU-23.
Bring the correct form with you when you register. Claiming an exemption after you’ve already paid means applying for a refund through the Department of Revenue, which is slower.
Credit If You Paid Sales Tax in Another State
Buy a car in another state and pay that state’s sales tax, and Massachusetts gives you a dollar-for-dollar credit against the 6.25% use tax, provided the other state extends the same courtesy to Massachusetts residents. Pay 6.25% or more elsewhere and you usually owe nothing; pay less and you owe the difference.7Massachusetts Department of Revenue. TIR 03-1: Exemption From Massachusetts Use Tax for Tax Paid Under Laws of Another State
A few states have quirks. Virginia’s credit can’t reduce your Massachusetts tax below $35 per vehicle. Maryland’s can’t bring it below $100. South Carolina’s is capped at the lesser of 5% of the tax base or $300. Arkansas offers no reciprocal credit for motor vehicles, so Massachusetts won’t credit any tax paid there.7Massachusetts Department of Revenue. TIR 03-1: Exemption From Massachusetts Use Tax for Tax Paid Under Laws of Another State Bring documentation of the tax paid when you register.
When and How to Pay
You have 10 days from the date you buy, receive, or first use the vehicle in Massachusetts to file and pay.8Massachusetts Department of Revenue. Sales and Use Tax
At a dealer, the tax is collected at closing and remitted for you. For a private sale, you pay at the RMV when you register and title the car. Bring the completed Application for Title and Registration (Form RTA), the seller’s certificate of title (or registration and bill of sale for older title-exempt vehicles), proof of insurance from a licensed Massachusetts agent, and the sales price on the title or a separate bill of sale. Both parties must sign and print their names on the transfer documents, and the seller has to disclose the odometer reading.9Massachusetts Registry of Motor Vehicles. Apply for a Registration and Title for a Vehicle Purchased from an Individual
If the car doesn’t need to be registered in Massachusetts, say because a nonresident is buying here to title elsewhere, the buyer still owes Massachusetts sales tax. File Form ST-7R and pay by the 20th of the month after the purchase.8Massachusetts Department of Revenue. Sales and Use Tax
What Happens If You Pay Late
Miss the 10-day deadline and interest starts accruing at the federal short-term rate plus four percentage points. The Department of Revenue has no authority to waive it.10Massachusetts Department of Revenue. Interest on Your Massachusetts Tax Underpayment or Overpayment The state can also add penalties for late filing. Paying on the day you register is the simplest way to avoid all of it.
Other Costs to Budget For
The 6.25% is not the only line item when you take delivery of a car in Massachusetts.
- Standard passenger vehicle registration is $60 and renews every two years.11Massachusetts Registry of Motor Vehicles. Massachusetts Registry of Motor Vehicles Fees
- The RMV charges a separate title fee.
- Your city or town bills an annual motor vehicle excise of $25 per $1,000 of assessed value, based on the manufacturer’s list price and a statutory depreciation schedule rather than what you actually paid. A new car is assessed at 90% of list price in its model year, then 60%, 40%, 25%, and 10% from the fifth year onward.12Massachusetts Department of Revenue. Motor Vehicle Excise
The excise bill catches many first-time buyers off guard because it arrives from the municipality, not the RMV. On a new car with a $35,000 list price, the first-year excise runs about $788 ($35,000 × 90% × $25/$1,000), then falls each year as the schedule depreciates the value.
Federal EV Credits No Longer Offset the Tax
If you’re buying an electric or plug-in hybrid, the federal clean vehicle credits under Sections 30D and 25E are no longer available for vehicles acquired after September 30, 2025.13Internal Revenue Service. Clean Vehicle Tax Credits Those credits, up to $7,500 on qualifying new EVs and up to $4,000 on used ones, used to soften the sales tax on a pricey vehicle. For 2026 purchases, plan on paying the full 6.25% Massachusetts tax without a federal offset.