What Is the Texas Motor Vehicle Use Tax and Local Tax Rate?

The Texas motor vehicle use tax is a 6.25% tax on the purchase price of a vehicle bought outside Texas and brought into the state for use on public roads. It’s collected under Tax Code Chapter 152 and is due within 30 calendar days of the vehicle’s first use in Texas. If you already owned the vehicle before moving here, you pay a flat $90 instead. Either way, you settle up at your county tax assessor-collector’s office when you apply for a Texas title.¹

When the 6.25% Rate Applies

If you live in Texas and buy a car, truck, SUV, or motorcycle from a dealer or private seller in another state, you owe 6.25% of the total consideration you paid. That figure includes the cash price plus the value of any trade-in.¹ The rate matches what Texas charges on in-state retail vehicle sales, so an out-of-state purchase doesn’t come with a tax discount.

The tax covers motorized vehicles designed for public highway use. You pay it when you present your title paperwork at the county office.

The $90 New Resident Alternative

Moving to Texas with a vehicle you already own is a different situation. Instead of 6.25%, you pay a flat $90 new resident tax, provided the vehicle was previously titled in your name in another state.² The $90 is due within 30 calendar days of first use in Texas, along with standard title transfer paperwork, your surrendered out-of-state title, and the usual title and registration fees.

On any reasonably priced vehicle, $90 beats the percentage calculation. The distinction turns on whether the vehicle was already yours when you crossed into Texas, not on when you registered it here.

Credit for Tax You Already Paid Elsewhere

If you bought the vehicle out of state and paid that state’s sales or use tax, Texas gives you a dollar-for-dollar credit against the 6.25% owed here.¹ A $30,000 vehicle purchased in a 4% state would carry $1,200 in tax paid there; Texas would want $1,875, leaving a balance of $675.

The credit only reflects tax actually paid. Buy in a no-sales-tax state or use an exemption there, and you owe Texas the full 6.25%. Bring documentation of the other state’s tax when you visit the county office, because you’ll need to prove the amount to claim it.

How the Taxable Amount Is Set on Private-Party Sales

When you buy from a private seller rather than a licensed dealer, Texas uses a Standard Presumptive Value system to sanity-check the price. The SPV is a fair market value based on make, model, year, and regional sales data.³ Your tax is calculated on the greater of the actual sales price or 80% of the SPV.

So if you and a seller agree on $12,000 and the SPV is $20,000, writing $8,000 on the paperwork won’t save you anything. The tax office will calculate on $16,000 regardless. If you genuinely paid below market, you can get a certified appraisal from a licensed motor vehicle dealer or licensed insurance adjuster and present it to the county tax assessor-collector within 30 calendar days of the sale (or within 30 days of bringing an out-of-state vehicle into Texas). Active-duty military personnel get 60 calendar days.³

Gifts Between Family Members

Vehicles given as genuine gifts between eligible family members carry a flat $10 gift tax rather than the 6.25% use tax.⁴ Eligible relationships typically include spouses, parents and children, and siblings. Both parties must sign the title application affirming no money or other consideration changed hands.

A parent passing a car to a college-age child pays $10. The transfer has to be a real gift, though. A “$1 sale” to a relative will likely get flagged, and the SPV system can override the stated price anyway.

The 1.75% Single Local Use Tax Rate Does Not Apply

People sometimes assume the 1.75% Single Local Use Tax Rate under Tax Code Section 151.0596 applies to vehicles. It doesn’t.⁵ That rate sits under Chapter 151 (general sales and use taxes on consumer goods), while vehicles sit under Chapter 152.

The 1.75% rate is an elective option for remote sellers shipping goods into Texas from out of state. Instead of tracking every local jurisdiction’s rate, a qualifying remote retailer can collect a flat 1.75% to cover all local tax obligations. Businesses located within Texas aren’t eligible, and it has no bearing on what you owe when registering a vehicle.

Paperwork and Where to File

The central form is the Application for Texas Title and/or Registration, Form 130-U. Every buyer listed on the title must sign it, and the form asks for the vehicle identification number from the driver-side door frame or the dashboard near the windshield.⁶

Bring with you:

The original out-of-state title, which you’ll surrender.
Proof of Texas liability insurance meeting the state minimums of $30,000 per person and $60,000 per accident for bodily injury, plus $25,000 for property damage.⁷
A bill of sale or invoice showing the purchase price.
Lienholder name and address if the vehicle is financed.
Documentation of any sales tax paid in another state, if you’re claiming the credit.

You’re not restricted to the county you live in. Texas lets you file in the county where the sale happened, where the lienholder is located, where you reside, or any county willing to accept the application.⁶ Most offices accept cash, checks, and money orders; many take credit cards with a convenience fee added.

You’ll walk out with a receipt that acts as temporary proof of registration. Allow at least 20 business days for the title itself. If a lienholder exists, the title goes to the lender. If 30 business days pass without a title, contact TxDMV.⁸

What Happens If You Miss the 30-Day Deadline

The initial late penalty is $25, with another $25 added for every month the title remains untransferred.⁹ There are no waivers. A vehicle left untitled for six months would run up $150 in penalties on top of the tax owed. Driving an unregistered vehicle on Texas roads can also draw traffic citations.

Active-Duty Military Stationed in Texas

If you’re on active duty, stationed in Texas, and legally domiciled in another state, the federal Servicemembers Civil Relief Act prevents Texas from taxing personal property, including vehicles, that you have in the state solely because of military orders.¹⁰ You can keep your home-state registration and plates without owing the Texas use tax.

The protection generally requires valid registration and insurance in your state of legal residence. If you or your spouse establish Texas residency, or voluntarily register the vehicle in Texas, SCRA protection may no longer apply. The line between “stationed here” and “living here” is worth confirming with the county tax office before you register anything.

1
Texas Comptroller of Public Accounts. Motor Vehicle – Sales and Use Tax
2
Texas Comptroller of Public Accounts. New Resident Tax – Motor Vehicle Tax Guide
3
Texas Comptroller of Public Accounts. Standard Presumptive Value (SPV) on Private-Party Transactions
4
Texas Comptroller of Public Accounts. Gift Tax – Motor Vehicle Tax Guide
5
Texas Comptroller of Public Accounts. Single Local Use Tax Rate Taxpayer Search
6
Texas Department of Motor Vehicles. Detailed Instructions for Application for Texas Title and/or Registration
7
Texas Department of Insurance. Auto Insurance Guide
8
Texas Department of Motor Vehicles. Buying or Selling a Vehicle
9
Texas Department of Motor Vehicles. Title Penalties Press Release
10
Office of the Law Revision Counsel. 50 USC 4001 – Residence for Tax Purposes