In Texas, your daughter will have to pay a gift tax of $10 if you give her a car. That's the Texas state tax for motor vehicles given as gifts by immediate family members, and it's due even if you yourself don't live in Texas. The tax is the same for any motor vehicle, whether it's a 1990 pickup or a 2016 Porsche.
You're more likely to run into trouble with the federal gift tax. You can give an individual up to $14,000 a year's worth of gifts in a given year tax-free. If the fair market value exceeds that amount, it's you who pays the tax, if applicable. Besides looking up the vehicle's valuation on Edmunds.com or the Kelley Blue Book website, you may also consider checking the Texas Vehicle Presumptive Value calculator. Print the valuations for your tax records.
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The specific form that designates the car as a gift is the Affidavit of Motor Vehicle Gift Transfer, Form 14-317. You'll both have to sign it in front of a notary public or an employee at the county tax office and file it along with the gift tax payment.
You'll also have to transfer the title to the vehicle. Your daughter has 30 days to file the paperwork after you give her the car. Along with Form 14-317 and the $10 gift tax, she'll need:
- Automobile title
- Application for Texas Certificate of Title (Form 130-U).
- Proof of insurance
The forms are available from the Texas Department of Motor Vehicles here.
Your daughter won't need a new inspection or registration if both are up to date. If they're due for renewal, the registration fee is $50.75 for cars and light trucks as of this writing. Inspection fees run $10.25 to $31, depending on the county and the age of the car.
The title application fee should be $28 to $33, depending on the county of registration. There also are small fees that may total from $2 to $22 -- for the registration transfer, an insurance verification check, and so forth, depending on the county.