Gifting a car or selling it for cheap???

quote:

---

or sell/buy it for a minimum amount of money?

---

Also called gifting.

What is the estimated value of the vehicle? Should be able to drop the info into kbb and get a reasonable number.

Also, what is the "minimum amount" the family member is willing to sell for?

quote:

---

So what is the difference, tax wise, on a gifted vehicle vs. one that has a bill of sale for anything less than the value of the vehicle?

---

i mean if we're dealing with a 10k private party value vehicle... if you tell the auto title transfer place you sold it for 8k, it won't raise any hairs. you pay taxes on 8k. if you tell the dmv you sold it for $1000, it begins to look pretty sus. You're essentially still gifting 9k in that scenario.

auto title people don't need to see proof of money purchase.

KBB values it at $18k

Thanks for the info.

I know I got down voted, but if the irs doesn't have a record of the sale, did it really happen? No one is sending the sale info to the irs.

The IRS has zero clue about how much you paid, or anything. It's all self reported by you, the gullible taxpayer. W2 I come is reported to both fed and state. Same with 1099s. Same with real-estate sales.

Personal sales are not. Stop paying taxes on crap they can't track.

You're welcome

Not me… but someone I know… has sold many cars for $3000 or less on paper. “They” asked the lady at the title transfer place if anything ever happens or red flags are raised and she said never. We see it all day everyday and I’ve never heard of anything happening.

On top of that, acts of donation happen all of the time too so no taxes are paid.

In LA, an immediate family member (father/daughter, brother/sister, etc.) can donate to another, and there will be no sales tax to register the car to the new owner/donee. (Some online sources say that there is a $15K cap on this, but I'm not sure if that is correct.) Be sure to complete the part of the form that asks for the relationship between donor and donee. Act of Donation of Movable form

If the donor is not an immediate family member, then OMV will require the new owner/donee to pay sales tax on what they determine to be fair market value. In that case, you may be better off structuring the transfer as a sale (rather than a donation) at the minimum price that you think OMV will accept. Folks often low ball it a bit, but if you present a bill of sale for what is obviously a $40,000 car and claim it sold for $5,000, they may call bullshite and tax on FMV.

I just gifted a vehicle to my daughter in Texas. There was no sales tax. Just a $10 fee. Still had to pay for registration and license, though.

(no message)