Motor Vehicle Tax Guidebook 2011 - Texas Comptroller of Public ...

SPV Examples
The following examples address two different tax bases
for a used motor vehicle in a private-party purchase.
Example 1: Ricky bought a used motor vehicle from
Ethel for $2,000, which he showed as the sales price
on Form 130-U. The county tax clerk determined that
the vehicle’s SPV was $5,000; 80 percent of $5,000 is
$4,000.
Answer: Tax is based on the 80 percent of the vehicle’s
SPV, or $4,000. The purchaser paid less than 80
percent of the vehicle’s SPV and did not provide a
certified appraisal.
Example 2: Sally saw a classified ad in her newspaper
and bought a car from Dan for $10,000. She checked
the TxDMV website, which showed the SPV as
$25,000; 80 percent of SPV is $20,000. Since the car
had some major body damage, Sally paid a local used
car dealer $300 for a certified appraisal which showed
the car’s value was $12,000. Sally registered and titled
the vehicle, showing the sales price of $10,000 on
the Form 130-U and providing the dealer’s $12,000
certified appraisal.
Answer: Tax is based on the $12,000 certified
appraised value. Sally paid less than 80 percent of the
vehicle’s SPV, but provided a certified appraisal with a
lower value. Even after paying $300 for the appraisal,
Sally saved money by getting an appraisal to lower her
motor vehicle tax due.
Purchase Price Not Available
The Tax Code requires the purchaser and seller to
complete a joint statement indicating the sales price.
Form 130-U, Application For Texas Certificate of Title/
Tax Statement, is the acceptable evidence of sales price,
eligible deductions and exemptions. If a motor vehicle
is purchased out of state, a seller’s signed bill of sale
may be accepted in lieu of the seller’s signature on the
130-U. The Tax Code provides that the county TAC
may require additional documentation to substantiate
the information provided.
Sometimes, however, a sale and change of possession
take place, but the purchaser has not obtained a valid
130-U with the seller’s signature. If the seller’s signature
is not on the Form 130-U, the purchaser must make a
diligent effort to obtain it. Acceptable evidence of that
diligent effort can take the form of a receipt obtained
by sending a certified letter, return receipt requested,
to the seller’s last known address. Other credible
documentation may be accepted by the county TAC.
If, after making the necessary diligent effort, the
purchaser has been unable to locate the seller to obtain
the necessary signature on the Form 130-U, the taxable
value must still be established for the sale and may be
determined in the following ways:
Seller Is Known to be a Dealer
• Use a seller-signed bill of sale.
• If a signed bill of sale is not available, use the
SPV value.
• If the SPV value is not available, then require an
appraisal from a dealer, insurance adjuster or at
the discretion of the county TAC, someone who
would have special knowledge of the vehicle’s
value. Such a person may include an antique
dealer or antique auction. The Comptroller’s
appraisal form may be used, but is not required.
In lieu of the appraisal, a title applicant who is
obtaining a title through the bonded title process
may use two-thirds of the bond amount (bond is
for 150 percent of vehicle value).
Private-Party Sale or Seller’s Identity
is Not Documented
For a Motor Vehicle Fewer than 25 Years Old
• Use the SPV procedure, which includes
comparing the price to other documentation
(e.g., bill of sale, canceled check), if available.
• If the SPV is not available, require an appraisal
on Form 14-128.
For a Motor Vehicle 25 Years Old or Older
• Use a seller-signed bill of sale.
• If a signed bill of sale is not available, then
require an appraisal from a dealer, insurance
adjuster or at the discretion of the county TAC,
someone who would have special knowledge of
the vehicle’s value. The Comptroller’s appraisal
form may be used, but is not required. In lieu
of the appraisal, a title applicant who is obtaining
a title through a bonded title process may use
two-thirds of the bond amount (bond is for
150 percent of vehicle value).
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Motor Vehicle Tax Guidebook