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

no title is required. The sale date indicated on the Texas
Motor Vehicle Transfer Notification, may also be used.
The date a vehicle is brought into Texas is verified
by a document showing delivery date in Texas or a
document dated in Texas. Acceptable documents
include a weight certificate, identification certificate,
customs import document or state inspection
document.
Penalty Schedule Example
September 1
September 2
September 30
October 1
October 30
October 31
Delivery date or date brought
into Texas
1st day of 20 county working days
Due date (20 county working days
from delivery date – excluding
Labor Day)
5 percent penalty due
30th calendar day from due date
Additional 5 percent penalty due
(31st calendar day from due date)
Refunds and the Lemon Law
• Refund Procedures
• Lemon Law
Refund Procedures
Refunds of motor vehicle tax paid in error, except
on seller-financed sales, must be recovered from
the Comptroller. County TACs or dealers may give
taxpayers a copy of Form 14-202, Texas Claim for
Refund of Motor Vehicle Tax, Diesel Motor Vehicle
Surcharge, and/or Commercial Motor Vehicle
Registration Surcharge. Page 2 of the form provides
instructions for filing the refund claim. The taxpayer
will need a tax receipt and often the purchase invoice to
submit with the refund claim.
Tax paid erroneously on seller-financed sales must be
recovered from the dealer who collected the tax.
Lemon Law
Sometimes manufacturers and distributors will
purchase a defective motor vehicle from the initial retail
purchaser, generally through independent negotiation.
Occasionally, the repurchase is through the Texas
“lemon law.”
When the “lemon law” passed in the early 1980s, the
Comptroller determined that the initial retail sale
was refundable to the extent of the monies returned
by the manufacturer or distributor. The “lemon law”
provides that tax paid by the initial purchaser is part
of the purchase price that is required to be refunded
by the manufacturer/distributor. The law also provides
for a deduction of a reasonable allowance for use,
determined by a time/use formula.
Similar procedures apply to situations, such as
arbitration through the Better Business Bureau, where
the refund computation is done in a manner similar to
the “lemon law.”
The Comptroller’s policies concerning a tax refund are:
1. If the defective motor vehicle is returned to
a dealer who is selling a replacement motor
vehicle, the dealer may indicate the returned
vehicle as a trade-in and thus, no refund
application is necessary. Otherwise, tax
should be recovered from the Comptroller.
2. When a refund is due, a written request
should be filed with the Comptroller by using
Form 14-202.
Rental Motor Vehicles
• Rental Permit
• Trade-In or Retired Motor Vehicle
• Tax-Exempt Registration Requirements
Rental Permit
All persons offering motor vehicles for rent must
register with the Comptroller. A motor vehicle rental
occurs when there is a contract period of 180 days or
fewer. The person will collect and report motor vehicle
rental tax directly to the Comptroller.
See Publication 96-143, Motor Vehicle Rental Tax
Guidebook.
Trade-In or Retired Motor Vehicle
A permit holder may either trade a motor vehicle to a
seller and reduce the total consideration by the value
of the retired motor vehicle or deduct the fair market
value of a motor vehicle being retired and offered for
sale from the purchase price of a new motor vehicle.
III-22
Motor Vehicle Tax Guidebook