Texas [TX] Car Sales Tax (State + Local) Calculator | Fees to Consider
If you’re looking to purchase a vehicle in Texas, then you should know current state sales tax on vehicle sales.
The state sales tax for cars in Texas is 6.25%, but each city or county may have additional vehicle tax.
With our years of experience, we will walk you through the current sales tax rules and other fees associated with vehicle sales in Texas.
Texas Car Sales Tax Key Takeaways
- Statewide Texas car sales tax is 6.25% of the purchase price.
- Local counties or cities in Texas may also charge car sales tax of up to 2%.
- New residents bringing a vehicle to Texas from another state must also pay a $90 new resident tax.
How to Calculate Texas Car Sales Tax Video
How Much Is the Car Sales Tax in Texas?
There is a 6.25% sales tax on the sale of vehicles in Texas.
However, there may be an extra local or county sales tax added onto the base 6.25% state tax.
Local tax rates range from 0% to 2%, with an average of 1.647%. The max combined sales tax you can expect to pay in Texas is 8.25%.
How Much is Sales Tax Calculated for a Used Car Purchase in TX?
Title and license fees for a used car in Texas typically range from $90 to $95. The specific amount may vary depending on the county in which the vehicle is registered.
In addition to the title and license fees, the sales tax rate in Texas is 6.25%.
Sales Tax for a Private Sale
If the used car is purchased through a private sale, the taxation may be based on either the purchase price or the Standard Presumptive Value (SPV) of the vehicle, whichever is higher.
The SPV is determined by considering similar sales in the region. It’s important to note that these figures are provided as a general guide. Consult with the Texas Department of Motor Vehicles or a tax professional for the most accurate and up-to-date information based on your specific circumstances.
How to Calculate Texas Sales Tax on a Car
To calculate the sales tax on your vehicle, find the total sales tax fee for the city. The minimum is 6.25% in Texas. Multiply the vehicle price (after trade-in and/or incentives) by the sales tax fee.
For example, imagine you are purchasing a vehicle for $35,000 with a state sales tax of 6.25%. You trade in a vehicle for $3,000 and get an incentive for $1,000. Texas does not charge tax on trade-ins and rebates, so you would subtract $4,000 from the car cost, to get $31,000, which is the taxable amount.
In this example, multiply $31,000 by .0625 to get $1,937.50, which makes the total purchase price, $32,937.50.
Calculate Car Sales Tax in Texas Example
- Initial Car Price: $35,000
- Sales Tax Rate: 6.25%
- Trade-In Amount: $3,000
- Rebate/Incentive Amount: $1,000
Sales Tax = ($35,000 – $3,000 – $1,000) * .0625
Sales Tax = $1,937.50
Texas Sales Tax Calculator
How Do You Calculate Tax, Title, and License on a Vehicle in Texas?
The out-the-door price (tax, title, and license) you can expect to pay when buying a car in Texas is calculated by adding:
- Final Sale Price of Vehicle
- Sales Tax: 6.25% of the total vehicle purchase price minus any rebates/incentives and/or trade-ins.
- Title Transfer Fee: $33
- License / Registration Fee: $50.75 base fee
- Documentation Fee: Average is $135
Which County Has the Highest Tax? Which Has the Lowest?
The vast majority of Texas counties have the highest sales tax in the state at 8.25%. However, Borden, King, Kennedy, Kent, Loving, and McMullen have the lowest tax rate of 6.25%.
How Are Trade-Ins Taxed in Texas?
You do not have to pay a sale tax on the trade-in value of your vehicle in the state of Texas.
In other words, when calculating sales tax, be sure to subtract the trade-in amount from the car price.
Let’s say that you’re purchasing a new car for $30,000 and your trade-in is valued at $10,000. This would put your new vehicle purchase price at $20,000, which is the taxable amount.rice at $40,000, which is the taxable amount.
How are Rebates and Dealer Incentives Taxed?
Texas does not tax rebates and dealer incentives.
In other words, be sure to subtract the incentive amount from the car price before calculating the sales tax amount.
As an example, let’s say you want to purchase a new truck for $50,000 and the dealer provides a $3,000 rebate. You do not have to pay a sales tax on the $3,000 rebate. Therefore, the taxable amount is $47,000.
Texas DMV & State Fees
Here are the state DMV fees in Texas when it comes to registering and titling a vehicle.
Registration Fees:
- Standard Fee – $50.75 per year
- Vehicles 6,001 to 10,000 pounds – $54.00 per year
- Vehicles Over 10,000 pounds – Based on the weight of the vehicle.
Title Fee:
- Standard Fee – $33
Texas Dealership Fees
The average dealership fee is $135, with no statewide limit. This is known as the documentation or “doc fee”.
This fee covers the cost of finalizing the vehicle sale with the state. Usually, this fee can not be negotiated. However, other dealership fees such as the advertising fee and the transport fee can be negotiated.
Vehicle Sales Tax Exemptions in Texas
You can be exempt from paying sales tax on a vehicle sale in the following situations:
- You plan to move out of the state in 90 days.
- The vehicle is 25 years or older
- You are disabled
- Motor vehicles given as a gift
- Salvaged or abandoned vehicles
- Off-road motor vehicles (dirt bikes, ATVs)
- Motor vehicles purchased at a government auction or foreclosure
- Vehicles were swapped in an even trade
Texas EV Rebates & Incentives
Texas does not offer any incentives for EVs right now. This is on top of the up to $7,500 Federal rebate on electric vehicles.
Texas Vehicle Sales Tax: Final Verdict
The state of Texas charges 6.25% of the vehicle’s purchase price for sales tax. However, counties may charge up to 2%, and many do. Therefore, 8.25% is commonly how much car buyers pay for sales tax in Texas.
Be sure to use the sales tax calculator to estimate your costs.
Looking for car sales tax information for another state? Read our complete guide on car sales tax in each state.
Tax information and rates are subject to change, please be sure to verify with your local DMV.
