Buying a car in Texas

Sales tax on a car in Texas

Texas charges a state motor vehicle sales tax of 6.25% on vehicle purchases.

There is no local motor vehicle tax in Texas.

For a private-party purchase of a used vehicle, tax is based on the price paid or 80% of the vehicle's standard presumptive value, whichever is greater, unless the buyer provides a certified appraisal within 30 days.

Does a trade-in lower the tax?

Tax is charged on the sales price minus any trade-in allowance.

Example, state tax only. On a $30,000 car with a $10,000 trade-in, the taxable amount is $20,000, so the state tax is about $1,250. Without the trade-in it would be $1,875. Local taxes and fees are extra.

Dealer doc fees in Texas

Texas does not set a fixed maximum for the documentary fee on financed sales. A dealer may charge up to $225 without filing; to charge more, the dealer must first notify the Office of Consumer Credit Commissioner and provide a cost analysis, which the agency reviews for reasonableness.

The documentation fee is not taxed.

Whatever the rule, the fee is part of your out-the-door price. Ask for it in the written quote and negotiate the total, not the line. See dealer fees explained.

Title and registration

Titles and registrations are handled by the Texas Department of Motor Vehicles. A dealer is required to file the title application for the buyer. In a private sale, the buyer must title the vehicle within 30 days of the sale date at the county tax office.

Also worth knowing

• A separately stated documentary fee is deducted from the taxable total and is not subject to motor vehicle sales tax.
• Metal license plates replaced temporary paper tags on July 1, 2025.
• Non-commercial vehicles in 17 counties must pass an emissions inspection before registration.
• A new resident bringing a vehicle into Texas pays a $90 new resident tax instead of use tax.

Sources

1. Texas Comptroller: Motor Vehicle Sales and Use Tax (comptroller.texas.gov)
2. Texas Comptroller: Private-Party Purchases and Standard Presumptive Values (comptroller.texas.gov)
3. Texas Comptroller: Motor Vehicle Tax Guide, Total Consideration (comptroller.texas.gov)
4. Texas Comptroller: Motorcycles, Autocycles, and Off-Highway Vehicles (rate and local tax statement) (comptroller.texas.gov)
5. Texas Office of Consumer Credit Commissioner: Documentary Fee Filing Instructions (Bulletin B16-5) (occc.texas.gov)
6. Texas Department of Motor Vehicles: Buying or Selling a Vehicle (txdmv.gov)

Last checked Nov 10, 2026; next review by Feb 10, 2027. This page explains how the rules generally work and is not tax or legal advice. Rules change, so confirm with the state. Report an error.