Can I register a car in DC and avoid the excise tax?

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Topic: Can I register a car in DC and avoid the excise tax?

Travel and Transportation January 24, 2012 at 5:27 pm

Can I register a car in DC and avoid the excise tax?

My parents just got a new car and are giving me the replaced car.  I don’t seem to qualify for the gift status tax emption because the car is registered in Maryland.  I am wondering if there is a way to transfer the title to me and register the car without having to pay the excise tax, or if POP people have any other advice as to how I can minimize the cost for this process.  Any knowledge is appreciated.  Thanks! 

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You shouldn’t have to pay tax when you transfer registration since your parents already paid the sales tax when they bought the car.  Doesn’t matter how you paid for it–just present the title signed over to you.

I dealt with something similar to this. When I moved here, my car title was originally in my Dad’s name in New Jersey. I was registering it in DC and transferring the car title over to my name. That’s when the excise tax kicked in (to the tune of $1,400). My dad thought we could transfer the title over to my name in the family ($1 sale price for family title transfer), but that doesn’t apply to interstate (NJ to DC; or MD to DC) title transfers. We ate the excise tax cost because doing it the other way was too much of a hassle. But here’s how you can do it if you have more patience than I did:

Have your parents transfer the MD car title to you. You’ll need to re-register the vehicle in MD with your name (and therefore also insure your new car). THEN you can take your MD car title in your name and easily transfer it to DC without paying excise tax. At least that is what the DMV told me 5 years ago. Good luck!

What Kalorini says is correct. I did this a year ago and it worked fine. Have your dad/mom go to MD DMV with you, register the car in your name in MD, and then bring it to the DC DMV to have it registered in your name.
All of this works assuming your parents own the car outright. If there is a lien, you are stuck paying the excise tax.

Thanks for the advice, everybody!  I am going to try the Maryland route.  


My parents bought a car in my name in NY and brought it down to DC for me.  When I went to register the car, I was asked how much we paid.  I told the DMV employee that I wasn’t sure, since it was a gift.  She did ask me a few times – but stopped once I told her that I would have to call my parents and ask.  That is how I got out of the tax.  When I was registering the car I didn’t even know there was a tax and was a little annoyed that I was being asked about the price of a gifted car.

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