Hi Mamas,
I am hoping someone can give me information regarding transferring cars between siblings. My sister moved to Singapore for at least 2 years because her husband found a job there. They have a minivan that she is willing to let me use while she is away. However, she does not want to have any "liabilities" and wants the title transferred to me and when she gets back, I would transfer it back to her. So I researched on CA's DMV site but only found that cars can either be sold or gifted between family. I guess she can "gift" me the car, but does that mean we don't have to pay use/sales tax? And why does it ask for the market value on the form? So if we list the market value to be 24K then does it mean she doesn't have to pay gift tax (12K for my husband and I each?) I have also heard of people selling cars to family for $1, but don't know of anyone actually doing it. So in this case, do we pay the 9.25% on $1 only? Even if the market value is mid 20K? Anyone with any experience or knowledge, please help! Thanks in advance!
The last couple of times we've done a family transfer there has only been a $10 filing fee to change the owner of record... no taxes.
We have done this a few times. Your sister will want to gift it and you do not pay any taxes. I do not know why there has to be a market value on it, but we just guessed and they didn't say anything. You only have to pay a transfer fee.
I don't see why you can't gift it back to her when she returns.
The other thing you can consider is just putting your name on the title with hers. Then, you are both on there and you don't have to transfer anything.
When I got married the car that my dad gave me in college he no longer wanted liabilities on. So he gifted the car to me. It was really easy we went into to DMV together filled out a form and transferred title and that was it. We had to pay nothing.
I'm not too sure about the taxes, but do know that you don't need a smog certificate. The car that I transferred three years ago from my son-in-law, I paid no use taxes nor did he pay anything on a car valued by Kelly Blue Book at 6 K. But I had already taken it for the smog testing, and it wasn't necessary.
Hi K., I did this last week, for a car we sold to a extended family member, that has joined the military and is going over seas. We took back the car. I had to have the car smogged because it was done 6 months ago and had to be done within 3 months. I had to show proof of insurance, which only makes sence, and have the signature to prove that it was gifted to you. You, need to make sure that in everyway she is no longer responsible for any tickets, accidents that you may have while it is in your use.
When she comes back, the laws will have changed . I know that DMV, may no longer have the gift item w/o the taxes. So you will have to work it out. Good Luck, NanaG
K.
You will have to pay the tax on whatever the market value is. I have been told if the car is gifted to you then you will have to pay nothing. That is what my aunt and uncle did for their daughter. I wouldn't fill in the market value of the car unless asked, and be sure to get her signatures before she leaves.
W. M
I know I'm a little late here, but if I were in that situation, I would keep your sister as the "legal" owner on the title and have you as the registered owner. That way she doesn't have to actually transfer the ownership of the car to you, but you (not her) are liable if anything were to happen. It is sort of the same as if the car was being financed (the bank is the legal owner, with you the registered owner), but in this case she would be the bank. :)
I'm sure you have trust in your sister and she trusts you, but I wouldn't want to transfer ownership unneccessarily. Good luck.
Hi K.,
My mom just recently transferred her car to us (she doesn't drive anymore) and as long as it is gifted between family members, you don't have to pay tax. If you have questions on the form, go to your local DMV and they can help you fill it out.
K.
If your sis is gonna take the car back when she returns from the Philippines why don't you just become the registered owner and carry the insurance on it? That seems simpler, you will need to smog it if you transfer the title.
K.,
The DMV does allow transfers between family members without any sales or use tax. There used to be a special form just for this - be sure to ask for that form. It isn't considered a gift so the Federal gift tax thing/amounts don't apply.
Take care - J.
