Key Takeaways:

  • You can give a car to a family member for free or sell the car to them
  • You must transfer the title to release your legal obligation for the vehicle
  • There are two documents both parties must complete and take to the DMV for the transfer
  • There is a $10 gift tax all recipients must pay when they receive a transferred car

Giving a car to a family member can be a nice gesture, but it’s crucial to make it legal. When learning how to transfer a car title to a family member in Texas, it’s essential to understand the required documents, cost, and tax implications of the transfer. This understanding is key to avoiding any potential legal issues, as Texas has different laws than other states.

What Does Transferring a Car to a Family Member Mean?

Transferring a car to a family member can be a free gift or an exchange for money. Common reasons to transfer a car to a family member include:

  • Inheritance upon the car owner’s death
  • Gift for a family member, such as a child
  • Selling the car to a family member

Fortunately, transferring a title is a straightforward process, but it’s important to do so properly. The owner of the motor vehicle record is liable for anything related to the car. If you transfer the car to a family member, it’s crucial that you first complete a title transfer.

How to Transfer a Car Title as a Gift

If you’re conducting a gift transfer, follow these steps:

The Affidavit of Motor Vehicle Gift Transfer requires notarization, so neither party should sign the document until you are in front of a public notary.

The recipient must bring the required documents to the local DMV within 30 days of the transfer.

How to Transfer a Car Title as a Sale

If you’re selling the vehicle to a family member, follow these steps:

  • Document the odometer reading on the title
  • Complete the ‘Assignment of Title’ section
  • The buyer must complete the Application for Texas Title
  • The seller must provide a bill of sale stating the purchase price

Before selling a car to a family member, be sure the car has no outstanding loans. If you owe money on an auto or title loan, contact your lender to determine how to proceed. Typically, you must pay the loan off before selling the vehicle.

Eligible Family Members for Title Transfers

Eligible family members for title transfers include any of the following:

  • Parents or in-laws
  • Children or step-children
  • Spouse (must be separate property)
  • Siblings or sibling-in-laws
  • Grandparent or grandchild (including in-laws)
  • Guardian (with proof of guardianship)

Required Documents to Transfer Car as a Gift or Sale

Before heading to the local DMV to conduct a title transfer, be sure you have the following required documents:

  • Title: You must have the original title signed over to the recipient
  • ID: Government-issued ID is necessary, such as a driver’s license
  • Insurance: Proof of adequate liability insurance for the vehicle
  • Lien release: If you have a loan on the car, you must have an official lien release

What’s the Cost to Transfer Title to a Family Member?

The cost to transfer a title to a family member in Texas is quite affordable. First, you must pay the gift tax of $10. This is the recipient’s responsibility and is paid to the county tax assessor when you transfer the title.

There is also a $33 application fee plus any registration fees the recipient owes. The registration fees in Texas are $78.25 for passenger vehicles.


How Do I Title an Inherited Car in Texas?

You can title the inherited car in your name. To do this, you must bring the deceased owner’s death certificate and the original title with you named as the beneficiary.

Do Both Parties Have to be Present to Transfer a Car in Texas?

If the seller or person gifting the car properly signed the title, they do not have to be present at the DMV to transfer the title. However, the person receiving the vehicle must present the Application for Texas Title in person at the DMV.

Do I Need to Notify the DMV if I Sold My Car in Texas?

To ensure you are no longer legally liable for the vehicle, you should complete the Vehicle Transfer Notification and bring it to the DMV. You may also mail it to the address on the form or complete it online.

Final Thoughts

Transferring the vehicle’s title to a family member is relatively inexpensive and only takes a few minutes. If you properly sign the title and necessary paperwork, you don’t have to go to the DMV with the recipient when they request a new title.

It’s important to have the title in the appropriate owner’s name for liability purposes and in case the owner wants to use the car as collateral for a title loan. If you would like to learn more about how a title loan works or want to apply for one, contact us at 888-700-8900 or apply online.

Written by Samantha Hawrylack

Written by

Samantha Hawrylack

Samantha Hawrylack writes for our company and is an expert in personal finance. Sam received her Bachelors of Science in Finance and her Masters in Business Administration from West Chester University of Pennsylvania. She began her career in the financial services industry and shifted to an entrepreneurial role where she could directly impact clients. Sam has an impressive background in personal finance and business management.