Trading vehicles

[Guest Fenris]

If two people want to swap cars straight up with no money changing hands, how do you fill out the titles and how do you figure taxes in TN?

[nightrunner]

put down what the approxiamate value of each car is on the respective titles.

for example you are trading your car for mine. my car is worth $2,000 and yours is worth $3,000. i put $3,000 worth trade in on my title. You put $2,000 worth trade in on our title. might have to put vin numbers down too, i cant remember. this is if you want to pay full taxes. depending on the cars you can usually get away with lowering sale prices and paying less in taxes if both parties agree or if the titles sale price is left bank for the buyer to fill out.

[Smith]

I think the DMV is using blue book value or something similar to prevent low ball values. They will estimate it's value generically if they think it is low or blank.

[Guest coldblackwind]

There's a form you have to fill out. I kinda think you have to pay tax on the new one anyways, but I won't swear to it. My buddy had to on an el camino, but it was the first time it was registered in this state, and he didn't have any info on the truck he traded for it.

[Guest clsutton21]

I think the DMV is using blue book value or something similar to prevent low ball values. They will estimate it's value generically if they think it is low or blank.

While I would never do anything illegal like tax evasion...if you happen to get an older vehicle, you could put that it was only bought for $50 if you tell them it is a fixer upper.

[Guest coldblackwind]

I think the DMV is using blue book value or something similar to prevent low ball values. They will estimate it's value generically if they think it is low or blank.

They like to use book value, but you can get around it. First off, if you don't set the price much below book your fine, or theres a form to fill out if you set the value less than they accept, or do it as a gift. I had to do one on a neon I sold a guy, it was well below book, but the rods were bad, so I wasn't gonna make him pay book for it.

[oldogy]

Why not talk to the DMV, talk to the person in charge, not some clerk. Tell them there is no cash changing hands. I do not see where you would pay tax at all. But then I look at things logically. To explain it farther, you are giving him your vehicle and he is giving you his vehicle. If you are trading the vehicle at a dealer you pay tax on the difference, there is no difference so no tax.

oldogy

[VolunteerGuns]

Even trade will leave neither seller or buyer liable for sales tax. As a dealer, we list the sales price as even trade and list the year, make, model and VIN in the spot on the back of the title that is for trade in info.

As far as the "fixer upper" one can get the affidavit from clerks office. The seller must list the sale price along with explanation for the low price. I will tell you from past experience that in this case an explanation of "vehicle in need of major repair" works every time.

[MudBugjr]

you can download that affidavit on the tn.gov website.

[Guest Fenris]

Thanks for the responses. I have used a gift affadavit before when someone legitimately gave us a car and all I had to pay was the $12 fee to transfer my tag.

I didn't know if me gifting a car to someone and someone gifting a car to me would look fishy. I do plan to talk to the DMV but didn't know if anyone had experience with this.

Thanks again.

[MudBugjr]

What ever the amount of your trade in is non taxable money!

[broylz]

i just bought a truck from my dad and the sale price on the title was 100bucks. the lady questioned it but saw the seller was my dad. didnt think twice about it after that. didnt need an affidavit or anything of that sort.

edited to add: i am also in the military so i didnt have to pay the tax anyway. maybe that has more to do with it in my situation.