New Title Ad Valorem Tax

New Title Ad Valorem Tax - House Bill 386

Effective March 1, 2013, title transfer fees will increase for new purchases and penalties will increase if the title it not processed within the allotted time frame, 10 days for dealers, and 30 days for individual sales. Every new title transfer will be assessed a Title Ad Valorem Tax, or TAVT, whether purchased from a Georgia Dealership or from an individual. Any vehicle purchase that is new to the taxpayer will be assessed a TAVT when the title is transferred and is due to the taxpayer’s local county Tag Office. Instant titles will no longer be processed at the State Department of Revenue. House Bill 386 has set the TAVT rate at 6.5% in 2013, 6.75% in 2014, and 7.0% in 2015. House Bill 386 allows the rate to increase up to 9% and will be determined by the State. There are two ways for the TAVT to be paid, either by the dealership where the vehicle was purchased or by the taxpayer when the title is transferred at their local county Tag Office. 

  1. Vehicles purchased from a Georgia dealer on or after March 1, 2013: Vehicles purchased from a Georgia dealer, whether new or used, will be subject to this tax. The TAVT is paid at the dealership when the vehicle is purchased and those proceeds are forwarded to the appropriate county Tag Agent. TAVT is paid in lieu of sales tax and the customer will no longer owe annual ad valorem taxes for their new purchase on their birthday (referred to as the Birthday tax) as long as they own the vehicle. Customers are still required to pay a tag renewal fee each year on or before their birthday.
  2. Vehicles purchased between individuals on or after March 1, 2013: Vehicles purchased from an individual, referred to as casual sales, will have the TAVT assessed when the title is transferred at their local county tag office. TAVT is calculated at 6.5% in 2013, on the value of the vehicle as determined by the Department of Revenue Motor Vehicle Division. The customer will not pay ad valorem tax on their birthday each year as long as they own the vehicle. Customers are still required to pay a tag renewal fee each year on or before their birthday.
  3. Out of State Residents moving to Georgia on or after March 1, 2013: Residents that are new to Georgia will pay 50% of their TAVT when the vehicle is registered and will pay the additional 50% within 12 months. TAVT is calculated at 6.75% in 2014, on the value of the vehicle as determined by the Department of Revenue Motor Vehicle Division. As long as the total TAVT has been paid, no additional taxes will be due as long as the customer owns the vehicle. Customers are still required to pay a tag renewal fee each year on or before their birthday.
  4. Vehicles purchased from an out of state dealer: Georgia residents who purchase a vehicle from an out of state dealer will be required to pay the entire TAVT to their local county tag office when the title is transferred. 

House Bill 386 has not changed ad valorem tax and tag renewal fees for vehicles currently owned by tax payers.