Vehicles Purchased From Dealers & Casual Sales:

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Dealer Sales:

If the vehicle is purchased from a Dealer or a Leasing Company, the tax is 3% of the purchase price, less any trade in credit. A bill of sale must accompany each application.

Casual Sales:

Vehicles purchased from anyone other than a dealer must pay a 3% tax based on the vehicle's value according to a value table maintained by the North Carolina Division of Motor Vehicles.

Out-of-State Residents:

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All transactions involving a vehicle already titled in the customer's name from another state 90 days prior to registering in North Carolina will be taxed on vehicle value, with a maximum of $150.00 being assessed. If owned less than 90 days before applying for North Carolina Title, tax credit against the highway use tax due will be allowed for the amount of tax paid to the other state upon submission of proof of payment. If the vehicle was titled in North Carolina after 90 days of purchase from a dealer, no credit would be allowed. Full highway use tax would be due on the purchase price, less any trade-in credit.

Military Service Personnel:

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Military personnel (residents and non-residents) registering a vehicle in North Carolina are not exempt from paying the Highway Use Tax

Overseas Vehicles:

Tax due at 3% of the purchase price if purchased from a dealer or 3% of the computer schedule value if casual sale (whether they are a resident or non-resident). Vehicles purchased overseas by military personnel with military registration are taxed at 3% not to exceed $150.00. Vehicles purchased overseas without a registration being issued no maximum tax due. 3% of Bill-of-Sale price will be collected. Notarization is not required from foreign countries; however, a completed assignment or a Bill-of-Sale is required.

Mobile Homes:

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Mobile Homes sold by a dealer are subject to a 2% sales tax with a $300.00 maximum. The sales tax is due on each section of doublewide mobile home. The sales tax is paid to the dealer who then reports it to the Department of Revenue. If the mobile home is purchased from an individual or someone other than a dealer, no tax is due.

Special Mobile Equipment Tax:

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Special Mobile Equipment is subject to a 7% sales tax with no maximum if purchased from a person or firm engaged in the business of selling, leasing or renting special mobile equipment. Credit for a trade-in is not allowed on the purchase price.

Exemptions from Highway Use Tax:

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Vehicles already titled within North Carolina have certain exemptions from the Highway Use Tax (HUT) such as:

• An insurance company obtaining a salvage title for a vehicle for which a total loss claim was paid.
  
  
• When transferring a title to a manufacturer or retailer for the purpose of resale.
  
  
• When making a name-change or name-correction to a title.
  
  
• If the vehicle is transferred by a will or intestacy.
  
  
• If the vehicle is a gift between a husband and wife, a parent and child or a stepparent and a stepchild. This exemption does not include out of state title transactions, only North Carolina title transactions apply.
  
  
• If the vehicle is transferred as a result of the distribution of marital or divisible property incident to a marital separation of divorce.
  
  
• To a handicapped person from the Department of Health and Human Services after the vehicle has been equipped by the Department for use by the handicapped.
  
  
• To a local board of education for use in the driver education program of a public school when the vehicle is transferred by a retailer and is to be transferred back to the retailer within 300 days after the transfer or transferred by a local board of education.
  
  
• To a volunteer fire department or volunteer rescue squad that is not part of a unit of local government, has no more than two paid employees, and is exempt from State income tax under G.S. 105-130.11, when the motor vehicle is one of the following:
  • A fire truck, a pump truck, a tanker truck, or a ladder truck used to suppress fire.
  • A four-wheel drive vehicle intended to be mounted with a water tank and hose and used for forest fire fighting.
  • An emergency services vehicle.