This online news website is owned and operated by Becky Watts. The Editor can be reached at 770-468-7583 or at editor(at)PikeCountyTimes(dot)com. Pike County Times is a website for citizens to keep up with local events and stay informed about Pike County government. It began on November 13, 2006 as a watchdog on county government and has turned into an online newspaper.
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By Editor Becky Watts
ZEBULON - House Bill 386 was passed by the 2012 General Assembly. It creates a new way to pay taxes on vehicles bought on or after March 1, 2013. There will now be a one-time title ad valorem tax (TAVT) that will be required instead of the annual ad valorem “birthday tax”.
“Titled self-propelled motor vehicles” includes cars, trucks, motorcycles, and any other vehicle that can fit this category and all new and used vehicle sales will be subject to this new law. According to the Georgia Department of Revenue, the TAVT will be a one time tax that is based on the fair market value of the vehicle which will be calculated according to 100% value listed in Georgia’s Motor Vehicle Ad Valorem Assessment Manual or, if the used vehicle is not listed in the assessment manual, then the higher of the bill of sale or the National Automobile Dealers Association (NADA) value will be used. And if it is too new to be in the assessment manual or NADA book, the bill of sale minus any rebates will be used.
According to the law, there will be an $18 title fee that will be due within 30 days along with a percentage that is set by the state for the TAVT fee. In 2013, this will be 6.5% of the fair market value of the vehicle. In 2014, it will increase to 6.75% and go up to 7.0% in 2015. After 2015, the rate may be adjusted, but according to the Georgia Department of Revenue, it will never go higher than 9.0%. In addition to the TAVT fee, there will be a $20 registration fee that will continue to be charged annually.
The TAVT is due within 30 days of the date of sale. If the TAVT is not paid within 30 days of the sell date, a 10% penalty will be assessed and the owner will also be changed a $10 late fee. On Day 61, another 1% penalty will be added and 1% will be added every 30 days after this until the title work is submitted to the county in which the buyer resides. If a vehicle is purchased at a dealership, the dealer will accept the title application and the TAVT payment and send it to our county’s tag agent. And the Department of Revenue says that value can be appealed in the same way that values for ad valorem tax purposes are appealed.
This law will not affect trailers, pull behind campers, and non-titled vehicles including vehicles manufactured prior to 1963 and any 1963 to 1985 year model vehicle that does not have a current Georgia title. These vehicles will continue to be on the “birthday tax” system. Any vehicles that are currently being paid on the “birthday tax” system will also continue to be paid on an annual basis as they are now.
Titles can be transferred to immediate family members under this new law with “immediate family member” being defined as a spouse, parent, child, sibling, grandparent or grandchild. Whether this transfer will be subject to the TAVT will depend on whether the former owner paid TAVT or not. If the TAVT has been paid, then there will only be a 0.50% (one half of 1%) TAVT along with the title and registration fees. There is no option to revert back to the “birthday tax” system. If the TAVT has NOT been paid and the owner was under the “birthday tax” system, the family member can either continue paying annually or choose to pay the full TAVT to be a part of the new system.
For those moving into Georgia, TAVT can be costly because the TAVT will be required along with title and registration fees on each vehicle. However, because this could be a major hardship, the state will allow new residents to pay one half of the TAVT at the time of application and the remaining amount within 12 months.
There is an opt-in option that is being allowed by the State of Georgia. Anyone who purchased a vehicle between January 1, 2012 and March 1, 2013 will be allowed to choose whether or not to be a part of the TAVT system. Sales tax and ad valorem taxes already paid will be taking into consideration in the amount owed according to the TAVT system. The state will be sending letters out to owners who qualify for this. The deadline to opt into the TAVT system is December 31, 2013.
One note of importance is that vehicles owned by veterans who would receive an exemption from ad valorem tax will also be exempt from the TAVT. Other important notes are that salvage vehicles will be subject to a TAVT of 1% of the fair market value and donations to 501(c)(3) non-profit organizations are also subject to a 1% TAVT fee when the vehicle is titled in the name of the non-profit organization.
Click here to use the Title Ad Valorem Tax Calculator to help understand how the new TAVT applies to new motor vehicle purchases.
Click here to read frequently asked questions and have them answered by the Georgia Department of Revenue.
The Tax Commissioners’ Office can also answer questions at 770-567-2001.