without paying taxes on it, you’ll need to submit a bill of sale, an affidavit for tax exemption, and a $25 gift fee with the $75 title transfer at the Massachusetts Registry of Motor Vehicles (RMV).

Consider bringing your gift recipient to the car dealer to involve them in the buying and financing process if you plan on gifting a brand new car in Massachusetts.
A used vehicle must be free of any liens before you can legally transfer ownership to a gift recipient.
List the purchase price as $0 or “gift” on your bill of sale and title transfer when you submit the application at the RMV.
You and your giftee should be prepared to pay Massachusetts’ $30 registration fee and $35 car inspection fee after the title transfer is complete.

How to buy a car as a gift in Massachusetts

The simplest way to

buy a new car

as a gift is to include your giftee in the car-buying process. Bringing your gift recipient to the dealership allows you to avoid a lot complications:

Your giftee will get to pick out and test drive the car they want, ensuring they don’t get stuck with a car they don’t like.

The dealer will involve your recipient in the paperwork, adding their name to the

certificate of title

and

vehicle registration

so you don’t have to.

If you need a

car loan

, your giftee can sign the financing agreement with you to avoid any legal complications that would prohibit you from transferring ownership.

Keep in mind: You cannot transfer ownership of a new vehicle with an active

car lien

on the title. The only way to finance a gifted vehicle is to cosign a car loan or leasing agreement with your recipient so the can still be added to the car title.

MORE:

Do dealerships verify insurance?

How to gift a used car in Massachusetts

Gifting a used car is typically cheaper, but it involves a bit more paperwork. To gift a used car in Massachusetts, you’ll need to:

Provide a

lien release

for the used car, if applicable.

Write a

bill of sale

with the purchase price as $0

Complete a

Massachusetts transfer of title

at your local RMV

Pay around $130 in fees for titling, gifting, and registration

Tax exemption: Your giftee will be able to avoid paying

Massachusetts sales tax

on their gift as long as you follow the legal procedure to transfer the vehicle as a gift as outlined below.

Step 1: Negotiate the terms of the gift with your recipient

Before you can start the transfer of car ownership, you should sit down with the new vehicle owner to discuss the financial logistics around car gifting and ownership.

Discuss the following costs with your recipient to determine who is going to pay for what:

Cost	Massachusetts average
Gift fee	$25
Title transfer fee	$75
Registration fee	$30
Vehicle inspection fee	$35
Car insurance	$2,412 ( liability insurance only) $2,547 ( full coverage ) per year
Car maintenance	$1,186 per year
Fuel	$1,500-$2,000 per year

MORE:

How to gift a car to a family member

Step 2: Record of the gift with a bill of sale

You’ll still need to complete a bill of sale to submit with your Massachusetts title transfer—even when the car is a gift and no money is exchanged. Be sure to include the following:

Write “gift” or “$0” as the purchase price.

Record the names of yourself and your gift recipient with signatures.

List the make, model, and

vehicle identification number

(VIN) of the vehicle.

Why it matters: A bill of sale will serve as legal proof of the transaction between the previous owner and the new owner, which can protect you from potential legal and financial confusion.

Step 3: Purchase Massachusetts liability insurance—or full coverage

Regardless of who’s paying the premium, your gift recipient will need to carry a valid auto insurance policy for their new vehicle per

Massachusetts minimum coverage requirements

Expert tip: Upgrade your giftee’s coverage to a full-coverage insurance policy to treat them to the best financial protection available.

MORE:

When should you drop full coverage on your car?

Step 4: Transfer the vehicle title

The most crucial part of the gifting process will be transferring the title at your local RMV office. This is technically the recipient’s responsibility, but it’s a good idea for the gift-giver to come along to avoid any complications.

Be prepared to submit the following required documents:

A completed

registration and title application form

The sales tax exemption form for a vehicle transferred within a family (

Form MVU-26

) or a vehicle transferred as a gift (

Form MVU-24

)

$25 gift fee

$75 title fee

Registration fees (typically $30)

You’ll also need to have the original title with the following information on the back of the title filled out:

Date of the transfer

Vehicle’s

odometer reading

Purchase price (“gift”)

Both new and previous owner’s signatures

What to expect: Your giftee will receive the registration certificate,

new license plates

, and expiration stickers in person and the new title will be mailed in six to eight weeks. They’ll also need to complete a vehicle inspection for a $35 fee within seven days of registration.

MORE:

Does Massachusetts require a front license plate?

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FAQs

Do you have to pay taxes on a gifted car in Massachusetts?

No: You’re exempt from paying sales tax on a vehicle if it was transferred from someone in the immediate family (parent, sibling, or child) or transferred as a gift.

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