Gifting a Car in South Carolina
To gift a car in South Carolina, transfer the title to your giftee and mark the sale price as $0.
Written by Drew Waterstreet
Edited by Pat Roache
When you gift a vehicle in
South Carolina
, you’ll need to transfer the title and make sure the sale price is listed as “$0.”- When gifting a new car, consider bringing your recipient to the dealership so they can be involved in the car buying and financing processes.
- Recipients of a gifted used car do not have to pay vehicle sales tax, use tax, or casual tax in South Carolina.
- A bill of sale is only required for gifted vehicles from before 1987, but they’re still a good idea in case you run into any legal or tax issues down the road.
- When gifting a new car, consider bringing your recipient to the dealership so they can be involved in the car buying and financing processes.
- Recipients of a gifted used car do not have to pay vehicle sales tax, use tax, or casual tax in South Carolina.
- A bill of sale is only required for gifted vehicles from before 1987, but they’re still a good idea in case you run into any legal or tax issues down the road.
How to buy a car as a gift in South Carolina
- You can be sure the recipient is getting a car that they’ll enjoy in the long term.
- The recipient can be involved in the financing process if you need to pay for the new car with acar loan.
Keep in mind: A vehicle title can not be transferred as a gift if there is an outstanding
lien on the car
. However, you can always co-sign the loan and assume the financial responsibility of monthly payments for the recipient of your gift.MORE: Car Loan in South Carolina
How to gift a used car in South Carolina
Gifting a used car is cheaper than gifting a new vehicle, but it requires a title transfer and some additional fees to consider.
1. Negotiate the terms of the gift with your recipient
Unfortunately, gifting a car isn’t completely free. Here are some associated fees that you can expect to pay:
- Original vehicle certificate of title: $15
- Vehicle title transfer: $15
- Infrastructure maintenance fee: 5% of the purchase price ($500 maximum)
Luckily, the fees stop there. Under South Carolina Code Section 12-36-1720 and SC Revenue Ruling #92-10, the vehicle is exempt from the following:
- Sales tax
- Use tax
- Casual tax
As the law puts it, there has been “no sale.” Rather, the transfer of ownership has been executed through “love and affection.”
What to do: Discuss the fees with your gift recipient and determine who will pay for what. Don’t forget to take the long-term costs of car ownership into account, like
car insurance
and maintenance.2. Record of the gift with a bill of sale
In South Carolina, a bill of sale must be presented before transfer if the vehicle title was issued before June 19, 1987.
A bill of sale is also a useful thing to keep in your records if there are any legal or tax implications regarding the transfer.
3. Transfer the vehicle title
Now that you've hashed out the details of your gift, it’s time to head to your local South Carolina Department of Motor Vehicles (SCDMV). Here’s a step-by-step guide to completing the South Carolina title transfer process:
- The vehicle owner and the giftee must sign the back of the title
- The gifter should write “$0” in the price section of the vehicle’s title
- Both parties should fill out anApplication for Certificate of Title (Form 400)
Once you’ve completed all of the paperwork at the DMV office, your gift recipient will have 45 days to register the vehicle once you’ve completed the title transfer with the SCDMV. An emissions test is not required for South Carolina registration, thanks to the Clean Air Act.
4. Purchase South Carolina liability insurance—or full coverage
The new owner will need to purchase the following amounts of
liability auto insurance
to legally drive their gifted vehicle:Your gift recipient may want to consider a
full-coverage insurance
policy, so long as it doesn’t outweigh the gifted car’s value.“This app is all about savings!Jerryjust saved me $193/month on my car insurance. They literally found me the cheapest policies out there and with better coverage! Seriously, just sit back and watch Jerry work its magic.” —Rachel B.
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FAQs
Do you have to pay taxes on a gifted car in South Carolina?
No, recipients of gift cars are exempt from sales tax, use tax, and casual tax. However, there is a fee to execute the title transfer and an infrastructure maintenance fee.
Is it better to gift a car or sell it for $1 in South Carolina?
Gifting a car in South Carolina is the more legitimate way to pass on a vehicle, and it is the only way to avoid paying sales, use, and casual taxes.
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