ATTENTION NC DEALERS
“Tag & Tax Together” Dealer Information
Effective Sept. 1, 2013, DMV will collect title fees, highway use taxes, registration plate
fees and vehicle property taxes. (Vehicle property taxes will appear on license plate renewals
beginning with those expiring Sept. 30, 2013.) A dealer may choose not to collect personal
property tax at the point of sale and the vehicle owner will be issued a Limited Registration
Plate as noted below.
The NCDOT website has a “Business Partner Resources” Connect NCDOT link where you can
view and print “Approved Dealer Educational Courses”, “Dealer License Minimum
Requirements”, “NC Title Manual”, “NC Dealer Manual” and a “Dealer Tag & Tax Together”
information sheet containing questions and answers which will be updated.
The NCDOT website has a link for the new “Tag & Tax Together” program containing general
Will a dealer be required to collect personal property tax at the point of sale?
No, pursuant to the statutes Implementing the “Tag and Tax Program,” a dealer will not be required to collect personal property tax from a vehicle owner. If a dealer chooses not to collect property tax, the owner will receive a limited registration plate (LRP), issued by dealers using online titling systems, or the license plate agency, with a T (for temporary) sticker that will expire no earlier than 60 days after the vehicle is titled.
Are property taxes due on a newly purchased vehicle when it is titled?
Beginning 9/1/13, vehicle property taxes are due at the time the title work is done, but payment may be delayed if the dealer chooses not to collect property tax. If payment of vehicle property tax is delayed, the owner will receive a limited registration plate (LRP), issued by dealers using online titling systems, or a license plate agency, with a T (for temporary) sticker. The T sticker will expire no earlier than 60 days after the vehicle is titled. When the LRP is delivered to the owner, a Limited Registration and Property Tax Notice stating the amount of the vehicle property taxes due will also be provided by the dealer or the license plate agency.
If a dealer does choose to collect personal property tax, can a vehicle owner elect not to pay at that time?
Yes, if a dealer chooses to collect property tax, the vehicle owner can still elect not to pay the property tax at the point of sale and the owner will receive a limited registration plate (LRP) as noted above.
Will owners receiving a limited registration plate (LRP) receive any additional notice from DMV?
Yes, a reminder notice will be mailed to the owner directly by DMV including the same billing information provided on the combined Limited Registration and Property Tax Notice given to the owner when the LRP was issued.
How will the customer and the dealer know how much property tax is due?
If the dealer chooses to collect personal property tax or would like to make the inquiry for their customer, a website is available at https://connect.ncdot.gov/business/DMV/Pages/Car-Dealers.aspx to provide that information based on the cost of the vehicle and the address at which the vehicle will be domiciled. The dealer can also call (919) 814-1779 for assistance.
Is there a different website for estimates than the one on which the taxes will ultimately be calculated?
Both the estimator and final tax bill will be drawn from the same database. The web site requires the user to enter the price of a vehicle and the address where the vehicle is domiciled (also known as the situs address). Tax rates vary by jurisdiction and can include special rates that apply only in parts of some localities, so entering the correct
address is critical. Tax rates can change and are almost always set on July 1, so an estimate made in June may not be accurate if the transaction actually happens in July. The tax amount due will be determined based on the date of the transaction. If a dealer does choose to collect personal property tax for a vehicle owner at the point of sale, the amount listed on the estimate will be deemed the actual tax amount and will not be subject to change when remitted to DMV or a license plate agency. For example, if the tax rates change between the date the vehicle was sold and the paperwork is submitted to DMV, the tax estimate provided on the date the vehicle was sold and tax was collected by the dealer, will be deemed the sufficient amount owed.
If the owner has residences in multiple counties, which county tax rate would we use for the property tax?
The owner will designate where the vehicle will be primarily domiciled (situs address). The property tax will be based on that address. The vehicle file can have a residence address, a mailing address, a vehicle location (situs) and a one-time address.
If there is a trade in vehicle, is the property tax based on the purchase price less the trade in?
No, the property tax is based on the selling price of the vehicle (dealer sales only) regardless of a trade. Highway use tax, on the other hand, will still be based on the selling price less the trade-in.
If a plate is to be transferred from another vehicle, will the property taxes be due?
No, the taxes will be due on the next renewal date for that plate, based on the value of the vehicle on which the plate is attached.
Does property tax need to be listed on the Bill of Sale?
If the dealer collects the property tax, the property tax should be listed on the Bill of Sale. If the dealer does not collect the tax, it should not be listed.
Will an expiration date sticker be issued for the Limited Registration Plate (LRP)?
Online dealers will issue the LRP and temporary (T) sticker. When the title work is done and the metal plate is issued by the license plate agency, a T sticker will be issued along with a Limited Registration and Property Tax Notice stating the amount of the vehicle property taxes due. When property taxes have been paid, a year sticker will be issued to replace the limited registration sticker on the plate already issued.
Does the dealer have to collect the property tax if he issues a 30-day marker?
No. Property tax may be collected and paid through the license plate agency, which will allow issuance of a permanent plate with expiration 12 months later, but the LRP option is available for vehicles with a 30-day marker.
Does property tax need to be on the 30-day marker receipt?
No, the receipt only lists “title and license fees collected by the dealer.”
Should highway use tax be paid on the property tax?
Highway use tax should not be charged on the property tax.
Where will the customer pay the tax (after the sale) if they received the LRP with the T sticker?
Taxes can be paid direct to DMV on-line, by mail, or at any license plate agency.
Can a dealer charge an extra fee to collect the tax?
No, but dealers can still continue to charge administrative or doc fees, which must be disclosed under current regulations already in place.
What will happen if the customer does not pay the property tax after the 60 day period?
The plate will be expired and the operator would be subject to a citation if the vehicle is driven, interest will be accruing on late payments, and a valid sticker would not be issued until the tax and accrued interest is paid.
Does the 15-day grace period for an expired tag also apply to the limited registration plate (LRP) with the T sticker?
No, the limited registration plate (LRP) marked with a T sticker will expire no earlier than 60 days after
the vehicle is titled and at the end of the particular month. There will be no 15-day grace period extending into
the month after expiration for the payment of property tax.
Who will grant any exemptions, like for active duty military?
The county tax office will handle any exemptions and should be contacted with those questions.
If I collect the property tax and the customer returns the vehicle before I go to the LPA, should the tax be
returned to the customer?
Yes, any fees and taxes should be returned to the customer and documented to protect yourself.
What if I collect the property tax and the customer returns that vehicle and gets another vehicle instead?
If the fees have not been paid to DMV, you would return everything and start over. If the fees have been paid to DMV, the customer would have to contact the county for their refund of property tax paid and pay full fees for the
second vehicle purchased.
Who should I contact if I have questions? i
f you have DMV-related questions about the Tag & Tax Together program, please call (919) 814-1779.