TITLE AD VALOREM TAX (TAVT)
What is the Title Ad Valorem Tax (TAVT)?
O.C.G.A. § 48-5C-1 effective March 1, 2013 requires all Ad Valorem Tax to be paid on vehicles that require a title at the time of title application. These vehicles are exempt from sales and use tax and annual ad valorem tax, also known as the "birthday tax." TAVT is a one-time tax that is imposed on the fair market value (or taxable base) of the vehicle.
How is fair market value determined for new and used motor vehicles?
As of January 1, 2020, the tax base for NEW and USED vehicle purchases is the same: The retail selling price of the vehicle MINUS any reduction for the trade-in value of another vehicle AND MINUS any rebate on a new car. The exceptions are qualifying Buy Here Pay Here (BHPH) transactions.
How is TAVT calculated?
For New/Used Vehicle Purchases:
(Retail Selling Price) - (Trade-in Allowance) - (Rebate-New Vehicle) x (TAVT Rate of 6.6%) = TAVT OWED
For Lease Transactions of New/Used Vehicles:
(Total of Base Payments) + (Down Payment) x (TAVT Rate of 6.6%) = TAVT OWED
Buy Here Pay Here (BHPH)
For used vehicles sold by qualifying BHPH dealers, the tax base is the DOR Book value minus any trade, and their reduced rate of 2.5% below the applicable tax rate continues to apply. Thus, used vehicles sold by qualifying BHPH dealers are taxed according to the DOR Book value at the reduced rate of 4.1%.
How is the trade-in value determined?
As defined in O.C.G.A. § 48-5C-1, the “trade-in value” is the value of the motor vehicle as stated in the bill of sale for a vehicle which has been traded in to the dealer in a transaction involving the purchase of another vehicle from the dealer.
What is the TAVT rate?
As of January 1, 2020, the TAVT rate is 6.6%.
Where do I apply for my title and pay TAVT?
The application for title and TAVT payment must be submitted to the county in which the buyer resides. The TAVT must be paid at the time of initial title application. All dealers are required to process title applications electronically. TAVT is remitted upon submission of an electronic title application.
If I purchase a vehicle that does not require a title, do I still pay TAVT?
No. TAVT only applies to vehicles that are titled in Georgia.
ADDITIONAL TAVT RESOURCES
The Georgia Department of Revenue (GADOR) website provides a TAVT summary, FAQs, links to forms, TAVT calculator and more.