How to Gift a Car

If you’re feeling generous, you can give your car away for free. This happens more often than you might think, but usually for circumstances such as:

  • A family member just received their driver’s license
  • You bought a new vehicle and still have your old one to deal with
  • You can no longer drive for medical reasons
  • You know a family or individual in dire need

To make this process official, there are certain steps that should be made to make sure the car is properly transferred to the new owner. The gifting process may vary slightly depending on the state you live in, however, the general steps are listed below.

Part 1 of 3: Make an agreement with the recipient of the gifted vehicle

Step 1: Negotiate the terms of the gift. Gifting a vehicle for no financial gain doesn’t exclude you from discussing the terms of the vehicle transfer.

The responsibility for potential and ongoing expenses, such as insurance fees, fuel expenses, repair fees, and maintenance costs, should be clarified with the recipient so both parties are on the same page.

Determine who will pay fees and taxes associated with the title transfer process.

Visit your nearest DMV or check the DMV website to see what costs will be associated with your title transfer.

For example, in California, the title transfer fee is $15 plus taxes through the DMV. The fees and policies vary from state to state.

  • Note: If the recipient needs to pay sales and use tax on the gift, calculate the tax amount based on the NADA Official Used Car Guide price, an accepted market price guide, for the vehicle.
bill of sale form
Image: DMV California

Step 2: Write a sales agreement or bill of sale for the gift. It may seem unnecessary at the time, but the seller may still maintain liability for the car if there isn’t a contract in place for the gifted vehicle.

A contract or bill of sale will likely be required by the DMV at the time of title transfer anyway.

Have both the current owner and the recipient fill out the necessary sections of the bill of sale or agreement.

Part 2 of 3: Complete the transfer of title portion of your title certificate

Step 1: Verify that there are no liens outstanding on your car. You won’t be able to transfer your title with an outstanding lien on your car.

A lien on your car means that there is a third party that has a legal and financial interest in your vehicle because of a debt owed.

If there is a lienholder listed on your title, contact them to make arrangements to remove the lien.

If the funds are paid in full, it may be as simple as completing a discharge of loan through the DMV. You can visit the DMV lien removal page for more information.

You may need to finance your car loan in another fashion to remove the lien from the title. This can be done by closing your current loan through financial help from an outside lender such as Escrow.

  • When the lien has been discharged, you can proceed with the title transfer.

transfer of title section

Step 2: Fill out the transfer of title section. You will need to fill out the transfer of title section completely on the original car title.

  • Make sure to print the current mileage on the title transfer section.
gift filled into selling price
Image: DMV California
  • Write “GIFT” in the sale amount field on the title.

Step 3: File the title transfer paperwork. The simplest and most straightforward way to transfer your title to the car’s recipient is for both parties to go to the DMV branch and complete the paperwork.

  • A clerk at the office will ensure all the paperwork is filled out correctly and completely so there are no delays or problems.
statement of facts
Image: DMV California
  • You may need to fill out a Statement of Facts or another document stating the vehicle is being transferred as a gift so the recipient can be exempted from paying taxes on the transfer. You can learn more about your state’s policy on tax exemptions for vehicle gifts at the DMV website.

Part 3 of 3: Pay the title transfer fee and applicable state taxes

Step 1: Find the applicable fee amounts. If you are at the DMV office, they will let you know exactly how much will need to be paid.

  • If the recipient is shown as exempt from paying the sales and use tax online, they will likely still need to pay the title transfer fee.

Step 2: Pay fees and taxes. Pay the DMV fees for the title transfer and sales tax if applicable.

  • Once the fees are paid, the transfer is complete and the car has been gifted to the new owner.

Whether you are gifting your vehicle to a family or friend, there are certain steps that you need to make this process official. By following the guide above, the gift recipient can enjoy their new vehicle with the title successfully transferred under their name. If you are feeling extra generous, you can have a certified mechanic, such as one from YourMechanic, give your car a full inspection before handing off the keys. This will ensure that your gift is driving smoothly for its new recipient.


Schedule 75 Point Safety Inspection
Service Area

$0.00

Upfront, Transparent Price
Average rating from 413 customers who received a 75 Point Safety Inspection.

The statements expressed above are only for informational purposes and should be independently verified. Please see our terms of service for more details

Excellent Auto Repair Ratings.

4.2 Average Rating

Auto Repair

Service Hours

7 AM - 9 PM

7 days a week

Phone Number

Phone Hours

Mon - Fri / 6 AM - 5 PM PST

Sat - Sun / 7 AM - 4 PM PST

Address

We come to you at no extra charge

Guarantee

12-month/12,000-mile warranty

Service Area

Recent 75 Point Safety Inspection reviews

Excellent Rating


YourMechanic 75 Point Safety Inspection Service

Average Rating

4.8/5

Number of Reviews

413

Rating Summary
379
15
10
1
8
379
15
10
1
8

Pardeep

20 years of experience
736 reviews
Pardeep
20 years of experience
Ford Fusion - 75 Point Safety Inspection - San Jose, California
I have ordered a 75-point inspection of the car since my dealership claimed it had an oil leak and the timing cover replacement was due (this kind of repair costs in the ballpark of a thousand dollars). I mentioned the need for a second opinion on that since the car had been bought relatively recently from that dealer (certified pre-owned) and not very actively used. Pradeep performed the safety inspection in a very timely manner and addressed my main question by honestly concluding that there was no leak but just some dust collected over time. This has saved me much time and money. Finally, I was also very glad to learn a tip on how to find a matching paint for a body scratch from him.
Ford Escape - 75 Point Safety Inspection - San Jose, California
Pradeep immediately found the suspension problem I was worried about and fixed it. We had just purchased this car and now feel a lot better about it now that he has checked it out.

Honorio

18 years of experience
828 reviews
Honorio
18 years of experience
Hyundai Accent - 75 Point Safety Inspection - Sunnyvale, California
Honorio not only told me what is going on with the car but was so honest about everything. Looking forward to having Honorio taking car of my requests.
Acura RDX - 75 Point Safety Inspection - Palo Alto, California
Honorio went above and beyond my expectations. He was honest about which repairs needed to be done even though my service revision decreased his income. Will absolutely use again!!!! Thank you!

Christopher

11 years of experience
54 reviews
Christopher
11 years of experience
Jeep Wrangler - 75 Point Safety Inspection - Charlotte, North Carolina
Chris is very knowledgeable and helpful. Helped me with future maintenance decisions for my Orange Monster.

Scott

33 years of experience
390 reviews
Scott
33 years of experience
Nissan Rogue - 75 Point Safety Inspection - Denver, Colorado
Scott has been fixing my car for a few years now and he always does an excellent job, thoroughly explains what's wrong and is very friendly!

Need Help With Your Car?

Our certified mobile mechanics make house calls in over 2,000 U.S. cities. Fast, free online quotes for your car repair.

GET A QUOTE