Motor Vehicle Tax Frequently Asked Questions

Q: How does the Tax Department determine what my motor vehicle is worth?
A. The Tax Department determines the value of motor vehicles by using a vehicle pricing guide published by Tax Equity Consultants (TEC). TEC provides vehicle manuals for all or nearly all 100 counties in North Carolina. The manual lists each model and make of all available motor vehicles and their market values. The vehicle's fair market value is multiplied by the tax rate to determine the amount of tax owed. Motor vehicle taxes are billed once a year.

Q: Is there a tax break for antique automobiles?
A. Automobiles that are individually owned, have antique license plates, are maintained primarily for use in exhibitions, club activities, parades, and other public interest functions, are assessed their actual value or $500, which ever is less. Antique automobiles that are used for the production of income or are used in conjunction with a business do not qualify for the special assessment.

Q: When are vehicle taxes due?
A. Motor vehicles taxes become due the 4th month after the vehicle has received a new registration or renewed its registration with DMV. Vehicle taxes must be paid in 30 days to avoid interest or penalties. The Tax Department will block the vehicle’s registration with DMV if the taxes are not paid promptly. DMV will not send registration renewal cards to the owner of any vehicle that has a registration block. Registrations blocked for non-payment of taxes cannot be renewed until the taxes are paid.

Q: How do I appeal a motor vehicle assessment?
A. The assessed value of a vehicle can be appealed if the appeal is submitted within 30 days of the due date of the tax. A completed Motor Vehicle Appeal Form, along with supporting evidence can be mailed, faxed, or taken to the Tax Department.

Q: When I purchased my car, the dealership told me they would take care of the taxes and tags. Why did you send me a tax bill?
A. The dealership was referring to the state sales tax and the license plate. The bill you received from the County Tax Department is for the county personal property tax due on the vehicle.

Q: I received a tax bill on a motor vehicle that I have sold. What do I need to do?
A. If you transferred the license plate from the old vehicle to another vehicle, then you must pay the tax bill in full as it is billed. In this case, you will not be billed for the new vehicle until next year.

If you sold the vehicle and turned the license plate in to DMV, then you can submit proof that the vehicle was sold and a copy of the receipt from DMV (Form FS20) to the Tax Department and part of your taxes will be adjusted or refunded. The adjustment or refund will be based on the number of whole months left remaining on the registration before it expires.

If the taxes have not been paid, the amount due will be adjusted accordingly.

Q: If I move out of this state, what should I do with my North Carolina license plate?
A. You should turn the license plate in to DMV and send a copy of the turn-in receipt from DMV (Form FS20) to the Tax Department and part of your taxes will be adjusted or refunded. The adjustment or refund will be based on the number of whole months left remaining on the registration before it expires. If the taxes have not been paid, the amount due will be adjusted accordingly. You must also provide proof of registration in the new state to receive the refund.

Q: What do I need to do if my mailing address has changed? Do I need to let the Tax Department and DMV know?
A. The Tax Department needs to maintain a current address for all taxpayers. Click here for a Change of Address Form. This form should be mailed, faxed, or taken to the Tax Department.

In accordance with state law, you must also notify the Department of Motor Vehicles (DMV) when your address changes. DMV records are what the Tax Department uses to determine which taxing district you are in and where to mail your tax bill. The wrong address on DMV's records could result in your paying too much tax and in not receiving your license plate renewal cards and decals on time. Click here to visit the DMV Website.

Q: How do I apply for an active-duty Military Exemption for my vehicle?
A. If your home of record is not North Carolina, you do not have to pay personal property taxes on your motor vehicles. The vehicle must be registered in the name of the service member (or the service member and spouse) in order to qualify for the exemption. The service member can submit their latest Leave & Earnings Statement (LES) or other proof showing their home state of record to the Tax Department. The documents can be submitted by mail, fax, or in person. The exemption is valid until the expiration date on the LES or the service member becomes a legal resident of North Carolina.

Q: Is the tax rate different for motor vehicles?
A. The tax rate on vehicles is the same for all other personal property and real estate.