I'm purchasing or acquiring a vehicle from my uncle (my father's brother). Will I have to pay tax when transferring the title into my name?

Yes - under Michigan tax law, relationships that qualify for tax exempt status are limited to vehicles purchased or acquired from a spouse, father, mother, child, brother, half-brother, sister, half-sister, grandparent, grandchild, legal ward, or legally-appointed guardian. Included are stepparents, stepbrothers, stepsisters, stepchildren, father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, and grandchild-in-law. All other relationships (cousins, aunts, uncles, nephews, nieces, step-grandparents, great-grandchildren, grandparent-in-law, etc.) are not tax exempt.

Owners may elect to follow a two-step title transfer process in which a tax exempt relationship applies. For example, your uncle could transfer the vehicle to his brother (your father), which would be tax exempt. Once the vehicle is re-titled in your father's name, he can transfer the title to you which would be tax exempt.

Related Documents & Topics

 

 

 

If you did not find the information you need, enter a descriptive word or phrase in the Search field located in the upper right corner. Or send us an e-mail by clicking on “Contact the Secretary of State” also in the upper right corner and we will help you get the information you need.