Source: http://www.window.state.tx.us/taxinfo/audit/mv/mv02.html
Timestamp: 2014-12-20 21:32:47
Document Index: 753596223

Matched Legal Cases: ['§152', '§152', '§152', '§152', '§152', '§152', '§152', '§152', '§152', 'art. 1528', '§30', 'art. 1528', '§29', '§\n502', '§ 773', '§152']

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Maintained by the Audit Division (Revised 04/2008)
EXEMPTIONS Church and Religious Societies
Consular Officers and Employees
Farm (Ranch) Exemptions for Specially Modified
Motor Vehicles Used on a Farm or Ranch Non-Exempt Vehicles Used on a Farm
or Ranch Farm Trailers Examples of Farm Use Vehicles
Fertilizer Spreader Mobilized Fertilizer Spreader
Trailers Used for Timber
Operations Interstate Motor Vehicle
Orthopedically Handicapped Person
Driver Exemption Transporting Exemption
Who May Claim the Exemption
Disabled Veterans or Former
Prisoners of War Public Agency - Definition
Public Agency Exemption
Lease to a Public Agency
License Plates Contractors Other Organizations Exempt by
Statute Federal Organizations State Organizations Volunteer Fire Department -
Definition Volunteer Fire Department
Exemption Vehicles Transported Out of State
Citrus Pest and Disease Management Corporation (Chapter 80 of Agriculture Code)
Societies (§152.088 and Rule 3.82)
A church or religious society is an organized group of
people regularly associating for the sole purpose of holding, conducting, and
sponsoring religious worship according to the rites of the sect.
An organization simply supporting and encouraging religion
as an incidental purpose, or furthering religious work, or instilling its
membership with religious understanding, may not qualify as a church or
A church or religious society is exempt from paying motor
vehicle tax if the vehicle is: designed to carry more than six passengers (includes buses
and vans), and
used primarily (at least 80% of the vehicle's operating
time) to provide transportation to and from church or religious services
This exemption does not apply to a passenger vehicle
registered for the personal or official use of a minister.
Consular Officers and
Employees - (Rule 3.63)
All diplomatic missions and their members, including
dependents, are required by federal law (22 U.S.C. Section 4303) to register
all motor vehicles that they own or lease, with the United States Department of
State, Office of Foreign Missions, Diplomatic Vehicle Office. The vendor of a motor vehicle sold in Texas must contact the
Office of Foreign Missions in order to determine the tax exempt status of a
purchaser. A statement will be provided by the Office of Foreign Missions to
the vendor indicating the tax exempt status of the purchaser for motor vehicle
sales tax imposed on the transaction. A copy of the statement must be kept by
the vendor for four years from the date of purchase. If the exemption is
denied, a selling dealer licensed under Transportation Code, Chapter 503, must
collect and remit the motor vehicle sales tax due. Note:
A U.S. citizen or a permanent resident of the U.S. working for a foreign consulate would not qualify for exemption from taxes.
(§152.081 and Rule 3.76)
A driver training vehicle is exempt from motor vehicle tax
if all of the following requirements are met. A driver training vehicle must: be titled in the name of the dealership,
be loaned free of charge to a public school,
be used exclusively in an approved standard driver
training course, and
display exempt license plates (the use of standard license
plates subjects the vehicle to tax).
A driver training vehicle is not exempt from motor
vehicle tax when used for: school transportation,
loan to a private or parochial school, or
anything other than driver training
Farm or Ranch (§152.091 and
Rule 3.72)
A farm or ranch is one or more tracts of land used to
produce crops, livestock or other agricultural products to be sold as a regular
course of business. Included are dairy farms, commercial orchards, commercial
greenhouses, feedlots and similar commercial agricultural operations that are the
original producers of agricultural products.
A home garden is not considered a farm or ranch.
for Specially Modified Motor Vehicles Used on a Farm or Ranch
Farm machines, trailers and semi-trailers used primarily for
farming and ranching including the rearing of poultry and use in feedlots are
exempt from motor vehicle tax. Tax liability or exemption is not
determined by the type of registration and titling required by the State
Self-propelled motor vehicles that are specially adapted for
primary use on a farm or ranch are exempt as farm machines. The vehicles must
be adapted for use in: the production of crops or rearing of livestock, including
poultry, or feedlots, or applying plant food materials, agricultural chemicals, or
feed for livestock For example, a truck which has a fertilizer spreader
attached to it would be exempt if primarily used in farming.
Vehicles Used on a Farm or Ranch
Specially adapted self-propelled motor vehicles whose only
purpose is the transportation of agricultural products or materials are subject
to motor vehicle tax. They do not qualify as exempt farm machines as defined by
motor vehicle tax law.
A pick-up truck is not exempt as a farm vehicle even though
it may have farm registration. Farm tractors are not included in the definition of a motor
A farm trailer is a trailer or semi-trailer (including
gooseneck trailers) that is used primarily as a farm or ranch vehicle. A farm
trailer must be used in the production of: food for human consumption, grass, feed for any form of animal life, or other livestock or
agricultural products to be sold in the regular course of business. A farm trailer used primarily by a farmer or rancher in
processing, packing, or marketing of the farmer's own livestock or agricultural
products is not subject to motor vehicle tax.
A farm trailer used exclusively in processing, packing, or
marketing agricultural products by an agricultural cooperative or gin is
subject to the tax, unless the cooperative can prove that the cooperative
itself is the original producer of all agricultural products being processed,
packed or marketed, and that those functions are being done at a location
operated by the cooperative.
of Farm Use Vehicles
NOT A MOTOR VEHICLE&nbsp;&nbsp;&nbsp;&nbsp; NO MOTOR VEHICLE TAX DUE
Mobilized Fertilizer Spreader
AN EXEMPT MOTOR VEHICLE
Effective September 1, 2011, in order to qualify for motor vehicle sales or use tax exemption, farmers and ranchers must register with the Comptroller and obtain a registration number.
Registration numbers must be indicated on the Application for Certificate of Title (Form 130-U) in Section 21, the “Exemption claimed under the Motor Vehicle Sales and Use tax Law because…” This includes motor vehicles purchased to be leased to qualifying farmers and ranchers. Vendors and county tax assessor-collectors will able to verify registration numbers through an online system.
Operations (§152.091 and Rule 3.72)
A timber operation is the production of timber including
land preparation, planting, maintenance, and gathering of trees commonly grown
for commercial timber.
A timber machine is a self-propelled motor vehicle specially
adapted to perform a specialized function for use primarily in timber
operations. Timber trailer is a trailer or semi-trailer designed for and
used primarily in a timber operation.
A retail sale, use, or rental of a timber machine or a
timber trailer is not subject to motor vehicle sales and use tax or motor
vehicle gross rental receipts tax if the timber machine or timber trailer is
used in growing, harvesting, processing, packing, and marketing of timber by
the original producer.
Timber Operators Tax Exemption
Effective September 1, 2011, in order to qualify for motor vehicle sales or use tax exemption, timber operators must register with the Comptroller and obtain a registration number.
Registration numbers must be indicated on the Application for Certificate of title (Form 130-U) in Section 21, the “Exemption claimed under the Motor Vehicle Sales and Use Tax Law because…” This includes motor vehicles purchased to be leased to qualifying timber operators. Vendors and county tax assessor-collectors will be able to verify registration numbers through an online system.
Interstate Motor Vehicles (§152.089)
Interstate motor vehicles, trailers, and semi-trailers are
exempt. An interstate motor vehicle, trailer, or semi-trailer is one which is
operated in Texas and in at least one other state or country and for which the
registration fees could be apportioned if the motor vehicle were registered in
a state or province of a country that is a member of the International
registration Plan. See Chapter 11 for more information on interstate motor vehicles
Licensed Child Care Facilities (§152.093)
Certain qualified residential child care facilities may
purchase, use, or rent motor vehicles tax-free. The motor vehicles must be used
primarily for transporting the children residing in the facility under a state
The child care facility must meet all of the following
Licensed under Chapter 42, Human Resources Code, to
provide residential care 24 hours a day to both: --
children who do not require specialized services or treatment,
children who are emotionally disturbed, and
The children are permitted by the license to live together
in a single residential group.
Nonprofit organizations are not exempt from paying motor
An organization incorporated under the Texas Nonprofit
Corporation Act is not exempt from paying motor vehicle tax.
Organizations funded by the state or federal government are
not automatically exempt from motor vehicle tax. In order to qualify for an
exemption, an organization must be either a public agency or exempted by a
specific statute. For more information, see Public Agencies in this chapter.
A Limited Sales Tax Exemption Certificate may not be used by
any organization to claim exemption from motor vehicle tax.
Person - (§152.086 and Rule 3.84)
An orthopedically handicapped person is someone with limited
movement of body extremities and/or loss of physical functions.
For the purpose of claiming an exemption from the motor
vehicle tax, the person must be either unable to operate, or be transported in,
a motor vehicle unless it has been specially modified.
Driver Exemption:
A vehicle purchased to be driven by an orthopedically handicapped person is
exempt from motor vehicle tax if the vehicle is driven primarily by the
orthopedically handicapped person, and if the vehicle is modified to: (1)
facilitate operation by an orthopedically handicapped
driver by altering conventional controls for the brakes, accelerator, or
steering wheel, or
allow an orthopedically handicapped driver to enter the
vehicle by installing a wheelchair lift, hoist, or ramp.
The driver must present to the county tax assessor-collector a restricted Texas driver's license which requires a modification restriction on the vehicle or an
invoice or other document from an installer of special equipment which
describes the modification and the vehicle being modified.
Transporting Exemption:
A vehicle purchased to transport an orthopedically handicapped person is exempt
from motor vehicle tax if the vehicle: has been modified for transporting an orthopedically
handicapped person by installing a wheelchair lift, hoist or ramp, special
seat restraints, or wheelchair hold-down clamps, and
is used primarily to transport the orthopedically
The purchaser must present to the county tax assessor-collector an invoice or
other document from an installer of special equipment which describes the
modification and the vehicle being modified for transporting an orthopedically
Who May Claim the Exemption?:
The exemption for orthopedically handicapped persons applies
to individuals, partnerships, corporations, or associations, as long as the
Beginning January 1, 2010, a dealer selling a motor vehicle may not collect the motor vehicle sales tax when a purchaser claims an exemption for an orthopedically handicapped person when the purchaser signs a properly completed Exemption for Orthopedically Handicapped Person (Form 14-318) at the time of the sale. The purchaser must provide a copy of the restricted Texas Driver License indicating the required modification to the motor vehicle or provide a statement from a practitioner of the healing arts (included on the exemption certificate) certifying that the person is orthopedically handicapped and that the motor vehicle must be modified in order for the person to drive the vehicle or be transported by the vehicle.
The dealer must retain the exemption certificate and provide a copy of the certificate to the County Tax Assessor-Collector at the time of title transfer. The dealer who accepts the exemption certificate in good faith does not have any responsibility to investigate the purchaser's claim, and the dealer will not incur any liability for any taxes later found to be due.
The exemption certificate is available at the Comptroller's Web site at:
www.window.state.tx.us/taxinfo/taxforms/14-forms.html.
A disabled veteran or former P.O.W. is not automatically exempt from the
motor vehicle sales and use tax. A disabled veteran or former P.O.W. must be an
orthopedically handicapped person as defined in this section to qualify for an
exemption from motor vehicle tax.
Public Agency (§152.082)
A public agency is a department, commission, board, office,
institution, or other agency of the State of Texas, or of a county, city, town,
school district, hospital district, water district, or other special district,
authority, or political subdivision created by or pursuant to the constitution
or the statutes of this state. The term also includes the unincorporated
agencies and instrumentalities of the United States.
An organization is not a public agency simply because it is
funded by the state or federal government. An organization may be state or
federally funded and still not be entitled to an exemption from motor vehicle
A public agency is exempt from payment of motor vehicle tax
if the vehicles are operated with exempt plates and are titled in the name of
A limited sales tax exemption certificate may not be used to claim exemption
from motor vehicle tax.
Lease to a Public Agency (§152.083)
A leasing company acquiring a motor vehicle to be leased to
a public agency is not required to pay motor vehicle tax as long as the vehicle
is: titled in the lessor's name, leased to a public agency, and operated with exempt license plates. The leasing company is required to pay motor vehicle tax on
the book value of the vehicle at the termination of the lease unless the
vehicle is held exclusively for resale. For more information refer to Chapter
To qualify for the exemption, exempt license plates must be displayed.
However, the exempt plate requirement cannot be enforced on federal vehicles.
This requirement also is waived for undercover law enforcement vehicles. Exempt
plates are issued for undercover vehicles, but are then traded for
non-traceable regular plates.
A contractor working on a public agency project is not
exempt from motor vehicle tax. An exemption granted under the Texas Limited
Sales and Use Tax Act is not valid for motor vehicle tax.
Other Organizations Exempt by
In addition to public agencies, other organizations are
exempt from motor vehicle tax by particular statutes. These organizations are
not required to operate their vehicles with exempt license plates in order to
qualify for the exemption. Listed below are some examples of such
Federal Home Loan Mortgage, Inc., and other Federal Home Loan Banks
Boy Scouts and Girl Scouts. The Boy Scouts and Girl Scouts have been determined
to be instrumentalities of the federal government and are exempt from motor
vehicle tax. State Organizations:
Rural Electric Cooperatives, organized under the Electric
Cooperative Corporation Act, Tex. Rev. Civ. Stat. Ann. art. 1528(b), §30
Telephone Cooperatives, organized under the Telephone
Cooperative Act, Tex. Rev. Civ. Stat. ANN. art. 1528(c), §29
A volunteer fire department is any company, department or
association organized to answer fire alarms, extinguish fires and provide
emergency medical services. The members of a volunteer fire department receive
either no compensation or nominal compensation for their services.
A fire truck, ambulance, or other motor vehicle used
exclusively for fire-fighting purposes or for emergency medical service is
exempt from motor vehicle tax when purchased by a volunteer fire department.
Private ambulance services are exempt. Other fire departments will probably be
exempt as public agencies. For more information refer to the Transportation Code §
502.204 and the Health and Safety Code § 773.003
Vehicles Transported Out of
State (§152.092)
Motor vehicle tax is not due on the retail sale of a motor
vehicle that is transported out of Texas prior to any use in Texas other than
the transportation of the vehicle out of the state. The motor vehicle would
have to be taken out of Texas, permanently, within 20 working days from the
date of purchase to qualify for this exemption.
In order to qualify for this exemption, the purchaser of the motor vehicle
must sign, at the time of the purchase, an exemption certificate that:
is on a form designated by the Comptroller;
contains all the information that the Comptroller
considers reasonable;
is signed by the purchaser, and
provides that the purchaser, by signing the certificate,
authorizes the Comptroller to provide a copy of the certificate to the
state of intended use and registration.
If the vehicle ever re-enters Texas, use tax is due based on
the total consideration. Credit would be allowed for a legally imposed sales or
use tax paid to another state.
A vehicle that has been exempted under this provision, that
later is brought back into this state by the purchaser who intends to establish
residence in Texas, is not eligible for the new-resident tax. Use tax would be
due on the vehicle with credit allowed for tax paid to the other state.
Form 14-312 —
Exemption Certificate for Vehicles Taken Out of State
Effective September 1, 2007,
an ultra low-emission motor vehicle that is hydrogen-power capable and has a
fuel economy of at least 45 miles per gallon, or that is fully
hydrogen-powered, is exempt from Texas motor vehicles and use tax. A
qualifying hydrogen-powered motor vehicle is a vehicle that meets Phase II
standards established by the California Air Resources Board as of September 1,
2007, for an ultra low-emission vehicle II or stricter Phase II emission
standards established by that board.
Effective September 1, 2009, the Agricultural Code was amended, by adding Chapter 80, to provide an exemption from motor vehicle sales and use taxes for the Texas Citrus Pest and Disease Management Corporation. This Texas nonprofit corporation is a quasi-governmental entity formed to control and suppress the Asian citrus psyllid, a citrus pest. The corporation operates under the supervision of the Texas Department of Agriculture.
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