2023 Texas Statutes › Tax Code › Title 2 - State Taxation › Subtitle E - Sales, Excise, and Use Taxes › Chapter 152 - Taxes on Sale, Rental, and Use of Motor Vehicles › Subchapter C. Collection of Taxes › Section 152.047. Collection of Tax on Seller-Financed Sale

Sec. 152.047.  COLLECTION OF TAX ON SELLER-FINANCED SALE.  (a)  Except as inconsistent with this chapter and rules adopted under this chapter, the seller of a motor vehicle shall report and pay the tax imposed on a seller-financed sale to the comptroller on the seller's receipts from seller-financed sales in the same manner as the sales tax is reported and paid by a retailer under Sections 151.401, 151.402, 151.405, 151.406, 151.409, 151.423, 151.424, and 151.425.
(b)  If a note, mortgage, account receivable, or other document evidencing the purchaser's indebtedness to the seller of a vehicle sold subject to a seller-financed sale does not bear interest, it will be conclusively presumed that the total consideration for the sale is principal.
(c)  If a note, mortgage, account receivable, or other document evidencing the purchaser's indebtedness to the seller of a vehicle sold subject to a seller-financed sale bears interest, it is conclusively presumed that interest accrues and is paid by the purchaser on a straight line basis.
(d)  The seller shall add the tax imposed on a seller-financed sale to the sales price of the vehicle sold, and when added, the tax is:
(1)  a part of the sales price;
(2)  a debt owed to the seller by the purchaser;  and
(3)  recoverable at law in the same manner as the sales price.
(e)  Regardless of the accounting method used by the seller, the seller shall collect and pay the tax imposed on a seller-financed sale to the comptroller as the seller receives the proceeds of the sale.
(f)  If the seller fails to apply, not later than the 60th day after the date the motor vehicle is delivered to the purchaser, for registration and a Texas certificate of title for a motor vehicle sold in a seller-financed sale in accordance with Section 152.069, the seller is liable for all unpaid tax on the total consideration, and the tax is due and must be sent to the comptroller with the first report after the expiration of the prescribed period.
(g)  If a seller factors, assigns, or otherwise transfers the right to receive payments, all unpaid tax is due on the total consideration not reported at the time the agreement is factored, assigned, or otherwise transferred.  The seller shall report and submit the tax in the report period in which the right to receive the payment is factored, assigned, or otherwise transferred.  The seller may not take a deduction in the amount of tax due if a transfer at a discount is made.
(g-1)  Subsection (g) does not apply to a transaction by a dealer, as defined by Section 503.001, Transportation Code, in which the dealer:
(1)  sells a purchaser's account to a person registered under Section 152.0475 as a related finance company; or
(2)  grants a security interest in a purchaser's account but retains custody and control of the account and the right to receive payments in the absence of a default under the security agreement.
(h)  The comptroller may proceed against the purchaser in a seller-financed sale for the amount of any tax not paid by the purchaser.
(i)  The comptroller shall adopt rules and promulgate forms necessary to implement this section.
(j)  In addition to any other penalty provided by law, the seller of a motor vehicle sold in a seller-financed sale who is required to file a report as provided by this chapter and who fails to timely file the report shall pay a penalty of $50.  The penalty provided by this subsection is assessed without regard to whether the taxpayer subsequently files the report or whether any taxes were due from the taxpayer for the reporting period under the required report.
Added by Acts 1993, 73rd Leg., ch. 29, Sec. 4, eff. Oct. 1, 1993.  Amended by Acts 2001, 77th Leg., ch. 1263, Sec. 28, eff. Sept. 1, 2001.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 191 (S.B. 1617), Sec. 1, eff. July 1, 2007.
Acts 2011, 82nd Leg., 1st C.S., Ch. 4 (S.B. 1), Sec. 14.05, eff. October 1, 2011.