So my friend wants to give his car to another friend as a gift. What all documentation needs to be completed?

Obviously Friend 1 has to sign the title. What comes after that?

Is the other friend one of these folks? if not, they don't qualify for gift registration. As long as they're on the list below, they only need to fill out this form and the 130U

https://www.txdmv.gov/sites/default/files/form_files/14-317.pdf

Quote:

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To qualify for the $10 gift tax rate, a motor vehicle must be received from one of the following eligible parties:
spouse (separate property only; vehicles held as community property are not subject to the tax);
parent/stepparent; father/mother-in-law;
grandparent/grandparent-in-law or grandchild/grandchild-in-law;
child/stepchild; son/daughter-in-law;
sibling/brother-in-law/sister-in-law;
guardian;
decedent's estate (inherited/willed or through an Affidavit of Heirship for a Motor Vehicle);
nonprofit service organization qualifying under Internal Revenue Code (IRC) Section 501(c)(3), (gift tax applies when the 501(c)(3) organization is the donor or the recipient); or
certain revocable (living) trusts, typically used in estate planning, described in Tax Code Section 152.025.

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Yeah they would not be on this list. Just a normal person if that makes sense. Appreciate the response!

Your friend sounds like a good person. He can still give the car, the county will assign a value and charge the recipient sales tax on the car's value.

If the recipient can't afford the tax and the registration, your friend can always go the second mile, and give him cash to cover those fees.

mrmill3218 said:

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So my friend wants to give his car to another friend as a gift. What all documentation needs to be completed?

Obviously Friend 1 has to sign the title. What comes after that?

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If you transfer the title, sales tax will need to be paid on the SPV. As long as he can trust the friend to get insurance and pay the registration, he can just keep the title in his name.

"As long as he can trust the friend..."

I have no idea their relationship.

Martin Q. Blank said:

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"As long as he can trust the friend..."

I have no idea their relationship.

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My opinion, trust all you want, but protect. If he's giving away the car, give away any potential liability.

Doesn't matter how great their friendship is if the friend plows into a school bus full of kids and lawyers descend with million dollar lawsuits against all involved, including the titled owner

If he wanted to go the route of keeping the title in his name to avoid taxes for a while, I would at least draw up a simple bill of sale noting a down payment of "x" with a payoff date of "y" (which could be several years in the future), so from a paperwork standpoint the vehicle is being sold which should help alleviate liability....in theory.

Then again, can just pay the taxes. The tax value is auto calculated by the state: https://www.txdmv.gov/standard-presumptive-calculator. If you ever buy a used car and pay more than this value you are filling out the paperwork incorrectly.