Does North Carolina Have a Personal Property Tax on Cars?

North Carolina counties send out personal property tax bills.

North Carolina counties send out personal property tax bills.

All states assess taxes on cars, usually a highway use or sales tax, at the time of purchase and require annual registration fees. A few states require payment of an annual vehicle or property tax on cars. The North Carolina Department of Motor Vehicles and the revenue departments of the state’s 100 counties share information to apply the state’s personal property tax laws.

Vehicle Property Tax

North Carolina charges an annual personal property tax on cars. The state requires the counties to assess and collect property taxes on cars registered with the Department of Motor Vehicles, or DMV. While each state has its own method for calculating property taxes, not all levy them on cars. While North Carolina does charge the tax, Forbes online magazine ranks the state low among the group of states that have property taxes on cars. North Carolina exempts some motor vehicles, like cars leased or owned by public agencies.

Tax Assessment

The Department of Motor Vehicles, or DMV, provides county tax offices with records that list the makes and models of registered cars. County tax assessors use the information to determine the value of the car and calculate the property tax amount. Although all counties assess property taxes at 100 percent of the appraised value of the car, the property tax rates differ among the counties. The tax rates for 2012 to 2013 range from .2790 percent in Jackson county to 1.0300 percent in Scotland county. Counties also use different schedules for reassessing the value, called revaluation schedules, of cars.

Tax Payment

The counties send car owners a tax bill three months after the date for annual renewal of the car’s registration. Owners have until the first day of the next month to pay the taxes. You might owe a prorated tax amount if you did not own the car for the entire year or if you registered the car in another state. If taxes are not paid by the block date on the tax bill, the DMV will not send the registration renewal notice to the car owner.

Late Payment and County Tax Block

County tax offices charge interest on unpaid tax bills, 5 percent as of 2012, beginning in the month after the bill is due and continue to add interest monthly until the bill is paid. If your tax payment is four months late, the county will place a block on your registration renewal. The block prevents the DMV from renewing your registration until you present a receipt showing that the taxes have been paid. The county that placed the block must remove it.


About the Author

Gail Sessoms, a grant writer and nonprofit consultant, writes about nonprofit, small business and personal finance issues. She volunteers as a court-appointed child advocate, has a background in social services and writes about issues important to families. Sessoms holds a Bachelor of Arts degree in liberal studies.

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