- Who handles it
- The county tax assessor collector for registration, plus the Texas Comptroller for the tax
- What gets filed
- Signed titles, a bill of sale for each vehicle and the buyer's title application
- Timing
- Handle titles at or right after closing, one vehicle at a time
Common snag: Treating trucks like any other equipment in the deal. Vehicles are taxed and titled separately.
Vehicles are not ordinary equipment
Machinery and tools change hands with a bill of sale. A truck, van or trailer needs a signed title and a title application filed in the buyer's name.
Each vehicle has to be handled one at a time, and the buyer typically does this at the county tax assessor collector's office.
Motor vehicle sales tax is separate
Texas collects motor vehicle sales tax when a vehicle is titled, at a rate of 6.25 percent, and it is not part of the occasional sale treatment that applies to other operating assets. The buyer usually pays it.
For a vehicle bought in a private sale, the tax is figured on the price or on a standard presumptive value, whichever the state rules require. Buyers should ask their CPA what applies.
The practical effect: a fleet of ten trucks can add a real cost to the buyer's closing budget. Sellers can help by being honest about the number of titled vehicles early.
Get your titles in order
- List every titled vehicle and trailer, with the VIN, and who is on the title
- Find any lien and plan the payoff, since a bank holds the title until it is paid
- Check that titles are in the company's name, not an owner's personal name
- Remove personal vehicles from the deal, or price them as a separate line
- Gather keys, registrations and service records
An owner who bought a truck personally and ran it through the company needs to decide whether it stays or goes. Settle that before the letter of intent.
Put it in the contract
The agreement should attach a vehicle schedule, say who pays the titling costs, and set out when the seller delivers signed titles. Many deals use escrow so the titles and the money trade at the same time.
Insurance matters too. The buyer needs its own coverage in place on the closing date, and your policies for those vehicles should end on the same day.
Where it fits in the price
Buyers value vehicles as part of the asset list. The more of the company's value sits in equipment, the more they will check titles and condition. See how cash free debt free deals treat loans against those assets.
If a trade license is involved, read the TDLR licensing guide too. To see what the whole company could bring, ask for a private price range.
This page is general information and not tax or legal advice. Confirm titling steps and tax with your CPA and the county tax office.