Motor Vehicle Excise Tax
What is motor vehicle excise?
Chapter 60A of Mass. General Laws imposes an excise on the privilege of registering a motor vehicle or a trailer in the Commonwealth of Massachusetts. The excise is levied annually in lieu of a tangible personal property tax. Non-registered vehicles, however, remain subject to taxation as personal property.
The excise is levied by the city or town where the vehicle is principally garaged and the revenues become part of the local community treasury.
The Registry of Motor Vehicles prepares data for excise bills according to the information on the motor vehicle registration and sends it to city or town assessors. Cities and towns then prepare bills based on excise data sent by the Registry in conformity with Department of Revenue requirements.
How is the excise determined?
The amount of the excise is based on the value of the motor vehicle that is based upon the manufacturer's list price.
Various percentages of the manufacturer's list price are applied. The formula is as follows:
- In the year preceding the designated year of manufacture (brand new car released before model year) - 50%
- In the designated year of manufacture- 90%
- In the second year - 60%
- In the third year - 40%
- In the fourth year - 25%
- In the fifth and succeeding years -10%
Calculating the excise:
Once the value of the vehicle is determined, an excise at the rate of $25.00 per thousand is assessed. Excises are assessed annually, on a calendar year basis, by the assessors of the city or town in which the vehicle is garaged.
If the motor vehicle is registered after January 31, it is taxed for the period extending from the first day of the month in which it is registered to the end of the calendar year. For example, if a vehicle is registered on April 30, it will be taxable as of April 1, for the nine months of the year (April through December) and the excise due therefore; will be 9/12 of the full excise. In no event shall the excise be assessed for less that $5.00 nor shall an abatement or refund under Section 1 of Chapter 60A reduce an excise to less that $5.00.
Who collects the motor vehicle excise?
Local tax collectors are responsible for collecting the motor vehicle and trailer excise. Generally, tax collectors and deputy tax collectors do not accept partial payment of an Excise bill. Taxpayers should be prepared to pay the full amount due. There are no special considerations for financial hardship.
When is payment due?
Payment of the motor vehicle excise is due within 30 days from the date the excise bill is issued (not mailed, as is popularly believed).
NOTE: A person who does not receive a bill is still liable for the excise plus any interest charges accrued. Therefore, it is important to keep the Registry and the US post office informed of a current name and address so that excise bills can be delivered promptly. All owners of motor vehicles must pay an excise tax; therefore, it is the responsibility of the owner to contact the collector's office if you have not received a bill.
What if I've moved out of Massachusetts?
If the owner of a vehicle moves out of Massachusetts and registers his/her vehicle in another state. File an application with the Assessing office for abatement together with the following:
- Registration Form for the new State or County AND Plate Return Receipt.
Please note: the Registry strongly encourages a person who has moved to another state to cancel the registration in Massachusetts in order to avoid problems with an excise tax abatement application or future registration in the new state.
What happens if my payment is late?
If an excise is not paid within 30 days from the issue date, the local tax collector sends a demand. The charge for the demand is $5. Interest accrues on the overdue bill from the day after the due date until the date of payment at an annual rate of 12 percent.
If the demand is not answered within 14 days, the collector may issue a warrant to the deputy tax collector or an appointed agent. The taxpayer is then additionally liable for a warrant fee of $5.
The second and third warrants fees vary depending on the deputy.
If this notice is not answered than a final warrant, a service warrant will be delivered or exhibited to the taxpayer at his/her residence or place of business. All bills should clearly state the interest and penalty charges.
Can I get motor vehicle excise abatement?
If an owner of a motor vehicle thinks that he/she is entitled to an adjustment of his/her excise bill, it is strongly recommended that he/she:
Pay the bill in full, and then contact the Assessing Office for an application for abatement. You can print out a Motor Vehicle Abatement Application Form at this web site.Go to Forms on the menu. Follow the directions on the form and send it to the Assessing Office.
NOTE: On unpaid excise tax bills, an owner risks incurring late fees and penalties if an abatement is not granted.
The Assessing office must receive applications for abatement by December 31 of the year following the year of the tax. If the bill is mailed after December 1 of the year following the tax year, application must be made on or before the 30th day from the date of issue or the date of mailing, whichever is later. Abatements can be handled through the mail; however, the bill should be paid as assessed and a refund will follow if the abatement is granted.
Under what circumstances might motor vehicle excise abatement be warranted?
Abatements can be filed if:
- The owner believes the assessment is incorrect, or
- If the vehicle was traded, or
- If the vehicle was stolen, or
- If the vehicle was sold during the year in which it is being taxed and the registration was properly cancelled, or
- If the owner moved from the Town of Mashpee to another city or town, or before January 1
- If the owner moved to another state and registered the vehicle and cancelled the registration in Massachusetts, or
- If the registration is cancelled, it is most important to return the plate(s) to the Registry of Motor Vehicles and to obtain a return plate receipt.
The Assessing office must account to the Registry of Motor Vehicles for two things in order to get an Abatement:
- The Vehicle (where did it go - it must be out of your possession)
- The Plates: (2 options)
a. Transfer to another vehicle
b. Turned into the registry of motor vehicles-(plate return receipt)
When an abatement is granted, excise bills are pro-rated by the month, thus the owner is responsible for the excise accrued through the month in which the car was last registered to him/her.
How does non-payment of motor vehicle excise affect license and registration?
If the service warrant demanding final payment is ignored, the collector may then notify the Registrar of Motor Vehicles of such non-payment, including all accrued interest and penalty fees. The Registrar may then mark the individual's registration preventing the renewal of the motor vehicle registration and the owner's driver's license until such time as the Registrar is notified that full and final payment has been made to the city or town. This payment shall include a $20 release fee as final settlement of the delinquent excise. Once the bill had been paid, the municipality will give the motorist a receipt so he or she can return to the Registry to register his/her vehicle.
Although the local tax collectors do notify the Registrar that the matter is resolved, it is strongly advised to retain the certified receipt of payment for presentation to the Registry of Motor Vehicles. Cities and towns relay computerized notification that excise bills have been paid only periodically to the Registry.
Under the excise tax law, tax collectors have six years from the issue date of a bill to notify the Registry of non-payment by a driver (M.G.L. c.60A, s2A), unless the tax record shows a history of non-payment. However, under the Registry's own policy, this notification time has been reduced to just two years. If the record does show a history of delinquency, the tax collectors can electronically mark the driver's record and institute proceedings to collect for as many years back (beyond six years, in other words) as necessary and notify the Registry. The Registry, in turn, reviews each notification beyond two years individually. If a taxpayer has had a good history of payment and suddenly receives a bill dating back more than six years, the assessors will assign a tax collector to collect the bill; the tax collector, in turn, will attempt to collect and assess late fees and penalties, as is required by law, if applicable. However, the collector can no longer mark the driver's record for non-payment since the Registry only allows two years for notification from the issue date of the bill. Thus, the taxpayer's ability to renew the license, in this instance, is not hampered; but the bill must still be resolved with the local tax collector.
What if I've moved out of Mashpee?
If a motor vehicle owner moves within Massachusetts and has not paid an excise tax for the current year, he/she should:
File an application with the Mashpee Assessor's office for abatement together with the following:
Provide the Assessing office with a copy of the following documentation:
- Proof of garaging as of January 1 of the billing year and
- A copy of the Insurance Policy (cover selection page) as of January 1 of the tax year
- Pay the motor vehicle excise to the city or town in which he/she resided on January 1
(If the owner moved before the first of the year, he/she must pay the tax to the new community to which the owner moved. If the owner did not notify the Registry, the local assessor, and the post office that he/she moved before the first of the year, it may be necessary to file for an abatement with the former city or town which had sent the excise bill. Most cities or towns will dismiss the bill and reroute it to the new community once the owner furnishes proof that he/she had moved before the first of the year.)
What if I sold my car?
If an excise bill is received for a vehicle or trailer that has been sold, the seller must: Return the plate(s) to the Registry of Motor Vehicles, obtain a return plate receipt.
File an application with the Assessor's office for abatement together with the following:
- Return plate receipt and the bill of sale OR
- New Registration Form
You can print out a Motor Vehicle Abatement application at this web site. Go to Forms on the menu. The bill will be adjusted to reflect the portion of the year when the recipient of the bill owned the vehicle.
NOTE: It is important to remember that the bill for a vehicle you no longer own should not be ignored.
What if I traded my car?
If an excise bill is received for a vehicle, which was traded, and which was not owned in the calendar year stated on the bill, it is recommended to:
- Pay the bill, and file an application for abatement with the Assessor's office.
- Provide a copy of the New Registration Form OR
- Plate Return Receipt AND Purchase Agreement citing vehicle as Trade-in
You can print out a Motor Vehicle Abatement application from Forms on the menu. If an excise bill is received for a vehicle which was traded but which was owned for a portion of the calendar year stated on the bill, it is necessary to:
- Pay the bill, and provide a copy of the registration for the new vehicle that indicates the date of transfer together with an application for abatement to the Assessor's office.
The Assessor's can then adjust the bill to reflect the ownership for only part of the year, and grant the proper abatement. The bill is prorated back to the last day of the month in which the vehicle was owned and the excise bill on the new vehicle will be prorated as of the date the new vehicle was registered.
What if my car is stolen?
If the vehicle is stolen and not recovered within 30 days, the owner will be entitled to an abatement if he/she: reports the theft of the vehicle to the local police within 48 hours of discovery of the theft.
After 30 days, the owner must surrenders the certificate of registration and obtain a certificate from the Registry of Motor Vehicles indicating that he/she has done so.
- Notify the Assessor's Office
- Provide Assessor's office with a copy of the following documentation:
- Insurance Company Settlement Letter AND C-19 form (Affidavit of Lost or Stolen plate) from the Registry of Motor Vehicles OR
- New Registration if plate transferred
This certificate and the local police report of the theft should be presented to the Assessor's office with an application for abatement. You can print out a Motor Vehicle Abatement application from this site. Assessor's office will adjust the bill and grant abatement for the remaining portion of the year. If the motor vehicle or trailer is subsequently recovered and reregistered, another excise bill will be issued for the remainder of the year.
Falsely reporting the theft of a motor vehicle or trailer will result in severe penalties and a person may be charged up to three times the excise due on the vehicle for an entire year.