In Florida, selling a vehicle requires adhering to state-specific regulations to ensure a seamless and legal transaction. Failure to comply with these regulations can result in potential consequences, including fines, penalties, and even legal liability.
For instance, failure to transfer the title correctly can result in the seller being held liable for any incidents or operations involving the sold vehicle after the sale. Moreover, not obtaining the necessary documentation, such as a bill of sale, can lead to disputes and potential legal issues.
Thus, it is crucial to understand the legal requirements before and after the sale of a vehicle in Florida.
From obtaining a temporary tag for test driving to notifying the Florida Department of Highway Safety and Motor Vehicles (FLHSMV) of the sold car, sellers must comply with the state-specific regulations to protect themselves from potential consequences and ensure a successful sale.
Legal Requirements Before Selling a Vehicle in Florida
Florida experiences a substantial volume of vehicle sales annually. As a seller, it is crucial to be well-informed about the necessary steps and legal requirements before selling a vehicle.
These steps and legal requirements include the following:
Temporary Tag for Test Driving
When a seller purchases a new vehicle and opts to transfer the license plate from the car they intend to sell, it becomes necessary to obtain a temporary tag.
This temporary tag allows potential buyers to test-drive the vehicle before making a purchasing decision. When obtaining this tag, sellers must provide proof of Florida insurance.
Duplicating a Title
To ensure the legality of a vehicle sale in Florida, the seller must transfer the title to the buyer. However, if the title is a paper document and has been misplaced or lost, the seller must obtain a duplicate title before proceeding with the sale.
To obtain a duplicate title, the seller must complete HSMV Form 82101 and submit it, along with the duplicate title fee, to a local motor vehicle service center. In specific locations, expedited service options are available, although an additional $10 fee may be applicable.
Having a Paper Copy of the Title
If the seller possesses an electronically maintained title, they should request a paper copy be printed for a seamless transfer of title ownership to the buyer.
In addition to visiting the local motor vehicle service center, owners who have e-titles can ask for a paper title through the MyDMV Portal by paying a $2.50 service fee.
Advertising the Vehicle
When advertising a vehicle for sale in Florida, sellers must be aware of specific regulations. The state prohibits parking any vehicle on public right-of-ways or private property without obtaining permission from the property owner. This ensures that sellers do not engage in unauthorized "curbstoning" activities.
Furthermore, note that if a seller intends to sell three or more vehicles within a year, they will be classified as a motor vehicle dealer in Florida. As a result, they must obtain the appropriate license issued by the state.
VIN Inspection
If a vehicle has not been previously titled in Florida, sellers must complete an additional step before selling it.
They must undergo a Vehicle Identification Number (VIN) and Odometer Verification. This process requires the owner's verification along with the presence of a qualified individual who can verify the information.
The verification can be conducted by a compliance examiner/officer from the FLHSMV, a licensed motor vehicle dealer in Florida, a Florida notary public, or a law enforcement officer.
Vehicle History Reports
When selling a car in Florida, sellers should familiarize themselves with vehicle history reports. Prospective buyers frequently request these reports of used cars as they provide valuable insights into the vehicle's background.
By obtaining a vehicle history report, sellers can provide potential buyers with records of accidents, thefts, and instances of odometer fraud, among other critical information.
Selling a Vehicle with a Lien in Florida
Certain procedures must be followed when selling a vehicle in Florida with a lien to ensure a legal and smooth transaction. A lien, a legal claim on the car, is placed by the lienholder to protect their financial interest until the buyer fulfills their loan obligations.
In Florida, private sales of vehicles with existing liens are not allowed. Before the car can be sold, the lien must be satisfied. This means the buyer must pay off the loan in full, and the lienholder must report to the FLHSMV that the lien has been released.
If a consumer wishes to trade in a vehicle with a lien at a dealership, the dealer must settle the lien within ten days before selling it to another customer. In this case, there is no need to obtain a paper title before trading the vehicle with a licensed Florida dealer.
How To Remove a Lien From a Car Title in Florida?
Removing a lien from a car title in Florida is straightforward, thanks to the state's electronic title system. Once the car payments are complete, the lienholder will electronically notify the FLDHSMV that the lien has been released.
Motor Vehicle Sales Tax in Florida
By Florida law, sales tax must be collected on the sales price of a motor vehicle or vessel. When a motor vehicle or vessel is sold straight, without a trade-in, a 6% tax is levied on the total sales price.
This means that if a buyer purchases a motor vehicle or vessel without any trade-in, they must pay a 6% sales tax on the entire sales price. The sales tax is calculated based on the total amount agreed upon for the purchase.
In the case of sales involving trade-ins at a dealership in Florida, sales tax must be collected on the difference between the trade-in allowance and the sale price of the motor vehicle being purchased.
For example, if John trades in his car for $10,000 and purchases another vehicle for $20,000, he would only pay taxes on the $10,000 difference. This tax deduction provides a valuable benefit to sellers when selling their cars to a dealership.
Who Pays Sales Tax When Selling a Car Privately in Florida?
When selling a vehicle privately in Florida, buyers should know that they are responsible for calculating and paying the appropriate sales tax. The sales tax is typically based on the vehicle's purchase price and must be paid at the time of registration.
By fulfilling their obligations and paying the necessary sales tax, buyers can complete the registration process successfully and avoid any potential penalties or issues in the future.
Sales Tax for Vehicles Sold in Florida to Residents of Another State
When someone from another state buys a car in Florida, they might not have to pay the total sales and use tax. Instead, Florida will only collect tax based on the rate from the buyer's home state. If their home state's tax rate is higher than 6%, they'll still only pay a maximum of 6% tax in Florida. This tax is a Florida tax and must be paid to the Florida Department of Revenue.
To qualify for this partial exemption, the nonresident purchaser must complete Form DR-123 at the time of sale. This form declares the purchaser's intention to license the vehicle in their home state within 45 days of the purchase date.
After filling out Form DR-123, it's given to the selling dealer. If the car was bought from an individual, the form goes to the tax collector or a private tag agent when getting a temporary tag for the vehicle.
Legal Requirements After Selling a Vehicle in Florida
In Florida, sellers and buyers must fulfill specific legal requirements after a vehicle sale. These requirements include:
Odometer Disclosure Requirements
In Florida, all vehicle certificates issued after February 1983 have a designated space for recording the current mileage. By marking down the mileage in this space, sellers fulfill the odometer disclosure requirements for the purchase. This certifies that both the seller and the buyer clearly agree about the vehicle's mileage.
The buyer needs the recorded mileage reading to complete their title application with the FLHSMV.
Transferring the Title to the New Owner
To ensure a smooth and proper vehicle title transfer, the FLHSMV encourages sellers to complete the sales transaction at a motor vehicle service center. This protects both the seller and the buyer, as it ensures that the title is transferred out of the seller's name and provides the buyer with the necessary ownership documents.
The seller is responsible for completing the Transfer of Title by Seller section on the front of the title certificate. This includes filling in the buyer's name and address, providing odometer information, stating the selling price, and indicating the date of the sale.
On the other hand, the buyer must complete an Application for a Certificate of Title. This form should be attached to the title and submitted to a motor vehicle service center to transfer the title into their name.
Do Both Parties Need To Be Present To Transfer a Title in Florida?
When transferring the title to the new owner in Florida, the buyer and seller must both be present and provide photo identification. To avoid any late transfer penalty fees, the transfer must be completed within 30 calendar days.
Removing the Plates
When a vehicle is sold, the seller is responsible for removing the license plates from the car. These plates remain the seller's property and do not transfer to the new owner.
The seller can transfer the plates to a new or replacement vehicle or surrender them to the appropriate motor vehicle service center.
However, surrendering the plates is mandatory in certain situations, such as when the seller is relocating to another state or canceling the insurance associated with those plates.
Failure to properly handle the license plates after a sale could result in legal consequences.
How To Notify the Florida HSMV of the Sold Car?
Since July 2009, sellers have been required to complete and file a Notice of Sale (HSMV Form 82050), also known as a bill of sale, to notify the FLHSMV of the sale of a vehicle.
Submitting this form to a motor vehicle service center will remove the seller's registration from the vehicle, protecting them from potential civil liability for any incidents or operations involving the sold vehicle after the sale.
Once the form is filed, the buyer must apply for the title and registration before legally operating the vehicle. The buyer must follow through with this step. If the buyer fails to do so and the seller does not file HSMV Form 82050, the seller may still be held liable for any actions or issues related to the vehicle, even if they no longer own it.
In addition to notifying the sale, HSMV Form 82050 acts as a legal receipt and documentation of the transaction.
Sellers are advised to keep copies of the bill of sale, certificate of title, or any other transaction documents. By maintaining these records, sellers can further protect themselves and have a clear sale record.
Does the Bill of Sale Need To Be Notarized in Florida?
FLHSMV recommends that the bill of sale be notarized for enhanced authenticity. While it is not explicitly required by law, notarizing the bill of sale provides additional assurance and validation to the transaction.
For additional information and assistance in completing all the required forms and documentation for selling a vehicle in Florida, contact the FLHSMV Customer Service Center representatives at 850-617-2000.
Alternatively, sellers can visit the nearest local motor vehicle service center for further guidance. Contact details for specific local motor vehicle service centers can be easily accessed on the FLHSMV website.