Maryland Used Car Sales Tax 2026: 6.5% Excise Tax, $640 Rule, Gifts

Maryland doesn't charge regular sales tax on a used car. You pay a 6.5% vehicle excise tax (often called the titling tax) when the car is titled, up from 6% for purchases contracted on or after July 1, 2025. From a dealer, it's figured on the price after your trade-in. In a private sale, the MVA can tax you on book value if your price looks too low, and cars seven model years or older are taxed on at least $640. Rules below are as of Oct 19, 2026.

I checked the statute on the General Assembly's site, Transportation Article 13-809 and 13-810, and the MVA's excise tax page on Oct 19, 2026. The MVA site blocks automated requests, so I've cited it as text rather than a link. The rate change came from the Budget Reconciliation and Financing Act of 2025 (HB 352), so anything written before mid-2025 will still say 6%.

The rate and who sets it

Section 13-809 sets the tax at 6.5% of fair market value, or 3.5% for rental vehicles. The same section bars counties and cities from adding their own tax on a vehicle title, so the rate is the same in Baltimore as in Ocean City. MVA's business bulletin on the change says the contract or acquisition date decides the rate. A deal signed in June 2025 was taxed at 6%, and one signed in July 2025 or later pays 6.5%. Maryland's general sales tax is still 6%, according to the Tax Foundation's 2026 table, which is one reason people mix up the two numbers.

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Field guides, red flags, and the occasional discount.

Buying from a dealer

For a dealer sale, fair market value means the total purchase price the dealer certifies. The statute defines that as the agreed price including any dealer processing charge, minus a trade-in allowance. Say you buy a $15,000 car, the dealer adds a $500 processing charge and you trade in a car worth $4,000. Tax is 6.5% of $11,500, or $747.50. Without the trade it would be $1,007.50. The dealer collects it with the title paperwork, so the number should show up on your buyer's order. Check it there before you sign.

Private sales and the book value rule

This is where Maryland gets strict. For a private-party car newer than seven model years, MVA accepts your price only if it's less than $500 below the retail value in the used car guide it uses. The MVA page says that's the NADA clean retail value, adjusted for mileage. If your price is $500 or more under that, you need a notarized bill of sale on MVA's own form, signed by both of you, with a statement explaining why the car sold for that price. If MVA isn't convinced, you pay tax on the book value.

So a history report does double duty here. The book assumes a clean car, and it won't know about the accident, the flood brand from another state or the 60,000 miles that went missing. If that history is the reason the price is low, bring the report along with photos and repair estimates, since the statute lets MVA consider things like a written description of the car's condition, canceled checks, money order receipts and loan documents. A seller who wants you to write a fake low price "to save on tax" is asking you to sign a false notarized statement, and failing to pay the tax is a misdemeanor with a fine of up to $1,000.

Older cars and the $640 floor

For a private sale of a car seven model years old or older, the taxable value is the greater of the price or $640. That makes the minimum $41.60. Pay $3,000 for a 2015 sedan and the tax is $195. Pay $400 for a beater and you still owe the $41.60. If the car carries a salvage or rebuilt brand, read our Maryland salvage and rebuilt title rules first, because inspection and titling get more involved.

Gifts, family transfers and new residents

Section 13-810 exempts a transfer to a spouse, son, daughter, grandchild, parent, sister, brother, grandparent, or a father-, mother-, son- or daughter-in-law, as long as no money or other value changes hands. A niece or nephew qualifies only if the person giving the car is 65 or older. Transfers to an heir, in a divorce, and to a lessee buying out a long-term lease are also exempt. Active service members are exempt for a car already titled in their name, per MVA. New residents within 60 days of moving pay only the difference if their old state's rate was lower, or $100 if it was 6.5% or higher, for cars six model years or newer.

The full title steps are in our Maryland private-sale title transfer guide, and our used car sales tax overview explains how other states handle trade-ins and private sales.

Check the car before the paperwork

Run the VIN through NMVTIS for title brands, then a full CARFAX history or AutoCheck. CarVins sells both as a licensed reseller and isn't affiliated with CARFAX, AutoCheck or Experian. As of mid October 2026, expect about $5.50 for a guest report, about $4.50 as a member and around $6.75 for both reports, compared with roughly $39.99 to $44.99 at retail. The checkout page shows the current price.