LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 3, 2025 TO: Honorable Joan Huffman, Chair, Senate Committee on Finance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2064 by Perry (relating to an exemption from certain taxes imposed on the transfer of a motor vehicle to a person from a decedent or the decedents estate.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for SB2064, Committee Report 1st House, Substituted: a negative impact of ($504,000) through the biennium ending August 31, 2027. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2026($246,000)2027($258,000)2028($271,000)2029($285,000)2030($299,000)All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund12026($246,000)2027($258,000)2028($271,000)2029($285,000)2030($299,000) Fiscal AnalysisThe bill would exempt recipients of motor vehicles acquired from a Rights of Survivorship agreement or from a decedent's estate from the currently imposed $10 gift tax.The bill would take effect September 1, 2025.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 3, 2025
TO: Honorable Joan Huffman, Chair, Senate Committee on Finance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2064 by Perry (relating to an exemption from certain taxes imposed on the transfer of a motor vehicle to a person from a decedent or the decedents estate.), Committee Report 1st House, Substituted
TO: Honorable Joan Huffman, Chair, Senate Committee on Finance
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: SB2064 by Perry (relating to an exemption from certain taxes imposed on the transfer of a motor vehicle to a person from a decedent or the decedents estate.), Committee Report 1st House, Substituted
Honorable Joan Huffman, Chair, Senate Committee on Finance
Honorable Joan Huffman, Chair, Senate Committee on Finance
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
SB2064 by Perry (relating to an exemption from certain taxes imposed on the transfer of a motor vehicle to a person from a decedent or the decedents estate.), Committee Report 1st House, Substituted
SB2064 by Perry (relating to an exemption from certain taxes imposed on the transfer of a motor vehicle to a person from a decedent or the decedents estate.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for SB2064, Committee Report 1st House, Substituted: a negative impact of ($504,000) through the biennium ending August 31, 2027.
Estimated Two-year Net Impact to General Revenue Related Funds for SB2064, Committee Report 1st House, Substituted: a negative impact of ($504,000) through the biennium ending August 31, 2027.
General Revenue-Related Funds, Five- Year Impact:
2026 ($246,000)
2027 ($258,000)
2028 ($271,000)
2029 ($285,000)
2030 ($299,000)
All Funds, Five-Year Impact:
2026 ($246,000)
2027 ($258,000)
2028 ($271,000)
2029 ($285,000)
2030 ($299,000)
Fiscal Analysis
The bill would exempt recipients of motor vehicles acquired from a Rights of Survivorship agreement or from a decedent's estate from the currently imposed $10 gift tax.The bill would take effect September 1, 2025.
The bill would take effect September 1, 2025.
Methodology
Under current law, the $10 gift tax imposed on a gift of a motor vehicle is paid by the vehicle's recipient to the county tax assessor-collector at the time the recipient applies to title and register the motor vehicle. The gift tax collected is transferred to the Comptroller for deposit in General Revenue Fund.The bill would exempt recipients of motor vehicles acquired from a Rights of Survivorship agreement or from a decedent's estate from the currently imposed $10 gift tax.Based on information from the Department of Motor Vehicles (DMV), DMV's registration and title system has indicators that break down motor vehicle gift transactions by type however, such indicators don't correlate to the delineations in Section 152.025(a), Tax Code.DMV estimates, at most, 207,000 motor vehicle gift transactions occurred in fiscal 2024. DMV assumes the total number of all motor vehicle gift transactions is close to this estimated upper limit; therefore, about $2,070,000 in gift tax revenue was collected in fiscal 2024. DMV estimates, at least 22,000 motor vehicle gift transactions occurred in the fiscal 2024. DMV assumes the number of transactions in which a motor vehicle transferred as a gift from a decedent's estate in fiscal 2024 is close to this estimated lower limit.This analysis assumes that the number of transactions in which a motor vehicle is transferred as a gift from a decedent's estate will grow by about 5 percent year-over-year in fiscal 2025-30. The table above includes estimated revenue lost to General Revenue if such transactions are exempted from the $10 motor vehicle gift tax.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: b > td > 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: b > td > JMc, KK, SD
JMc, KK, SD