How to Transfer a Car Title to a Family Member in Wisconsin

Whether you’re gifting or selling your car to a family member, you’re still obligated to transfer the car’s title to them. This ensures a smooth transition of ownership, avoids potential legal complications, and simplifies the registration process for the new owner.

But how to transfer a car title in Wisconsin? Our guide will help you get a hang of the whole process so you know exactly what documentation you need to successfully transfer a car title in the state. 

Why Is It Important to Have a Clear Car Title for Loans?

Before we delve deeper into the nitty gritty of the title transfer process, let’s answer one important question—why is a clear car title correctly transferred to the new owner crucial for eligibility for title loans in Wisconsin?

• Proof of Ownership: The title loan relies on your vehicle as collateral. The title serves as irrefutable proof that you are the legal owner of the vehicle. Without a clear title in your name, the lender cannot confidently use your vehicle as security for the loan.   
• Determining Loan Amount: The value of your vehicle is a key factor in determining the loan amount you can qualify for. A clear title provides accurate information about the vehicle, such as its make, model, year, and mileage, which helps the lender assess its market value and determine an appropriate loan amount.
• Lien-Free Title: Also, a clear title indicates that there are no other financial obligations or liens against the vehicle. This is essential because the lender needs to ensure that your vehicle is not already encumbered by another loan or debt.

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How to Transfer a Car Title in Wisconsin

What do I need to transfer a car title in Wisconsin? The process of transferring a car title in this state is generally the same whether you are gifting the car or selling it. You’ll need to fill out the same forms, provide the same documents, and pay the required fees.

1. Gather Necessary Documents

• Gather the required documents to apply for a new title (we will go into more detail later in this guide).

2. Complete the Application

• Obtain MV1 Form: Download the “MV1 Title/License Plate Application” from the Wisconsin DMV website (wisconsindot.gov) or get it at a local DMV office.   
• Fill Out the Form: Accurately enter information such as:
  • Vehicle details (make, model, year, VIN)
  • Seller and buyer information
  • Purchase price

3. Submit the Application and Pay the Fees

• Visit a DMV Office: Submit the completed MV1 form, signed title, and other required documents to your local DMV office.   
• Pay Fees: Pay the title transfer fee, sales tax, and registration fees at the DMV.

4. Receive New Title

The DMV will issue a new title in the buyer’s name.

Required Documentation

What documents do you need to transfer a car title in Wisconsin? 

• Original Title: Signed by the seller(s).   
• Bill of Sale: A written agreement between buyer and seller, including vehicle details and purchase price.   
• Identification: Valid Wisconsin driver’s license or state ID for both buyer and seller.   
• Odometer Disclosure Statement: Required for vehicles under 10 years old.

Fees and Tax Information

Title Transfer Fee

In Wisconsin, there is a $15 fee associated with transferring a vehicle title. This fee is typically paid by the buyer at the time of the transfer.

Sales Tax

When transferring a vehicle title in Wisconsin, you’ll likely need to pay sales tax. The sales tax rate can vary depending on the county and city where the vehicle is registered. 

Generally, it’s around 5% of the vehicle’s sale price. Counties can also add local sales and use tax of up to 0.5% to the purchase price.

Family Transfers and Sales Tax Exemptions

If you gift a car to a family member, you are not required to pay sales tax on that vehicle transfer. Family transfer exemptions apply specifically to vehicle transfers that involve a current Wisconsin title.

The exemption covers transfers between specific family members, including:

• Spouses
• Parents and children (including stepchildren and in-laws)
• Sole proprietors transferring ownership to a family member.

Documentation Required

To claim the exemption, the purchaser must indicate the reason for the tax exemption when completing the vehicle title transfer application. For instance, if a vehicle is transferred from a parent to a child, the purchaser should select “parent” as the reason for exemption.

Example Scenarios

Transferring a car title to a family member in Wisconsin involves specific steps that can vary based on the nature of the transfer. Let’s analyze some common examples of transfers among family members. 

A parent gifting their old car to a college-bound child

One common occurrence is when a parent wants to transfer the car’s title to their child who’s going away to college. 

To make the transfer official, they’ll need to complete a Bill of Sale, sign the title, and submit the necessary paperwork to the Wisconsin DMV.

Remember that it is required to include a reason for the sale tax exemption if you want to benefit from it. In this case, you should input “parent” for the additional information.

A sibling transferring ownership as part of a family agreement

Two siblings, perhaps as part of a family estate settlement, decide to transfer ownership of a vehicle between themselves. 

This process follows similar steps to a regular sale, with both siblings needing to provide identification and complete the necessary forms. A Bill of Sale will be crucial to document the transfer and ensure a smooth transition of ownership.

A spouse transferring a title after refinancing the vehicle

To complete the transfer, the original vehicle title must be signed by both spouses if both names are on it. Then, you’ll need to complete Form MV1. If refinancing has created a new lienholder, ensure that a lien release is obtained from the prior lender if applicable.

Both spouses should visit the DMV together to submit all required documents, including proof of insurance and identification.

Common Mistakes and How to Avoid Them

Incorrectly Completing the Title Transfer Section

Mistakes like typos in names, incorrect VIN numbers, or inaccurate odometer readings can cause significant delays. The DMV may reject the application, requiring you to correct the errors and resubmit, wasting time and potentially incurring additional fees.

It’s easy to avoid this. Double-check every detail on the title transfer application (MV1 form) for accuracy. Use the official Wisconsin DMV website as a guide to ensure all fields are filled in correctly.

Failing to Submit the Statement of Transfer Form (for Gift Transactions)

While not always explicitly required, a Statement of Transfer can be beneficial when gifting a vehicle. It provides clear documentation of the gift and can help avoid potential disputes or misunderstandings later on.

Omitting Required Documentation

Missing even a single crucial document can halt the entire transfer process. Common omissions include:

• Original Title: Signed by the seller(s) and free of liens.
• Bill of Sale: A legally binding agreement between buyer and seller.
• Proof of Identification: Valid driver’s licenses or state IDs for both parties.
• Odometer Disclosure Statement: For vehicles under 10 years old.
• Lien Releases: If the vehicle has any outstanding loans.

Create a checklist of all required documents before visiting the DMV. Gather all necessary paperwork beforehand to avoid delays.

Missing Deadlines for Submitting Paperwork to WisDOT

Generally, you have 30 days from the date of sale to transfer the title. We recommend scheduling your visit in advance to avoid last-minute rushes and potential delays. Also, you could set a reminder on your calendar to ensure timely submission.

Conclusion

Properly transferring a car title in Wisconsin is crucial to avoid legal and financial complications for both the buyer and seller. By accurately completing all necessary forms, submitting all required documentation, and adhering to deadlines, you can ensure a smooth and hassle-free transfer.

Remember to double-check all requirements with the Wisconsin Department of Transportation (WisDOT) or your local WisDOT office if you have any issues or questions.

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Are there sales tax exemptions for gifting a car to family members in Wisconsin?

FAQs

In Wisconsin, there are indeed sales tax exemptions for gifting a car to family members. This exemption applies to vehicles with a current Wisconsin title. Transfers involving out-of-state titles do not qualify for this exemption. 

Do I need a Statement of Transfer for family title transfers?

In Wisconsin, a Statement of Transfer is generally not required for family title transfers when gifting a vehicle.

Can I transfer a car title online in Wisconsin?

Yes, you can transfer a car title online in Wisconsin through the Wisconsin Department of Transportation’s eMV public portal.

What happens if the vehicle has an outstanding lien?

If a vehicle has an outstanding lien in Wisconsin, specific steps must be followed to transfer the title. Before transferring ownership, you must obtain a lien release from the lienholder. This is essential because the title cannot be transferred until the lien is cleared. 

How do I handle a title transfer if the original owner is deceased?

Transferring a car title when the original owner is deceased in Wisconsin involves specific steps and documentation. Here’s a detailed guide on how to handle this process:

1. Determine the Estate’s Executor:
   • Identify the executor or personal representative of the deceased person’s estate, as they are responsible for managing the assets, including vehicles.
2. Obtain a Death Certificate:
   • Acquire a certified copy of the death certificate, which is necessary to prove the owner’s death during the title transfer process.
3. Complete the Title Transfer Form:
   • Fill out the Title/License Plate Application (Form MV1) to initiate the title transfer.
4. Provide Proof of Inheritance:
   • Submit proof of inheritance, which may include:
     1. A will
     2. Trust documents
     3. Court orders designating you as the rightful heir.
5. Use Statement of Transfer Form:
   • Complete the Statement of Transfer of Vehicles to a Surviving Spouse, Domestic Partner, or Heir (Form MV2300). This form is required when transferring ownership to an heir or surviving family member.
6. Submit Required Documents:
   • Gather all necessary documents, including:
     1. The completed Form MV1
   • Submit these documents to the Wisconsin Department of Transportation (WisDOT) either by mail or at a DMV Customer Service Center.