Nevada maintains unique laws and regulations for vehicle sales, which are designed to protect both buyers and sellers. Residents planning to sell their vehicles must familiarize themselves with these specific requirements to ensure a lawful and secure transaction.
The Nevada Revised Statutes (NRS), specifically Chapter 482, outline the legal framework for motor vehicle sales in the state. This framework requires sellers to comply with several key obligations.
These include the proper transfer of the vehicle title, accurate disclosure of odometer information, removal of license plates from the sold vehicle, and notification to the Nevada Department of Motor Vehicles (NV DMV) online within five days after the sale.
Adherence to these regulations serves multiple purposes. It protects sellers from potential future liabilities, helps them sidestep legal complications, and encourages a fair and transparent process for all parties involved in the vehicle sale.
Legal Requirements Before Selling a Vehicle in Nevada
Nevada sellers and buyers must do more than exchange a vehicle and payment. The process involves essential paperwork that safeguards both parties and fulfills NV DMV requirements before proceeding with the transaction.
Emission Testing
Nevada enforces annual emission tests for specific vehicles, particularly those in Clark and Washoe Counties' urban areas. This requirement covers all gasoline-powered vehicles, regardless of their size or weight, and diesel-powered vehicles with a manufacturer's gross vehicle weight rating of up to 14,000 pounds.
The Nevada Administrative Code (NAC) 445B.5855 mandates that used vehicle sellers provide buyers with proof of emission compliance. This documentation confirms that the vehicle meets the state's emission control standards.
These Nevada car dealers must ensure that any vehicle they sell for registration in Clark or Washoe Counties passes a valid emissions test. They must provide this proof to the buyer before completing the sale.
The state exempts new cars from emission testing until their third registration cycle. Consequently, sellers of new vehicles can leave this requirement out during the initial sale.
Preparing the Certificate of Title
Nevada law requires the preparation of a vehicle's title to its new owner before finalizing a vehicle sale transaction. This mandate maintains accurate state records of vehicle ownership, which are essential for taxation, regulation, and law enforcement purposes.
The ownership transfer process necessitates the certificate of title. If the original title is lost, stolen, damaged, or destroyed, obtaining a duplicate is needed. A duplicate is also often necessary when updating information, such as an address change.
For vehicles titled in other states, sellers must secure a copy from the respective state.
For vehicles previously titled in Nevada without liens, the seller has two options to obtain a duplicate title. They can either mail a completed Application for Duplicate Nevada Certificate of Title (VP 012) or schedule an appointment and apply in person at any NV DMV office. The NV DMV typically mails the duplicate title within approximately six weeks.
Getting a Vehicle History Report
A vehicle history report provides transparency about the car's past, which can build trust with potential buyers.
Getting this report before selling a car in Nevada shows that the seller is open and honest about the car's history. This report can also help justify the vehicle's negotiable price. A well-maintained car with a clean history may command a higher value. Additionally, it identifies potential issues or necessary repairs, preventing future surprises.
In some cases, sellers may be held liable for any undisclosed problems. Providing a vehicle history report can offer legal protection for sellers by showing they disclosed all known issues.
Sellers can obtain a vehicle history report through several methods:
Online: The National Motor Vehicle Title Information System (NMVTIS) offers an online Research Vehicle History section, where individuals can access crucial vehicle history information from various approved data providers.
In Person: Visit any local NV DMV office and submit a completed Application for Individual Record Information (IR 002). If an individual wishes to authorize the release of their vehicle history report to a third party, they must complete and submit the Letter of Authorization to Release Information (IR 015).
Mail: By mailing a completed IR 002 or IR 015 Form to the address below:
Department of Motor Vehicles
Records Section
555 Wright Way, Carson City, NV 89711-0250
For inquiries about fees and additional information, individuals can reach out to the Records Section by calling (775) 684-4590.
Implementing Effective Strategies
Sellers in Nevada can effectively attract suitable buyers by implementing the following smart promotion and advertising strategies:
- Create compelling vehicle descriptions that emphasize key features and conditions to capture potential purchasers' interest.
- Offer third-party inspections to allow buyers to gain an upfront understanding of the vehicle's condition.
- Prepare for price negotiations with potential buyers and be ready to address any issues that arise during the selling process.
However, before engaging in multiple sales, sellers must be aware that the state regulates the number of vehicles an individual can sell without a license. Specifically, sellers who intend to sell more than three vehicles must acquire a permit from the Nevada DMV to continue trading legally.
This regulation distinguishes between occasional private sellers and those who might be operating as unofficial dealerships.
Selling a Vehicle With a Lien in Nevada
In cases where the seller must sell a vehicle with a lien, they must first contact the lienholder.
Lenders or lienholders place liens on vehicles as legal claims when they provide car loans. These liens use the vehicle as collateral for the loan. To remove a lien, the vehicle owner must pay off the entire remaining loan balance.
The lien removal process differs based on whether the lienholder uses an electronic or paper title system. Electronic titles require the lienholder to release the lien digitally, while paper titles involve physical document transfers. Each method has specific steps to ensure proper lien release upon full loan repayment.
Electronic Lien Title (ELT)
Lienholders generally use the ELT system for loans or liens established on or after July 1, 2017.
In this case, the lienholder notifies the NV DMV directly about the lien satisfaction. The sellers need not take any further action but should make sure the lender has their correct address.
The NV DMV will then mail the new title to the party specified by the lienholder.
Paper Lien Title
Lienholders typically possess paper titles for vehicles with liens recorded before July 1, 2017.
When the borrower pays off the lien, the bank or lienholder must sign the "Lienholder To Be Recorded Section" on the vehicle title and hand it over to the seller. In these cases, lenders do not bear the responsibility of notifying the NV DMV about the loan payoff.
If sellers neglect to secure a new lien-free title and fail to inform the NV DMV about the lien release, the NV DMV's records will continue to reflect the lienholder. This oversight can lead to complications during the sale process.
Sellers must understand that with paper lien titles, they are responsible for updating the NV DMV records to reflect lien satisfaction.
Unavailable Lien Title
In cases where the lienholder lacks possession of the lien title, they can complete and notarize the Lien Release (VP 186) Form and mail it to the seller. The lienholder can also furnish a notarized VP 186 form and send it to the vehicle owner.
Upon receiving this form, the owner must then fill out a VP 012 Form. To finalize the process, the owner needs to submit both the notarized VP 186 and the completed VP 012 Forms to the NV DMV for processing.
Motor Vehicle Sales Tax in Nevada
In Nevada, parties involved in vehicle sale transactions must understand that a base state sales tax of 6.85% applies to vehicle purchases.
However, additional local taxes can cause the total rate to vary by county. The combined sales tax rate can reach a maximum of 8.375%, with the state average being approximately 7.957%.
Who Pays Tax When Selling a Car in Nevada?
When purchasing from Nevada dealers, buyers pay sales tax to the dealer based on the vehicle's actual purchase price. Dealers then forward these taxes to the state authorities.
Out-of-state dealers selling to Nevada residents have different approaches to tax collection. Some collect Nevada sales tax and submit it with title paperwork to the NV DMV Central Services Division. Others do not collect the tax. Instead, they inform buyers that they must pay it directly to the NV DMV during vehicle registration.
Nevada law exempts private party sales, family transfers, and gifts from sales tax. This exemption substantially lowers the cost of transferring vehicle ownership in these situations.
Who Pays Tax When Selling a Nevada Car to Residents of Another State?
Nevada dealers generally do not collect Nevada sales tax on sales to out-of-state residents if the vehicle will be registered out of state. However, the dealer may require proof that the buyer intends to register the car in another state.
Legal Requirements After Selling a Vehicle in Nevada
During and after the vehicle sale, the seller must fulfill the following legal requirements:
Disclose the Odometer Information
The NV DMV alerts sellers and automotive industry members about a new federal rule regarding odometer disclosure issued by the National Highway Traffic Safety Administration (NHTSA).
This regulation extends the mandatory period for declaring odometer readings during vehicle sales.
Starting January 1, 2021, the rule requires sellers to disclose odometer readings for vehicles from model year 2011 and newer for 20 years, which doubles the previous 10-year requirement. Once the vehicle sale transaction is settled, sellers must record the current mileage in the Odometer Reading Section of the title.
The new regulation changes the exemption timeline for vehicles. For example, a 2011 model vehicle, previously exempt from disclosure in 2021, now requires odometer disclosure until 2031. Similarly, 2012 models will become exempt in 2032, with subsequent model years following this pattern.
Complete a Nevada Bill of Sale
After finalizing a vehicle sale, sellers should complete the Nevada Bill of Sale (VP 104) for their records. This document releases the seller's interest in the vehicle and offers protection if the vehicle is later abandoned. It assigns responsibility for towing and impound fees to the last listed owner.
The bill of sale also voids the seller's liability if the new owner fails to comply with state laws or register the vehicle in their name.
The NV DMV recommends completing a bill of sale for all vehicle transactions, even when not legally required. However, vehicle sales transactions necessitate a transfer of ownership on the title, and a bill of sale alone does not constitute a legal sales transaction.
Even in transactions that are not legally mandated, a bill of sale serves several purposes. It records the sale or purchase for tax purposes, acts as a receipt for personal files, proves helpful when moving to states requiring such documentation, and offers protection against potential legal issues.
A typical bill of sale includes:
- Vehicle description and vehicle identification number (VIN)
- Names of the buyer and seller
- Final sale price of the vehicle
- Contact information for both parties
- Location of the transaction
Transfer the Title to the New Owner
When selling a vehicle, the seller bears the responsibility of correctly transferring the title to the new owner. To ensure a smooth transaction, both parties should visit a local NV DMV office together. This approach helps prevent potential complications and facilitates the proper completion of all required documents.
At the office, the seller and buyer must accurately fill out and sign their respective sections of the certificate of title. This document requires several key pieces of information:
- The seller's full name
- The buyer's full name and address
- The vehicle's current odometer reading
- The date of the sale
- The agreed-upon purchase price
- Signatures from both the seller and buyer
To enhance the security of the transaction, the seller should provide the buyer with a completed VP 104 form. For added authenticity and to create a valid proof of transaction, both parties may choose to have this document notarized.
Notify the Authorities of the Transaction
After completing a vehicle sale, the seller must promptly inform the NV DMV of the transaction. This notification allows the NV DMV to update its records to reflect the change in ownership.
To protect themselves from potential liabilities, sellers should use the Vehicle Resale Notification portal within five days of the sale. This step shields them from issues such as vehicle abandonment or accidents involving their former vehicle.
Failure to notify the NV DMV can have serious consequences for the seller. If they neglect this crucial step, they may remain liable for any problems or incidents involving the vehicle, even though they no longer own it. The NV DMV considers the last registered owner responsible until they receive official notification of the sale.
Remove the License Plate
Sellers must remove the license plates from their vehicle before completing the sale. These plates remain the seller's property, which they can either transfer to another car they own or surrender to the NV DMV.
How To Waive a License Plate in Nevada?
The NV DMV offers four methods for relinquishing license plates:
By Mail
Sellers can mail their plates, decals, and a signed cancellation request letter to the address below:
Department of Motor Vehicles
Central Services Division
555 Wright Way, Carson City, NV 89711-0700
For added security, they can use certified mail with a return signature requirement. The letter should include the seller's correct return address and daytime phone number.
Through Online Access
Sellers can cancel their registration through the MyDMV portal if they have sold their vehicle or plan to stop operating it. The system provides a receipt listing the registration fee credit.
However, sellers must still physically surrender the plates in person or by mail using the address mentioned above.
In-Person
Sellers can bring their plates to the County Assessor or any NV DMV office that offers vehicle registration services without an appointment.
They should hand the plates to a staff member at the information desk and avoid drop boxes unless marked explicitly for license plates. Sellers wishing to keep their plates as souvenirs can cancel the registration and bring only the rear plate for decal removal.
Plate Transfer to Another Person
Sellers can allow another person to use their existing license plates. However, they must cancel their registration online if the new owner is not using the plates immediately.
The seller should complete a License Plate Release form (SP 67), which the new owner submits when registering the vehicle.
Registration fee credits cannot be transferred to the new owner. "Home Means Nevada" plates must be used within 60 days of cancellation or expiration, while specialty plates have a 30-day limit if used on a new vehicle.