Free Michigan Gift Bill of Sale
Transferring a vehicle as a gift to an immediate family member in Michigan eliminates the standard 6% use tax — a saving that can easily top $1,000 on a typical used car. The exemption is claimed at a Secretary of State branch when the signed title is transferred; ask the SOS what proof of the relationship it needs. The title must be transferred within 15 days of the gift.
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Gifting a vehicle to a family member is a zero-dollar transfer, but the DMV still needs a bill of sale to process the title change. Our guide explains how the bill of sale and title work together and what recipients must show to claim the family-gift tax exemption. Read: Bill of Sale vs Title: What's the Difference? →
Michigan Gift Bill of Sale — What You Need to Know
Primary Form
Standard bill of sale
Agency
Michigan SOS
Michigan Department of State, Branch Offices
Primary ID Field
VIN
Sales Tax
0%
Title Required
Yes
Inspection
Not required
Inspection Requirements
No statewide safety or emissions inspection required for private gift transfers
Michigan Gift Sale — Step-by-Step Checklist
- Obtain the signed Michigan title from the donor — confirm no active lien or obtain a lien release
- Write $0 as the sale price on the bill of sale and identify the relationship between donor and recipient
- Ask the Secretary of State what proof of the family relationship the use-tax exemption requires
- Gather government-issued IDs for both parties
- Visit a Secretary of State branch office within 15 days of the gift date
- Pay the title transfer fee and applicable registration fees at the branch
- Ensure the recipient has valid Michigan auto insurance before driving
Common Pitfalls
- Not documenting a qualifying family relationship at the SOS branch — without the exemption, the 6% tax applies to the price or fair market value, whichever is greater
- The 15-day transfer deadline is firm — late transfers incur a penalty fee on top of regular title fees
- Assuming every relative qualifies — only the relationships on the Secretary of State's exemption list do, so check it before the transfer
- An out-of-state title may require additional verification steps before Michigan will issue a new title
Michigan Gift Bill of Sale — FAQs
How do I claim the family use-tax exemption?
At a Michigan Secretary of State branch when the title is transferred. Ask the SOS (michigan.gov/sos) what proof of the relationship it needs before your visit.
Can the donor mail the title rather than appearing in person?
The recipient can go to the SOS branch alone if the donor has already signed the title. Complete the title assignment fully before the visit.
Does Michigan require a vehicle inspection for gifted vehicles?
No statewide safety or emissions inspection is required for private gift transfers in Michigan. Fleet and dealer inspections are separate programs that do not apply.
What is the title transfer fee?
Michigan charges a standard title fee (currently $15) plus applicable registration fees. These are owed regardless of the gift status; only the use tax is waived.
My parent's title is handwritten and hard to read — is it still valid?
Yes, provided all required fields (names, VIN, odometer reading, and signatures) are legible. The SOS may request a replacement title if key information is unreadable.