Personal Property Tax for Leased Tesla Vehicles
Certain states assess an annual personal property tax (PPT) that applies to motor vehicles. The property tax is collected by the local tax collector's office in the jurisdiction in which the vehicle is registered or garaged, depending on the state.
Overview
The local taxing authority applies a tax rate to the assessed value of the vehicle, resulting in the tax amount owed. Depending on the state, the vehicle may be assessed for the entire tax year or prorated based on the number of months the plate or title is active. The timing of the tax billing is also dictated by the state or entity, with most issuing a bill once or twice annually. As the vehicle owner, Tesla Lease Trust receives the bill from the taxing authority and pays the amount directly to the collector. The tax amount will then be billed to your account per your lease contract terms. Processing times may vary.
Exemptions
States may offer partial or total property tax exemptions based on Military Status, Personal Use Certification or other classifications. Refer to your local Assessor’s office for more information and documentation requirements.
See general PPT information for your state below.
Note: This information is provided for general information, and Tesla is not liable for any inaccuracies or omissions. Refer to your local taxing authority for authoritative information and any questions you may have.
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- Alaska does not impose a statewide motor vehicle personal property tax. Any taxation of motor vehicles occurs only at the local level, if a municipality or borough has chosen to tax business personal property, which may include leased motor vehicles.
- Alaska jurisdictions that tax motor vehicle include:
- North Slope Borough
- City and Borough of Juneau
- Valuation methods vary by jurisdiction and may include original cost less depreciation or locally adopted valuation schedules.
- Property tax bills, if applicable, are issued and collected by the local taxing authority.
- Exemptions commonly cited (e.g. a first-$100,000 exemption) apply only in specific municipalities and should not be assumed statewide.
- There is no automatic statewide tax exemption for service members, but some municipalities may have local provisions. Military customers should check with their local jurisdiction.
- Alaska requires new residents or those taking employment in the state to register vehicles within 10 days. Non-residents may operate with an out-of-state registration for 60 days. Visit the Alaska Department of Motor Vehicles website for more information.
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- In Arkansas, recent legislation (Act 1013) states that for a motor vehicle lease exceeding 30 days, the lessee is treated as the owner for personal property tax purposes.
- For motor vehicles, counties treat May 31 as the effective lien date for determining annual tax liability. Leased motor vehicles that are located, registered and subject to assessment in Arkansas on or before May 31 are taxable for the full year. Arkansas does not prorate motor vehicle property tax based on partial-year use.
- Vehicle values are set by the county assessor using state-approved valuation schedules.
- Property tax bills are issued by the county collector and are generally due by October 15. Failure to assess or pay personal property tax may prevent vehicle registration or renewal.
- Visit the Arkansas Department of Finance and Administration (DFA) website for more details.
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- The Connecticut Department of Motor Vehicles (DMV) provides local assessors with vehicle registration data, including vehicle age, plate number, registration date, garaging address and owner name and address. This information is transmitted annually for the Grand List as of October 1 of that year, and periodically throughout the year for vehicles registered after October 1, which may result in supplemental assessments.
- Vehicle values are determined annually by the local assessor using standard valuation guides (e.g. NADA/JD Power) and assessed at 70% of fair market value as of October 1.
- A recent legislative change (HB 5043) modifies how and when supplemental property tax on motor vehicles may be billed. Previously, all supplemental vehicles were billed only on January 1. HB 5043 will impact property tax on motor vehicles as follows:
- If vehicles are registered between October 2 and March 31, taxes are due July 1 of the same assessment year.
- If vehicles are registered between April 1 and September 30, taxes are due January 1 of the following year.
- Because Connecticut taxes motor vehicles in arrears, tax bills may be issued after a lease has ended, and the customer remains responsible for taxes properly assessed during the period of registration.
- Connecticut requires plates to be canceled or transferred after lease return or if you move out of state. Visit Connecticut's DMV website and search ‘Plate Return’ for instructions. Then, send Tesla a copy of your cancelation receipt or updated registration (for transfers) to support potential refunds. You are responsible for any taxes assessed if your license plates are not canceled upon lease return.
- In Connecticut, motor vehicle property tax liability follows the owner of record.
- For leased vehicles, the owner of record is typically the lessor (e.g. Tesla Lease Trust), not the customer. Because of that, most exemptions intended for individual taxpayers do not apply to leased vehicles, even if the lessee personally qualifies.
- Individual jurisdictions may opt to grant exemptions, such as active military or disabled veterans, but are not required to by law. Contact your local tax assessor’s office to inquire about possible exemptions.
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- In Kentucky, vehicle registration information is provided to county officials through the Kentucky Transportation Cabinet and Department of Revenue systems. County Property Valuation Administrators (PVAs) use this data to identify taxable vehicles and assign them to the appropriate jurisdiction based on where the vehicle is principally garaged as of January 1 of each year.
- Vehicle values are established annually by the Kentucky Department of Revenue using a standardized valuation guide and applied uniformly by county PVAs. If the vehicle moved out of state after January 1 or the lease terminated, all taxes are still due for that year because of the state's non-prorating status.
- For leased vehicles, motor vehicle property tax is billed directly to the owner on record, and the tax is due based on the owner’s incorporation (charter) date.
- Upon the move out, return a copy of the new states title or registration to Tesla for refund processing.
- For lease terminations, complete the Application for Kentucky Certificate of Title or Registration. This will remove the vehicle from future billings. If you purchase your leased vehicle, contact your County Clerk’s office immediately to transfer the title into your name. Failing to notify the County Clerk of your move or purchase could result in additional Kentucky taxes being billed to your account.
- Active Military Personnel should contact the county’s Property Valuation Administrator (PVA) to confirm if they qualify for tax exempt status at the beginning of the lease. You will need to provide a copy of your leave and earnings statement (LES). In most cases, you may only qualify if you are housed on the Military Base and are from another state.
- Visit the Kentucky Transportation Cabinet website for more information.
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- Motor vehicle personal property tax is referred to as excise tax in Massachusetts. The Massachusetts Registry of Motor Vehicles (RMV) provides vehicle registration information to the local assessors throughout the year, including vehicle value, age, plate number, registration date, garaging address and owner name and address. The assessors then share this information with the local tax collectors for distribution and collection of payment.
- After the initial registration, a bill will be issued covering the registration date through December 31 of that year. Subsequent bills are typically issued annually between March and April and will cover the entire calendar year.
- The excise tax rate in Massachusetts is fixed state-wide at a current rate of $25 per $1,000 of the vehicle value. The assessed value is based on the vehicle’s original MSRP and a statutory depreciation schedule established by Massachusetts law, not current market value. To dispute the amount of excise tax being billed, contact [email protected] with your concern and any plate cancelation documents.
- You are responsible for any taxes assessed if your license plates are not canceled or transferred upon lease return. Cancel or transfer them promptly through the Massachusetts RMV, retain the cancelation receipt or updated registration (if you are keeping the plate) and forward a copy to Tesla for potential refund processing.
- Active military personnel should contact their local tax assessor’s office to confirm if they qualify for tax exempt status at the beginning of their lease. You will need to provide a copy of your leave and earnings statement (LES).
- Disabled veterans with a VA-certified, service-connected disability may qualify for an excise tax exemption or reduction. Contact your local assessor’s office with your DD214 form or VA letter stating you are eligible for the HERO Act exemption.
- Qualifying leases under charitable, religious or educational non-profit organizations may qualify for an excise tax exemption. You must provide a copy of the ST-2 exemption form as well as a copy of your lease agreement to the assessor for review.
- Learn more about excise tax in Massachusetts.
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- In Missouri, the vehicle owner (Tesla Lease Trust) is required to file a business personal property rendition for vehicles located (tax situs) in a county appraisal district as of January 1. Renditions are due the following March 1. Vehicles garaged in the county as of that date are taxable for the full year, as Missouri does not prorate motor vehicle personal property tax.
- Annual rendition reports include lease commencement date, original cost and a recommended market value. Vehicle values are determined by the county assessor using valuation guidelines issued annually by the Missouri State Tax Commission and assessed at 33 and one third of value.
- To renew the vehicle's registration, a copy of the paid receipt is needed. Visit your taxing jurisdiction’s website to confirm if tax receipts are available online.
- If your lease begins after January 1, the vehicle is not taxable in Missouri as of the assessment date and the county assessor may issue a statement of non-assessment or waiver to allow vehicle registration for that year.
- Active-duty military exemptions may be available in limited circumstances. Eligibility depends on residency, ownership and use, and leased vehicles may not qualify. Customers should contact the county assessor for eligibility requirements.
- Visit the Missouri Department of Revenue website for more information.
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- In Texas, the vehicle owner (Tesla Lease Trust) is required to file a business personal property rendition for vehicles located (tax situs) in a county appraisal district as of January 1. Renditions are generally due the following April 15, with extensions available upon timely written request.
- Annual rendition reports include lease commencement date, original cost and a recommended market value. Appraisal districts ultimately determine taxable value.
- Texas does not prorate motor vehicle business personal property tax. Taxes cover 12 months and are based entirely on ownership and garaging address as of January 1.
- Tax bills are sent in October and are due the following January 31. Vehicles may be assessed by multiple entities such as county, city, hospital, school or other special districts, depending on garaging location. These entities may bill separately or together, which could result in multiple individual bills per vehicle.
- Vehicles leased for personal use may qualify for an exemption under Texas Tax Code §11.252. The vehicle must not exceed an empty weight of 9,000 pounds, and 50 percent or more miles driven in a year must be for non-income producing purposes. The appraisal districts review and approve the exemption requests. This exemption does not apply to opt-out cities that have chosen to tax personal use leased vehicles.
- Form 50-285, Lessee’s Affidavit Motor Vehicle Use Other Than Production of Income must be completed by the lessee and returned to Tesla by Jan 15 of the filing year. These Texas affidavits are provided to you by Tesla during lease paperwork signing. If Tesla does not receive your completed and signed copy, you may be taxed. If you are unsure if Tesla has your signed affidavit on file, a blank affidavit can be located online at the Texas Comptroller’s website. Search for Form 50-285 on the website. Forward all signed affidavits to [email protected].
- Below is a list of opt-out cities in Texas. If you are in one of these cities, they can assess your vehicle despite a personal use exemption.
County Appraisal District Cities That Tax Leased Vehicles for Personal Use Archer Megargel Armstrong Claude Bexar San Antonio Briscoe Quitaque Carson Panhandle Castro Hart, Nazareth Collin Carrollton, Frisco, Richardson, Garland, Colorado Columbus Comal Bulverde, Fair Oaks, Garden Ridge, Schertz, Selma Cottle Paducah Dallam Dalhart, Texline Dallas Addison, Carrollton, Cedar Hill, Desoto, Garland, Lancaster, Mesquite, Richardson Denton Argyle, Frisco, Justin, Lake Dallas, Pilot Point Donley Clarendon Duval San Diego Eastland Cisco Edwards Rocksprings El Paso Anthony, El Paso, Horizon, Socorro Ellis Ennis Fort Bend Meadows Place, Richmond, Rosenberg Gregg Kilgore, White Oak Harrison Beaumont, Kilgore, Longview Hays San Marcos Hood Granbury Jefferson Beaumont, Groves, Nederland, Port Arthur, Port Neches Johnson Cleburne Live Oak George West, Three Rivers Marion Jefferson McMullen Tolden Texas Midland Midland Nueces Corpus Christi Oldham Adrian, Vega Parmer Bovina, Friona Rockwall Royse Schleicher El Dorado Sherman Stratford, Texhoma Swisher Happy, Kress Tarrant Lake Worth, Forest Hill, Hurst Travis Austin Trinity Groveton, Trinity Waller Waller Wichita Wichita Falls, Electra Williamson Austin -
- The Virginia Department of Motor Vehicles (DMV) provides local jurisdictions with vehicle registration and garaging address information throughout the year. As the vehicle owner, Tesla Lease Trust will also file annual or monthly renditions to local Commissioner of Revenue (COR) offices to supplement and/or update the DMV’s information. Motor vehicle personal property tax is assessed and billed at the local level by the city or county in which the vehicle is garaged.
- Vehicle values are determined by the local Commissioner of Revenue using standard valuation guides as of January 1 of that year and may be subject to applicable relief programs such as the Virginia Personal Property Tax Relief Act (PPTRA). Most localities assess vehicles at 100% of the determined value. Property tax is determined based on the taxing jurisdictions tax rate, the vehicle's value and the number of months the vehicle is garaged in the jurisdiction (if prorating).
- In Virginia, proration is done by using full month increments. A taxpayer is liable for a full month's tax if the vehicle has been in the jurisdiction for more than half a month. Proration may apply for new registrations, lease returns, total losses or moves into or out of jurisdiction.
- It is the customer’s responsibility to update their address with their local tax authority upon any address changes. Failing to do so could result in multiple tax assessments.
- Contact the Commissioner of Revenue of the respective jurisdiction to dispute any property tax being billed. If an adjustment is applied to the bill, contact [email protected] to confirm receipt.
- The state of Virginia advises plates to be canceled after your lease vehicle is returned or you move out of state. You can visit the Virginia Department of Motor Vehicles website for more information on the process. The plate cancelation receipt helps secure tax roll corrections.
- Personal Property Tax Relief (PPTRA) applies only to qualifying personal-use vehicles and reduces a portion of the tax approximately attributable to the first $20,000 of value (local caps vary).
- Active Military Personnel should contact their local tax authority assessor’s office to confirm if they qualify for tax exempt status at the beginning of the lease. You will need to provide a copy of your leave and earnings statement (LES) and Lease Agreement.
- Visit the Virginia Department of Motor Vehicles website for more details.
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- In West Virginia, owners are required to file an annual personal property return with the county assessor reporting all vehicles owned as of the July 1 lien date. Returns are due by the following September 1.
- Vehicles are valued by the county assessor using state-recognized vehicle valuation schedules and applied uniformly to all vehicles on the July 1 lien date.
- Property tax bills are issued and collected by the county sheriff and are payable in two installments:
- 1st half due: September 1 – with discount (delinquent after October 1)
- 2nd half due: March 1 – with discount (delinquent after April 1)
- Because West Virginia taxes property based on lien date ownership, full-year tax remains due for vehicles owned as of July 1, even if a lease ends or the vehicle leaves the state later in the year.
- West Virginia requires proof that personal property tax has been paid in order to register a vehicle.
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