Ala. Admin. Code r. 810-6-3-.42.03 - Sales Of Certain Automotive Vehicles To Nonresidents For First Use And Registration Or Titling Outside Alabama
(1)
(a) Effective January 1, 2016, sales of
automobiles, motorcycles, trucks, truck trailers, or semitrailers that will be
registered or titled outside Alabama, that are exported or removed from Alabama
within 72 hours by the purchaser or purchaser's agent for first use outside
Alabama are not subject to Alabama sales tax provided the following conditions
are met:
1. the state sales tax laws of the
state in which the purchaser will title or register the vehicle allows an
Alabama resident to purchase a motor vehicle for first titling and registering
in Alabama without the payment of tax to that state.
2. The exempt sale is documented on the
Automotive Vehicle Drive Out Certificate For Nonresidents.
(b) Effective July 1, 2022, sales of travel
trailers, campers, or housecars that are exported or removed from Alabama
within 72 hours by the purchaser or purchaser's agent for first use outside
Alabama are not subject to Alabama sales tax provided that the conditions in 1.
and 2. above are met and the following additional documentation is collected
and retained:
1. Copy of sales
invoice.
2. Copy of the purchaser's
valid state-issued identification card, state-issued driver's license, U.S.
passport, or for entities, a copy of the same for the individual signing for
the purchase. An entity must also provide a copy of the same for a member of an
LLC or a member of the board of directors for a corporation as well as the
location the travel trailer, camper, or housecar will be housed upon export
from Alabama.
(2) The certificate must be executed by both
the seller and the purchaser or the purchaser's agent at the time of the sale.
A certificate executed subsequent to the time of the sale shall be invalid and
the Alabama sales tax shall be due from the seller on the sale for which the
invalidated certificate was prepared.
(3) The certificate, properly completed, must
be retained in the seller's records with a copy of the corresponding sales
invoice, and when applicable, the additional documentation required in
subparagraph (1)(b). The certificate and documents shall be available for
inspection or examination by the department or any authorized agent during
normal business hours. The seller will be liable for the Alabama sales tax on
any sale for which the export exemption has been claimed but for which a
properly executed certificate and sales invoice, and when applicable,
additional documentation required in subparagraph (1)(b) are not maintained in
the seller's records.
(4) A
Certificate of Exemption - Out of State Delivery is not required for sales
which qualify for the export exemption contained in Section 40-23-2(4) and for
which the certificate is properly executed and maintained.
(5) Sales of other vehicles such as mobile
homes, all terrain vehicles, and boats do not qualify for the export exemption
provision and are taxable unless the seller can provide factual evidence that
the vehicle was delivered outside Alabama or to a common carrier for
transportation outside Alabama.
(6)
In the event the laws of the state in which the purchaser will title or
register the vehicle do not allow an Alabama resident to purchase a motor
vehicle for first titling and registering in Alabama without the payment of tax
to that state, the sale of the automotive vehicle to the nonresident will be
subject to the Alabama state automotive sales tax rate. The tax collected will
be state tax and will exclude county and municipal sales tax.
(7) A list of states that do not allow a
reciprocal drive-out provision for Alabama residents purchasing automotive
vehicles for first titling and registration in Alabama may be viewed on the
Department's website at: http://www.revenue.alabama.gov/salestax/.
Such list will be updated annually. Sellers that have relied on list
information that is later determined to be incorrect shall not be held liable
for the non-collection of the state automotive sales tax.
Notes
Authors: Ginger Buchanan, Christy Vandevender
Statutory Authority: Code of Ala. 1975, §§ 40-2A-7(a) ((5), 40-23-2(4), 40-23-31.
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
(1) Effective January 1, 2016, sales of automobiles, motorcycles, trucks, truck trailers, or semitrailers that will be registered or titled outside Alabama, that are exported or removed from Alabama within 72 hours by the purchaser or purchaser's agent for first use outside Alabama are not subject to Alabama sales tax provided (i) the state sales tax laws of the state in which the purchaser will title or register the vehicle allows an Alabama resident to purchase a motor vehicle for first titling and registering in Alabama without the payment of tax to that state and (ii) the exempt sale is documented on the following form:
STATE OF ALABAMA
AUTOMOTIVE VEHICLE DRIVE OUT CERTIFICATE FOR NONRESIDENTS
Click to view image
NOTICE: This form does not apply to and may not be used in conjunction with the sale of mobile homes, all terrain vehicles, motor homes, travel trailers, or boats. The 72 hour drive out provision does not apply to sales of these automotive vehicles. This form does not apply to and may not be used for sales to non-residents when the laws of the state in which the non-resident will title or register the vehicle does not allow an Alabama resident to purchase a motor vehicle without the payment of tax to that state. The tax to be collected on such sales is the two percent (2%) Alabama sales tax.
However, in no case shall the amount of Alabama state sales tax due on a motor vehicle that will be registered or titled for use in another state exceed the amount of sales tax that would otherwise have been due in the state where the vehicle will be registered or titled for first use.
FAILURE TO PROPERLY COMPLETE AND MAINTAIN THIS CERTIFICATE IN THE SELLER'S FILES WILL RESULT IN THE SELLER BEING HELD LIABLE FOR THE ALABAMA SALES TAX.
(2) The certificate outlined in (1) above must be executed by both the seller and the purchaser or the purchaser's agent at the time of the sale. A certificate executed subsequent to the time of the sale shall be invalid and the Alabama sales tax shall be due from the seller on the sale for which the invalidated certificate was prepared.
(3) The certificate outlined in (1) above, properly completed, must be retained in the seller's records with a copy of the corresponding sales invoice. Both the certificate and the invoice shall be available for inspection or examination by the Department of Revenue or any authorized agent during normal business hours. The seller will be liable for the Alabama sales tax on any sale for which the export exemption has been claimed but for which a properly executed certificate and sales invoice are not maintained in the seller's records.
(4) A Certificate of Exemption - Out of State Delivery is not required for sales which qualify for the export exemption contained in Section 40-23-2(4) and for which the certificate outlined in (1) above is properly executed and maintained.
(5) Sales of other vehicles such as mobile homes, motor bikes, all terrain vehicles, motor homes, travel trailers, and boats do not qualify for the export exemption provision and are taxable unless the seller can provide factual evidence that the vehicle was delivered outside Alabama or to a common carrier for transportation outside Alabama.
(6) In the event the laws of the state in which the purchaser will title or register the vehicle do not allow an Alabama resident to purchase a motor vehicle for first titling and registering in Alabama without the payment of tax to that state, the sale of the automotive vehicle to the nonresident will be subject to the Alabama state automotive sales tax rate. The tax collected will be state tax and will exclude county and municipal sales tax.
(7) A list of states that do not allow a reciprocal drive-out provision for Alabama residents purchasing automotive vehicles for first titling and registration in Alabama may be viewed on the Department's website at: http://www.revenue.alabama.gov/salestax/. Such list will be published by December 1, 2015, and will be updated each December 1 thereafter. Sellers that have relied on list information that is later determined to be incorrect shall not be held liable for the non-collection of the state automotive sales tax.
Notes
Author: Ginger Buchanan
Statutory Authority: Code of Ala. 1975, §§40-2A-7(a)((5), 40-23-2(4), 40-23-31.