Gifting a Car in Delaware: Taxes, Fees & Rules (2026)
The doc fee is waived for gifts from immediate family — spouse, parent, child, sibling, grandparent, including step- and in-law relations — on Delaware-title-to-Delaware-title transfers, plus joint-owner and inheritance transfers. The title fee of $35 still applies. Verified against official Delaware sources on 2026-07-17.
Gift vs. selling for $1: don't use the $1 trick
The old advice to "sell it for a dollar" usually backfires. A $1 sale is still a sale — in states that tax the higher of price or book value, that means tax on the full book value; in others it simply voids the gift exemption you were entitled to use. The documented gift route (affidavits, the right box on the title) is what actually produces $0 tax where an exemption exists.
What you'll still pay in Delaware
Even a fully exempt gift pays the standard title transfer fee of $35. The recipient also takes on normal registration costs going forward. Delaware publishes no separate late-title penalty — titling happens at registration, which is required before driving.
Good to know
- Title fee is $35 without a lien, $55 with one.
Frequently asked questions
Do you pay taxes on a gifted car in Delaware?
The doc fee is waived for gifts from immediate family — spouse, parent, child, sibling, grandparent, including step- and in-law relations — on Delaware-title-to-Delaware-title transfers, plus joint-owner and inheritance transfers.
Is it better to gift a car or sell it for $1 in Delaware?
Gift it — properly. A $1 "sale" is still a sale in most states and can trigger tax on book value or invite a review, while a documented gift uses the actual exemption. The doc fee is waived for gifts from immediate family — spouse, parent, child, sibling, grandparent, including step- and in-law relations — on Delaware-title-to-Delaware-title transfers, plus joint-owner and inheritance transfers. Follow the gift procedure, not the $1 shortcut.
What does the title transfer cost on a gifted car in Delaware?
The title fee is $35 — that's due on gifts too, even when the tax is exempt. Delaware publishes no separate late-title penalty — titling happens at registration, which is required before driving.
Does the IRS tax a gifted car?
Almost never for normal vehicles — car values fall under the IRS annual gift-tax exclusion for most givers, so no federal gift tax or return is required. The state-level rules above are what actually matter.
Verified against official sources (news.delaware.gov, dmv.de.gov) — last reviewed 2026-07-17. Estimates are informational only.