tavt – title ad valorem 101 · 2019. 1. 7. · tavt history • several previous attempts to...
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TAVT – Title Ad Valorem Tax 101
Speakers
Clint Mueller, Legislative DirectorAssociation County
Commissioners of Georgia
50 Hurt Plaza, Suite 1000Atlanta, Georgia 30303
Vicki Lambert, Director Local Government Services Division and Motor Vehicle
Division, Georgia Department of Revenue
4125 Welcome All Rd., Suite 701Atlanta, Georgia 30349
Learning ObjectivesAt the end of this session, you will be able to‐• Discuss the history of the TAVT and who is eligible to receive TAVT revenue
• Recall what is taxable and how the tax is calculated• Discuss the distribution of the TAVT between the county, cities, and schools and how the funds can be expended
• Discuss the impact of the TAVT on local government budgets and how administrative fees for collecting the tax are calculated
• Recall recent legislative changes that impact the administration and collection of the tax
TAVT History
• Several previous attempts to eliminate the “Birthday Tax”
• Passed as part of 2012 Tax Reform (HB 386)• Amended during the 2013 legislative session (HB 266 and HB 463)
• Implemented March 1, 2013• Amended during the 2014 legislative session (HB 729)
Calculation of the Tax
• Tax Rate ‐ standard, “buy here pay here”, salvage, rental, charitable donation, vehicles titled prior to 1985
• Determining Taxable Value– New vs. Used– Deductions – trade in, discounts and rebates– Appeals
• Family Transfers• Welcome to Georgia
TAVT Calculations
• Standard Transactions:– Vehicle value = 12,000
• Trade in value = 0– Amount of TAVT due (value * 6.75%) = $810
– Vehicle value = 12,000• Trade in value = 4,000
– Amount of TAVT due (value * 6.75%) = $540
TAVT Calculations
• Rental Cars– Value of vehicle = 25,000
• Trade in value = 0– TAVT due (value * 1.25%) = $312.50
• Family/Inheritance Transfer (vehicle in TAVT)– Value of vehicle = $10,000
• Trade in value = 0– TAVT due (value * 0.50%) = $50.00
Exemptions
• Corrected, replaced or reissued titles• Commercial Trucks that are registered under the International Registration Plan (IRP)
• Military Veterans (disabled, POW, Purple Heart, Medal of Honor)
• Trailers• Other non‐titled vehicles
Collection of the Tax
• Who pays the tax (Dealer vs. Purchaser)• When is the tax paid• Where is the tax paid• Refunds• Administrative/Collection Fee
Distribution of the Tax
• Collection period and date of disbursement• Schedule for allocation between state and local governments
• Formula for allocation among local governments (Who is an eligible local government)
• Distribution of delinquent payment penalties
Distributions – You do the math!
• Amount of TAVT Collected for Month = 100,000• Step 1 – True up Ad Valorem Tax
Jurisdiction
Ad Valorem Tax Collected Month 2012
Ad Valorem Tax Collected Month 2014
True Up Amount
County $20,00 $15,000
School $35,000 $26,000
City 1 10,000 $8,000
Total
Distributions – You do the math!
• Step 2 – Remainder of TAVT split
Distribution Entity Percentage Amount Totals
1st Third School Board 100%
2nd Third County 75%
City 25%
3rd Third County 60%
City 40%
Distributions – Answers
• Amount of TAVT Collected for Month = 100,000• Step 1 – True up Ad Valorem Tax
Jurisdiction
Ad Valorem Tax Collected Month 2012
Ad Valorem Tax Collected Month 2014
True Up Amount
County $20,00 $15,000 $ 5,000
School $35,000 $26,000 $ 9,000
City 1 10,000 $8,000 $ 2,000
Total $16,000
Distributions – Answers
• Step 2 – Remainder of TAVT split ($100,000 ‐ $16,000 = $84,000)
Distribution Entity Percentage Amount
1st Third School Board 100% $28,000
2nd Third County 75% $21,000
City 25% $ 7,000
3rd Third County 60% $16,800
City 40% $11,200
Impact on the Local Government Budget
• Comparing old system (ad valorem and sales tax on vehicles) to new system (trailing ad valorem tax and TAVT)
• Hold Harmless Provision• Impact on Local Option Sales Tax Revenues• Legal Use of Revenue• Accounting for the tax
TAVT Revenue Statistics• $1,457,814,356 collected in revenue as of 4/20/2014• Standard Transactions (6.5 or 6.75%)
– 1,800,657– $1,355,855,792
• Opt‐In transactions– 566,384– $14,135,192
• Out of State– 119,991– $55,419,709
Questions?
Thank You
Clint Mueller, Legislative DirectorAssociation County
Commissioners of Georgia
50 Hurt Plaza, Suite 1000Atlanta, Georgia 30303
Vicki Lambert, Director Local Government Services Division and Motor Vehicle
Division, Georgia Department of Revenue
4125 Welcome All Rd., Suite 701Atlanta, Georgia 30349