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You May Be Entitled To A Credit Toward Your Next License Plate Registration Fee
If your motor vehicle is totaled as the result of an accident, you may be entitled to seek a “credit” toward the license plate registration fee for a replacement vehicle. Money is money and a “credit” is the same thing.
License plate registration fees are paid to the state in advance for a twelve-month period. The state gets its money up front. However, if during the twelve month registration period, your motor vehicle is destroyed to the extend that it cannot be operated on a public highway, and if the prorated portion of the registration fee for the number of month remaining is more than $15.00 (this means $15.01 and up), you are entitled to seek and receive a registration fee “credit.”
For example, assume a license plate registration fee was paid in the amount of $60.00 to cover a twelve-month period from June of one year to June of the next. Then assume the vehicle was destroyed in the following August. A simple calculation is all that is necessary to determine if the owner would be entitled to a “credit” for the remaining months of September through to June of the following year. Merely divide $60.00 by twelve. This works out to $5.00 per month. Then multiply $5.00 times the number of months remaining before the license plate would expire. In this case it is ten month. $5.00 times 10 equals $50.00. Since this is “more than” $15.00, the owner may apply for a “credit” toward the cost of a license plate registration fee for a replacement vehicle.
Hopefully, the owner saves license plate registration receipts and remembers to remove the license plates from the vehicle before it is hauled off by an insurance company that pays the total loss. Getting the plates and finding the receipt may take time, but it can be worth it.
To claim the credit, the owner must send the registration fee receipt (keep a copy) and the license place for the vehicle to the department of public transportion and execute a written statement on a form provided by the department showing that the license plates have been surrendered along with satisfactory proof that the vehicle was destroyed. Satisfactory proof of destruction can be furnished by a copy of the police report and an insurance company’s statement that it has made this determination incident to a claim for the loss.
Once the department has the paper work and the plates, it will issue a registration fee “credit” slip to the owner in an amount equal to the prorated portion of the fee for the remainder of the registration year. This credit slip may be used by the owner during the same or the next registration year, as payment or part payment for the registration of another vehicle to the extend of the credit. Do not forget to give the new or used automobile dealer where you purchase a replacement vehicle the credit slip, keeping a copy for yourself, to off set the cost of the vehicle registration which he will otherwise add in to your purchase.
On may think this a lot of trouble for nothing but remember, the credit is not taxable to the individual. But a new purchase without the credit would be paid for in before Tax Dollars.
Look in the administrative code of Texas which provides this benefit.
§ 502.182. Credit for Registration Fee Paid on Motor Vehicle Subsequently Destroyed
(a) The owner of a motor vehicle that is destroyed to the extent that it cannot afterwards be operated on a public highway is entitled to a registration fee credit if the prorated portion of the registration fee for the remainder of the registration year is more than $15. The owner must claim the credit by:
(1) Sending the registration fee receipt and the license plates for the vehicle to the department; and
(2) Executing a statement on a form provided by the department showing hat the license plates have been surrendered to the department.
(b) The department, on satisfactory proof that the vehicle is destroyed, shall issue a registration fee credit slip to the owner in an amount equal to the prorated portion of the registration fee for the remainder of the registration year. The owner, during the same or the next registration year, may use the registration fee credit slip as payment or part payment for the registration of another vehicle to the extent of the credit.
(c) A statement executed under Subsection (a)(2) shall be delivered to a purchaser of the destroyed vehicle. The purchaser may surrender the statement to the department in lieu of the vehicle license plates.
(c) copyright - January 5, 2005
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