Personal Property Tax Relief (car tax relief)

What is personal property tax relief?

The Personal Property Tax Relief Act (PPTRA) of 1998 provides tax relief for passenger car, motorcycle or pickup or panel truck with a registered gross weight of less than 10,001 pounds. If a qualified vehicle's assessed value is $1,000 or less, the Commonwealth's share of the tax is 100%. For qualified vehicles, the tax bill is reduced by the applicable tax relief percentage for the tax year on the first $20,000 of assessed value.

Tax relief percentage

2014 | 44.65% 2015 | 43.81% 2016 | 40.22% 2017 | 40.40% 2018 | 39.43%

2019 | 37.67% 2020 | 37.21% 2021 | 35.05% 2022 | 32.24% 2023 | 31.79%

 

Vehicles qualified for tax relief are noted on the tax bill and show a reduction for the portion of the tax the Commonwealth will pay. The County will be reimbursed by the Commonwealth for the amount of the reduction once the taxpayer has paid the balance due shown on the bill.

Qualified vehicles

• Any passenger car, motorcycle, pickup or panel truck with a registered gross weight of less than 10,001 pounds
• The vehicle must be owned or leased by an individual and NOT used for business purposes.
• Leased vehicles for personal (non-business) use qualify when the leasee is responsible for payment of the personal property tax by the terms of the lease agreement.

Non-qualified vehicles
Any passenger car, motorcycle, pickup or panel truck with a registered gross weight of more than 10,000 pounds. 

Business vehicles
If you can answer yes to any of the following criteria, your vehicle is considered predominantly used for business purposes and does not qualify for Personal Property Tax Relief. Therefore, the taxpayer would be responsible for full payment of the tax.

• More than 50% of the mileage for the year is used as a business expense for federal income tax purposes or reimbursed by an employer.
• More than 50% of the depreciation associated with the vehicle is deducted as a business expense for federal income tax.
• The cost of the vehicle is expensed pursuant to Section 179 of the Internal Revenue Service Code
• The vehicle is leased by an individual and the leasing company pays the tax without reimbursement from the individual.

Owners of vehicles are required to certify to the County of Montgomery that their vehicles remain qualified to receive car tax relief. Therefore, it is important to review the information sent to be sure that vehicles are properly qualified. If the information is wrong, the DMV will need to be updated and a personal property change form must be filed with the Commissioner’s office. When the owners pay their taxes on PPTRA-qualified vehicles, this certifies to the Commissioner of the Revenue that the vehicle has been qualified correctly. Information about Personal Property Tax Relief Act is also available on the Commonwealth of Virginia website.