What you sign, what you keep, what you can get back, and how much a trade-in saves in sales tax in Indiana. Last checked 2026-10-30.
Short answer: to sell a car privately in Indiana, every owner on the title signs and prints their name in the seller section, and you fill in the odometer reading, date of sale, price and buyer's details. Take your license plate off: in Indiana the plate stays with you, not the car. The buyer has 45 days to title it at a BMV branch: $15 for the title, a $30 penalty if they're late, and 7% sales tax on the price. Afterward you can apply to get part of the excise tax you paid back as a credit or refund. If you trade in at a dealer instead, Indiana taxes the price of the car you buy minus your trade-in, new or used: on a $10,000 trade-in that's $700 less sales tax.
| Step | What to do |
|---|---|
| Every owner signs | "All vehicle owners must sign and print their names in the seller section prior to the sale" (Indiana BMV FAQ). Don't hand over a title signed but otherwise blank. |
| Fill in the sale details | The seller completes "the odometer statement, date of sale, purchase price, and purchaser information section" on the title (same BMV FAQ). |
| Clear any loan first | The lien has to come off before the title can move. On a paper title the lender signs the lien release section or gives you a lien release letter; on an electronic title the lender releases the lien electronically (Indiana BMV: Liens). |
| Take your plate off | "The seller should remove the license plate from the vehicle at the time of the transaction." You don't return it to the BMV; you can move it to another car you own (Indiana BMV: Buying & Selling). |
| Keep proof of the sale | Keep a copy of the front and back of the signed title, or a bill of sale with the buyer's name, date, price and your signature. You'll need it for the excise tax credit below, and the BMV accepts either one as proof (Indiana BMV: Fees & Taxes). |
The BMV's own checklist for sellers doesn't include a notary.
Indiana collects a vehicle excise tax every year with your registration. When you sell, you can apply for a credit or refund of part of what you paid with the BMV's Application for Vehicle Excise Tax Credit / Refund (State Form 55296), mailed in with proof of the sale or trade-in (Indiana BMV: Fees & Taxes, State Form 55296).
Trading in at a dealer counts: the form accepts proof of a trade-in.
| Item | Amount |
|---|---|
| Certificate of title | $15 |
| Late penalty if the title isn't applied for within 45 days | $30 |
| Sales tax | 7% of the purchase price, paid at the BMV branch when the buyer titles the car |
| Plates | Their own: a new registration, or $9.50 to move a plate they already have |
Sources: fees, Indiana BMV fee chart (revised January 1, 2026); 45 days and sales tax at the branch, Indiana BMV: Buying & Selling: "If a vehicle is purchased privately, the sales tax must be paid at a branch when you apply for the Indiana certificate of title." The buyer also pays registration and excise tax to plate the car.
Federal law requires a written mileage disclosure when ownership changes. Cars from model year 2011 on stay covered until they're 20 years old; model year 2010 and older are exempt (49 CFR 580.17). In Indiana it goes in the odometer statement on the title, so write the actual number from the odometer the day you sell.
Indiana taxes the price minus the trade-in allowance when you trade a car in to the dealer you buy from, whether the car you're buying is new or used (Indiana Department of Revenue, Sales Tax Information Bulletin 28S). At Indiana's 7% rate:
| Trade-in value | Sales tax saved (new or used) |
|---|---|
| $5,000 | $350 |
| $10,000 | $700 |
| $15,000 | $1,050 |
| $20,000 | $1,400 |
Sell the car yourself and buy from a dealer, and you pay tax on the full price of the next car. That saving is what a private sale has to beat. Trade in or sell it yourself? · Trade-in tax in other states
Who keeps the license plate when you sell a car in Indiana? The seller. Indiana's BMV says the seller should remove the plate at the time of the sale. You don't return it to the BMV; you can transfer it to another vehicle you own for $9.50. The buyer gets their own plate and registration.
Does an Indiana car title need to be notarized when you sell? The BMV's checklist for sellers doesn't include a notary. Every owner listed on the title signs and prints their name in the seller section, and the seller fills in the odometer reading, date of sale, purchase price and buyer's information.
How long does the buyer have to title a car in Indiana? 45 days from the purchase. After that the BMV charges a $30 administrative penalty on top of the $15 title fee, and the buyer pays 7% sales tax on the price at the branch.
Can I get my excise tax back when I sell my car in Indiana? You can apply for a credit or refund of part of it with State Form 55296 and proof of the sale or trade-in, such as a copy of the signed title or a bill of sale. The credit can go toward another BMV transaction; whatever is unused after 90 days is refunded by check, minus a $3 fee.
Does a trade-in lower the sales tax in Indiana? Yes, new or used. Indiana taxes the price minus your trade-in when you trade it to the dealer you buy from. At 7%, that's $700 less tax on a $10,000 trade-in.
Do private car sales in Indiana pay sales tax? Yes. The buyer pays 7% sales tax on the purchase price at a BMV branch when they apply for the title.
General information from Indiana and federal sources, not legal or tax advice. Check with the Indiana BMV before you sell. How we estimate your trade-in value · Selling in Michigan · Selling in Ohio · Selling in Illinois · Selling in Wisconsin
How we calculate it · Trade-in tax by state · What dealers make · Trade in or sell? · What dealers check · Owe more than it's worth? · When to sell · Selling a car by state · Stop calls & texts