When purchasing a vehicle in Tennessee, the price you see on the lot is only part of what you’ll actually pay. Tennessee’s Tax, Title, and License (TTL) fees can add thousands of dollars to your final cost. Our calculator helps you understand exactly what you’ll owe before you sign on the dotted line.
Tennessee has a unique tax structure that differs significantly from other states. Unlike states with a simple flat sales tax rate, Tennessee applies three separate tax components to vehicle purchases, each with its own calculation method and cap. Understanding these components is crucial for accurate budgeting.
The Three Components of Tennessee Vehicle Sales Tax
Tennessee’s vehicle sales tax system is governed by Tennessee Code Annotated §§ 67-6-202, 67-6-331, and 67-6-701. Here’s how each component works:
1. State Sales Tax (7%)
The state sales tax is straightforward: 7% of the entire taxable amount. This is the base tax that applies to all vehicle purchases in Tennessee, regardless of location or vehicle price. According to the Tennessee Department of Revenue, this 7% state rate has been consistent since 2002.
State Tax = Net Taxable Amount × 0.07
2. Local Option Tax (2.00% – 2.75%)
This is where Tennessee’s system gets interesting. The local option tax varies by county and city, ranging from 2.00% to 2.75%. However, it only applies to the first $1,600 of the vehicle’s taxable amount.
For example, whether you’re buying a $15,000 sedan or a $75,000 truck, the local tax only applies to the first $1,600. This cap is established under TCA § 67-6-331.
Important Exception: Two Tennessee counties have different local tax caps:
- Hamblen County (unincorporated): $300 cap
- Hancock County: $375 cap
Local Tax = MIN(Taxable Amount, $1,600) × Local Rate
3. Single-Article State Tax (2.75%)
Tennessee adds an additional 2.75% “single-article” tax on the portion of the vehicle price between $1,600 and $3,200. This means vehicles priced over $3,200 will pay this tax on exactly $1,600 of the purchase price (the amount between $1,600 and $3,200).
This tax is codified in TCA § 67-6-202(c) and is unique to Tennessee’s tax structure.
Single-Article Tax = MIN(MAX(Taxable Amount – $1,600, 0), $1,600) × 0.0275
Real-World Example: Breaking Down the Numbers
Example: $30,000 Vehicle Purchase in Nashville
Purchase Details:
- Vehicle Price: $30,000
- Dealer Documentation Fee: $500
- Trade-In Value: $5,000
- Location: Nashville, Davidson County (2.75% local rate)
Step 1: Calculate Gross Sales Price
$30,000 + $500 = $30,500
Step 2: Calculate Net Taxable Amount
$30,500 – $5,000 (trade-in) = $25,500
Step 3: Calculate Sales Tax Components
- State Tax (7%): $25,500 × 0.07 = $1,785.00
- Local Tax (2.75%): $1,600 × 0.0275 = $44.00
- Single-Article Tax (2.75%): $1,600 × 0.0275 = $44.00
Total Sales Tax: $1,873.00
What Reduces Your Taxable Amount (And What Doesn’t)
Critical Distinction: Not all discounts are treated equally under Tennessee law.
What DOES Reduce Your Tax:
- Trade-In Value: Your trade-in is subtracted from the purchase price before calculating tax (TCA § 67-6-501)
- Dealer Discounts: Direct price reductions from the dealer
What DOES NOT Reduce Your Tax:
- Manufacturer Rebates: Because these are considered “third-party payments” under Tennessee law, they do NOT reduce your taxable amount
- Factory Incentives: Same reasoning as manufacturer rebates
What INCREASES Your Taxable Amount:
- Dealer Documentation Fees: These are added to the purchase price and ARE taxable
- Other Dealer Fees: Any additional dealer charges are taxable
Tennessee Title Fees: What You’ll Pay
Title fees in Tennessee are standardized across the state, as established by TCA § 55-6-108:
| Fee Type | Amount | When Required |
|---|---|---|
| State Title Fee | $5.50 | All transactions |
| County Clerk Fee | $8.50 | All transactions |
| Lien Notation | $11.00 | Per lien (if financed) |
| Duplicate Title | $14.00 | If needed |
Most vehicle purchases will pay the standard $14.00 title fee ($5.50 + $8.50). If you’re financing the vehicle, add $11.00 for lien notation.
Registration Fees: Based on Vehicle Class and Weight
Tennessee registration fees are determined by vehicle classification under TCA §§ 55-4-111 and 55-4-113:
| Vehicle Class | Registration Fee | Examples |
|---|---|---|
| Class A | $16.75 | Motorcycles, autocycles |
| Class B | $23.75 | Passenger cars, pickup trucks |
| Class C | $30.00 | Antique vehicles (35+ years) |
| Class D – Small | $14.50 | Small trailers |
| Class D – Large | $24.00 | Large trailers, mobile homes ≤8 ft |
| Class D – Mobile | $36.00 | Mobile homes >8 ft wide |
| Commercial Freight | $39.53 – $656.20 | Weight-based (9,000-80,000 lbs) |
Commercial Freight Trucks: Weight-Based Fees
Commercial freight trucks pay registration fees based on their Gross Vehicle Weight (GVW). Fees range from $39.53 for vehicles up to 9,000 lbs to $656.20 for vehicles between 76,001-80,000 lbs. Additionally, freight trucks weighing 16,000 lbs or more pay an additional $95 trailer/semi tax.
Electric and Hybrid Vehicle Surcharges
Tennessee law requires additional annual fees for electric and hybrid vehicles to compensate for lost fuel tax revenue. These fees are established under TCA § 55-4-115:
| Vehicle Type | 2024-2026 | 2027+ |
|---|---|---|
| All-Electric Vehicles | $200 | $274 |
| Plug-In Hybrid Vehicles | $100 | $100 + inflation adjustment |
County Wheel Taxes: The Local Variable
One of the most confusing aspects of Tennessee vehicle registration is the county wheel tax. Each of Tennessee’s 95 counties sets its own wheel tax rate, which can range from $0 to $55 per year.
For example:
- Davidson County (Nashville): $55
- Shelby County (Memphis): $50
- Knox County (Knoxville): $35
- Rutherford County: $0
Important: Always verify the current wheel tax rate with your county clerk’s office, as rates can change annually based on county budget decisions.
Special Circumstances and Exemptions
Gift Transfers
Vehicles received as gifts are exempt from sales tax in Tennessee, but you must still pay title and registration fees. Proper documentation proving the gift transfer is required.
Out-of-State Purchases
If you purchased a vehicle in another state and paid sales tax there, Tennessee will credit that amount. However, if the other state’s tax rate was lower than Tennessee’s, you’ll pay the difference.
Military Personnel
Active-duty military personnel stationed in Tennessee may be eligible for certain exemptions. Contact the Tennessee Department of Revenue for specific guidance.
Location-Specific Tax Rates: Why Your Zip Code Matters
Tennessee has over 475 different tax jurisdictions, each with its own combined rate. Our calculator includes all current rates from the Tennessee Department of Revenue’s official database, including:
- All 95 Tennessee counties
- Major cities with special tax districts
- Special tax jurisdictions
Combined rates range from 9.00% to 9.75% depending on your location. The most common rates are:
- 9.25%: County areas with 2.25% local tax
- 9.75%: City areas with 2.75% local tax
How Our Calculator Ensures Accuracy
Our Tennessee TTL Calculator is built on official data and legal statutes to provide the most accurate estimates possible:
- Official Tax Rates: All 475+ location tax rates from the TN Department of Revenue
- Current Fee Schedules: Based on TCA §§ 55-4-111, 55-4-113, and 55-6-108
- Up-to-Date EV/Hybrid Fees: Reflects 2024-2027 fee schedules per TCA § 55-4-115
- Accurate Tax Logic: Implements the three-component tax calculation exactly as specified in Tennessee law
Tips for Reducing Your Tennessee Vehicle Costs
- Maximize Your Trade-In: Since trade-ins reduce your taxable amount, getting the best trade-in value directly reduces your tax bill
- Negotiate the Price, Not the Payment: Focus on the actual vehicle price, as this is what determines your tax
- Understand Dealer Fees: These are taxable, so negotiate them down when possible
- Consider Timing: If you’re on the border of a tax bracket (like $1,600 or $3,200), small price adjustments can affect your tax
- Check for County Incentives: Some counties offer reduced wheel taxes for certain vehicle types
Common Questions About Tennessee Vehicle Taxes
Do I pay sales tax on a used car in Tennessee?
Yes, Tennessee charges the same sales tax on both new and used vehicles. The tax is based on the purchase price, not the vehicle’s age.
Can I avoid sales tax by buying from a private party?
No, Tennessee requires sales tax on all vehicle purchases, whether from a dealer or private party. You’ll pay the tax when you register the vehicle.
How much are tag and title fees in Tennessee?
The standard title fee is $14.00. Registration fees vary by vehicle type, ranging from $14.50 to $36.00 for most passenger vehicles. Add $10 for a new license plate.
Does Tennessee charge tax on trade-ins?
No, your trade-in value is subtracted from the purchase price before calculating sales tax, which can save you hundreds of dollars.
Legal References and Sources
- Tennessee Code Annotated § 67-6-202: State sales tax on motor vehicles
- Tennessee Code Annotated § 67-6-331: Local option sales tax provisions and caps
- Tennessee Code Annotated § 67-6-501: Trade-in credit provisions
- Tennessee Code Annotated § 67-6-701: Single-article tax on motor vehicles
- Tennessee Code Annotated § 55-4-111: Registration fees by vehicle class
- Tennessee Code Annotated § 55-4-113: Commercial vehicle registration fees
- Tennessee Code Annotated § 55-4-115: Electric and hybrid vehicle fees
- Tennessee Code Annotated § 55-6-108: Title fees and requirements
- Tennessee Department of Revenue: Official sales tax rate database (updated quarterly)
- Tennessee County Clerks: Local wheel tax rates and registration procedures
Disclaimer: This calculator provides estimates based on current Tennessee law and official fee schedules. Actual costs may vary slightly based on specific circumstances, county policies, and recent legislative changes. Always verify final costs with your county clerk’s office or vehicle dealer.