Auto Excise Tax Abatement

If you feel you are entitled to any adjustment of your excise bill, it is strongly recommended that you pay the bill in full, then contact the Manchester Board of Assessors for an abatement. Although payment of a bill is not a precondition for an abatement, an owner risks incurring late fees and penalties if an abatement is not granted. The assessors must receive applications for abatement any time within 3 years after the date the excise was due or 1 year after the date the excise was paid, whichever is later. Taxpayers must file on time to preserve the right to abatement and to appeal.

Abatements can be filed if the owner believes the assessment is incorrect, or if the vehicle was sold during the year in which is it being taxed and the registration was properly cancelled, or if the owner moved, registered the vehicle in another state, and cancelled the registration in Massachusetts, or did not renew the registration in Massachusetts. If the registration is cancelled, it is most important to return the plates to the Registry of Motor Vehicles and to obtain a plate return receipt. When an abatement is granted, excise bills are prorated by the month in which the car was last registered to him/her.

Moving Within Massachusetts

If a motor vehicle owner moves within Massachusetts he should immediately notify the Registry of Motor Vehicles of his new address. The owner must pay the motor vehicle excise to the town in which he resided on January 1st. If the owner moved before the first of the year, he must pay the tax to the new community to which the owner moved.

Moving Out of Massachusetts

If the owner of a vehicle moves out of Massachusetts and registers his vehicle in another state and cancels his Massachusetts registration or does not renew the Massachusetts registration, he can file an application for an abatement for that portion of the year after the month in which the motor vehicle was registered in the new state or in which the Massachusetts registration was cancelled, whichever is the later. Please that is necessary for a person who has moved out-of-state to cancel the registration in MA and obtain a plate return receipt in order to avoid problems with an excise tax abatement application or future registration in the new state.

Sold Vehicles

If you received an excise bill for a vehicle which has been sold, the seller must return the plate to the Registry of Motor Vehicles, get a plate return receipt, and file an application for abatement. The bill will be adjusted to reflect the portion of the year when the recipient of the bill owned the vehicle.

Traded Vehicles

If an excise bill is received for a vehicle which was traded and which was not owned in the calendar year stated on the bill, it is recommended to pay the bill and then file an application for abatement with the assessors. You must submit a copy of the registration for the new vehicle, which indicates the date of transfer. If an excise bill is received for a vehicle which was traded but which was owned for a portion of the calendar year stated on the bill, it is necessary to pay the bill and then provide a copy of the registration for the new vehicle, which indicates the date of transfer together with an application for abatement. The assessors can then adjust the bill to reflect the ownership for only part of the year, and grant the proper abatement. The bill on the trade-in vehicle is prorated back to the last day of the month prior to the one in which the vehicle’s registration was cancelled and the excise bill on the new vehicle will be prorated as of the beginning of the month in which the vehicle was registered.

Stolen Vehicles

If the vehicle is stolen and not recovered within 30 days, the owner will be entitled to an abatement if the theft of the vehicle was reported to the local police within 48 hours of discovery of the theft. After 30 days, the owner must surrender the certificate of registration and obtain lost plate return receipt. This receipt and the local police report of the theft should be presented to the Board of Assessors in order to apply for abatement. The board will adjust the bill and grant an abatement for the remaining portion of the year.

Leased Cars

Leased cars are still subject to excise tax. However, whose obligation for payment is determined by any terms in the original lease agreement. If not addressed, the driver should inquire of the leasing company. Normally, if the car is registered in the driver’s name, the registration creates an obligation and liability for payment of excise tax upon the driver, not the leasing company. Even if the car is registered in the leasing company’s name, however, there may be terms in the contract passing on any taxes, excise included, onto the driver, so it is best to check the contract.

If the application for abatement is denied at the local level, the denial can be appealed to the State Appellate Tax Board. No abatement can reduce a tax to less than $5.00 and no abatement of less than $5.00 will be granted.

It is important to remember that no excise tax bill should be ignored.