Auto Title Laws in Illinois
The Illinois state government requires automobiles to be titled so that it can keep up with who owns vehicles in the state, and drivers need titles to prove that they own their auto in case they want to sell it. The underlying rationale for the auto titling system is that autos are of relatively high value, and consequently are tempting targets for theft and lucrative sources of state sales tax.
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Who Needs Illinois Title
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Illinois residents must generally obtain an Illinois title for their auto. Exceptions apply if the auto is not habitually used in Illinois, if the auto is held by a manufacturer or for sale by a licensed dealer and if the auto is primarily used in interstate transport. You don't need an Illinois title if you are an out-of-state resident driving in Illinois, but your auto must be registered in the jurisdiction of your residence.
Title Transfer
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If you buy an auto from a licensed auto dealer, the dealer will handle title transfer paperwork for you. If you engage in a transaction with a private party, however, you will need to handle the title transfer together, even if no money is exchanged -- in the case of gift or inheritance, for example. The title certificate contains a title transfer section. You must list the name of the buyer and seller, and provide an accurate odometer reading. The buyer and seller must sign this section. The buyer must complete form VD-190 for title transfer and registration, and turn it in to the local office of the Illinois Secretary of State along with a $95 processing fee as of 2011.
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Duplicates And Corrections
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If you lose your title certificate, you should immediately apply for a duplicate using Form VSD-190. You will need to list the odometer reading and the Vehicle Identification Number engraved somewhere on your auto. If you need to correct the information on the title certificate -- for example, if you changed your name due to marriage or are adding a lien, complete Form VSD-190 and state the reason for the correction.
Sales Tax
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If you obtain an auto without paying for it -- for example, as a gift -- you don't have to pay sales tax. If you pay for it, however, you will have to pay. Submit Form RUT-50 within 30 days of purchase if you bought the auto from a private party, and submit Form ST-556 within 20 days of delivery if you bought it from a licensed dealer. These forms are not available online -- you must call the Illinois Central Registration Division at 217-785-3707 to obtain them. The amount if the tax is based on the auto's book value, not its sales price, unless you paid at least $15,000 for it. The basic sales tax rate is 6.25 percent, although local variations apply.
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References
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