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Ezel / Tax Rulings / TX
TX 9005L1020C14 Motor Vehicle Tax 1990-05-02

Could multiple vehicles, including destroyed or stolen vehicles, support a fair-market-value deduction?

Short answer: Multiple vehicles could support deductions against one replacement with no numerical limit, but tax could not become negative. Destroyed or stolen vehicles did not qualify because they were not sold or offered for sale. Extra replaced vehicles could be listed on an attachment to Form 132-U.

Apply this to your situation

This page answers the general question as of 1990. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1990
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official 1990 Texas Tax Correspondence letter on historical fair-market-value deductions for replaced vehicles. It predates modern Private Letter Ruling reliance terms and cannot bind the Comptroller for unrelated taxpayers. Eligibility, the sold-or-offered-for-sale requirement, deduction limits, tax floors, documentation, and Form 132-U may have changed. The letter does not identify a statute or rule. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

The Texas Tax Correspondence Division allowed multiple replaced vehicles to support fair-market-value deductions against one replacement vehicle. It stated no numerical limit, but the deductions could not make tax negative.

If Form 132-U lacked space, the filer could attach a blank sheet and reference it on the form. Destroyed or stolen vehicles did not qualify because they did not meet the requirement that a replaced vehicle be sold or offered for sale.

What this means for you

The 1990 letter allowed aggregation but required sale or an offer for sale. Verify current eligibility, documentation, and forms.

Common questions

Q: Was there a limit on the number of replaced vehicles?

A: No, but tax could not become negative.

Q: Did destroyed or stolen vehicles qualify?

A: No.

Citations and references

  • The letter cited no statute or administrative rule by number.

Source

Original ruling text

May 2, 1990

Dear ****:

Thank you for your recent letter regarding the fair market value
deduction for replaced motor vehicles. Mr. Swenson has asked that
I respond to your letter.

Multiple vehicles may be used as fair market value deductions for
a single replacement vehicle. There are no limits; however, the
tax due can not be a negative amount as a result of the multiple
deductions.

In a situation where the form 132-U can not accommodate all of the
replaced vehicles, a blank sheet may be attached with reference
made to the attachment on the face of the form 132-U.

You also asked about the eligibility status of destroyed/ stolen
vehicles as fair market value deductions. Vehicles that have been
destroyed/ stolen do not meet the requirement that a vehicle must
be sold or offered for sale.

This opinion is based on the facts presented. If there are
additional or different facts, the opinion may change.

If you have any questions or need additional information, you may
call me tollfree at 1-800-252-5555, extension 5-0330. The regular
number is 512- 463-4600, or write me at Tax Correspondence,
Comptroller of Public Accounts.

Sincerely,

Bettie U. Peterson
Tax Correspondence Division

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