Can my roommate transfer her car to me as a gift?

Question

I am living in TX. My roommate is planning to leave the country so she wants to give me his car as a gift. I am not paying her anything and the car is a seven years old car (Maximum 4000$). I wonder to know if it is possible for her to give it to me as a gift, or I should pay tax for that.

Answer 1

You are not family so a tax free gift is out of the question.  You will have to claim it as a gift and pay income tax on it.  Or she could sell it to you for a price which you pay sales tax on.  The latter would probably be cheaper.  

Another thought would be for her to keep the title in her name and allow you to register and insure it in yours.  Have her sign the title prior to leaving so you can sell the car for her if you ever want to.