Tennessee Vehicle Cost Guide 2026
Tennessee charges 7% state sales tax plus local taxes on vehicles. Annual registration includes a county fee. Tennessee wound down its last county emissions programs (Memphis ended 2022) and requires no periodic inspection; it is not a no-fault state. Minimum liability is 25/50/25.
DMV / Registration Fees
| Title Transfer | $11 |
| License Plate Fee | $10 |
| Registration (Base) | $27 |
Insurance Requirements
What to know about vehicle costs in Tennessee
Tennessee charges 7% state sales tax plus local taxes on vehicles. Annual registration includes a county fee. Tennessee wound down its last county emissions programs (Memphis ended 2022) and requires no periodic inspection; it is not a no-fault state. Minimum liability is 25/50/25.
How Tennessee vehicle taxes and fees add up
Buying and registering a car in Tennessee involves several separate costs. The state levies a 7.00% sales tax on the purchase price. On top of the purchase price you pay one-time DMV fees to transfer the title and issue plates, plus an annual registration fee of about $27 to keep the vehicle legal on the road.
Insurance is the largest recurring cost for most drivers. Full coverage in Tennessee averages about $1,800 per year, which works out to roughly $150 per month. Over a typical five-year ownership period that is about $9,000 in insurance alone.
Worked example: buying a $35,000 car in Tennessee
To make these numbers concrete, here is what a $35,000 vehicle roughly costs to put on the road in Tennessee, using the state sales tax plus the average local rate shown above:
| Vehicle price | $35,000 |
| Sales tax (7.00%) | $2,450 |
| One-time DMV fees (title, plates, registration) | $48 |
| Estimated out-the-door total | $37,498 |
| First-year insurance (average) | $1,800 |
Illustrative estimate. Actual tax, fees, and insurance vary by county, vehicle type, and your personal circumstances. Confirm final figures with your state DMV and insurer.
Car insurance requirements in Tennessee
Tennessee is an at-fault (traditional liability) state, so the driver who causes an accident is generally responsible for the other party's losses. Drivers must carry at least $25,000 per person / $50,000 per accident in bodily injury liability and $25,000 in property damage liability. Uninsured/underinsured motorist coverage is $25,000/$50,000. Most drivers choose limits well above the minimum to protect their assets, and lenders typically require comprehensive and collision coverage while a loan is outstanding.
Tennessee does not require a statewide vehicle inspection, though some counties operate emissions testing programs.
Tennessee EV and alternative-fuel incentives
VehCalc does not track a standing state-level EV purchase credit for Tennessee in 2026 — several programs have wound down, and the federal EV tax credit ended September 30, 2025. Incentives change frequently, so verify current eligibility with your state energy office or the vehicle manufacturer before relying on any credit. Local utilities sometimes offer separate rebates for home charging or EV purchases.
How to lower your Tennessee ownership costs
- Negotiate on the vehicle price, not the monthly payment — sales tax is charged on the price.
- Compare at least three insurance quotes; premiums for the same driver vary widely.
- Raise your credit score before financing to qualify for a lower APR.
- Check current EV and efficiency incentives that may apply to your vehicle.
- Keep registration and inspections current to avoid late fees and penalties.
Frequently asked questions about vehicles in Tennessee
How much is sales tax on a car in Tennessee?
Tennessee charges a 7.00% state sales tax on vehicle purchases. Your total sales tax is the state rate plus any local district rate that applies where you register the vehicle.
How much does car insurance cost in Tennessee?
Full-coverage car insurance in Tennessee averages roughly $1,800 per year. Your actual premium depends on your driving record, the vehicle, your coverage limits, and where you live within the state.
Is Tennessee a no-fault insurance state?
No. Tennessee is a traditional at-fault (liability) state, so the driver who causes an accident is generally responsible for the other party's injuries and property damage.
Does Tennessee require vehicle inspections?
There is no statewide inspection requirement in Tennessee, although some counties may run emissions testing. Confirm the rules with your state DMV.
What are Tennessee's minimum car insurance requirements?
The minimum liability coverage in Tennessee is $25,000 per person / $50,000 per accident for bodily injury and $25,000 for property damage. Uninsured/underinsured motorist coverage is listed as $25,000/$50,000.
How much is vehicle registration in Tennessee?
Annual vehicle registration in Tennessee runs about $27. When you title a newly purchased vehicle you may also owe a title-transfer fee of $11 and a plate fee of $10.
Ownership costs for popular models in Tennessee
Every purchase in Tennessee carries a 7.00% state sales tax, about $1,800/yr average insurance, and a 6.39% typical new-car loan APR. Open any model below to see its pre-filled 5-year cost of ownership tuned to Tennessee.
Calculate Your Costs
Use our auto loan calculator with Tennessee tax rates to estimate your total vehicle costs.
Open Auto Loan Calculator →