For Consumers

How insurers calculate taxes and fees when your car is totaled

What taxes and fees are pro-rated in a total loss settlement?

How are pro-rated taxes and fees calculated?

Taxes and fees are calculated on a pro-rata basis so the vehicle owner is compensated for the “unused” portion of the annual taxes and fees.

Example: A car’s annual renewal occurred in March. The car is totaled in June. (This means three months of the annual taxes and fees have been used.)

The annual RTA tax is $120 per year. The insurance company owes nine months or 9/12th of the RTA tax.

$120/12 months = $10/month

$10 X 9 months = $90 (the pro-rated fee)

How is salvage value handled when you decide to keep your totaled car?

After the actual cash value, sales tax and applicable pro-rated taxes and fees are added together, the insurance company deducts the salvage value from the total amount.


Actual cash value: $15,375

Sales-tax rate (Seattle 9.8%): $1,506.75 

Total: $16,881.75

Example of annual government taxes and fees subject to pro-rating based on the unused portion of the license tab

Annual government fees and taxes example

Type of fee


RTA ( (King, Snohomish and Pierce counties only) must be calculated individually


Licensed fee


Weight-based fee (varies by vehicle weight)


Other regional fees (if any)


Filing fee


Subtotal for fees


Actual cash value plus sales tax


Total settlement value


Example of how the salvage value is handled when you decide to keep your totaled car

Salvage value breakdown when you keep totaled car example

Payment breakdown


Total settlement value before deductions, if any


Deductible, if any (collision deductibles)


Total payment


Salvage value


Total payment, if owner keeps car