I have heard of that being done.... but I have also heard that DMV will no longer just take your word for it. They use KBB prices -- and for vehicles without a reliable KBB figure, they will make their own estimate. 
I haven't had them check ever...but the claimed price paid for the vehicle should also seem at least somewhat realistic. Because they can't prove that a seller only asked what is stated on the paperwork.
I believe DMV allows free "gifting" but only to immediate family members... there's something on their website about that but I haven't looked at it in awhile.
This is correct! Gifting is only allowed between siblings, child to parent and parent to child relations including step children/parents and step siblings and this is also the only smog loophole for transfer of title as they do not require a smog inspection for such title tranfers as well!
but this is easy to use even if the last name is different because they will not and cannot prove your relationship nor do they have the time and resources to do so!
(catch my drift)
