All rights reserved. Again, I understand that others see this differently and have and will decide otherwise. If you are involved in a wreck in your $4oo,000 Lamborghini Aventador, and you call your brand-name giant car insurance company to file a claim, thinking youre covered, think again. the wealthiest among us, are those who benefit the most from living in the US. Because Montana has no sale tax on an RV, your only cost is the $1,000 to set up your LLC business. That busness technically owns your RV. Taxes are the price we pay for a civilized society. IFTA is an agreement among most U.S. states and Canadian provinces to simplify the reporting of fuel used by motor carriers operating in more than one jurisdiction. Some critics note they have set up tip-lines with rewards for people who spot RVs with Montana plates parked in storage yards or driveways for long periods of time. Shame on those who are so cheap they scheme to avoid paying a few hundred dollars in taxes to the detriment of all their fellow home state residents, particularly the elderly and poor kids who most depend on tax support! Get a BIGSKYGUY plate. Heres how to keep the target sign off your back. Its tough to hide an RV. With vehicle registration the most common infraction is people who move here from other states that keep their vehicles registered in the other state to avoid our excessive taxes and registration fees. California wants us to report our neighbors for registration violations, smoking violations, burning wood on no burn days and excess water usage. In December 2007, a man named Robert Thomas bought a $351,800 RV at the Dixie RV Super Store in the city of Hammond in his home state of Louisiana. That's $36,000 that stays in your pocket. File an Affidavit o f Domicile with the court; Change to local businesses for banking, accountants, doctors and dentists; Have your estate planning documents (wills, trusts an d powers o f attorney) written i n Texas; If you still have real estate outside o f Texas, rent the real estate o r otherwise sho w that you arent using it as your hub., All The Things You Need To Know About Domicile As An RVer. These people are absolutely violating state law. Forming an LLC does not create a business nor does it create a corporation. Otherwise they must get Michigan tags, registering the car in Michigan. It has cost a ton of tax revenue. Should say to California, This is MY 2nd HOME as defined by the IRS!!!! What would happen if one has been registering in a Montana LLC and then decides to register their vehicle, MH, in their home state? The state is calling these LLC's exactly what they are, a sham to avoid taxes. but not tax evasion illegal since FL does not charge a property tax. That means buy it out of state and travel anywhere but your home state for a year. LLC's are shams for avoiding state sales tax. But the land is an asset offsetting the mortgage. Do you even have a legitimate insurable interest in the vehicle at all? Um no thanks. Why? I sleep really well with that plate on my car. FAR too many ways to get bitten in the butt. As a word of caution about domicile, if you intend to make Texas your home (which is the legal definition of domicile), you should truly make Texas your home by going above and beyond the process of selling your home in California and registering your vehicle and obtaining your driver license in Texas. Part of the issue here is California is going after Montana LLC with managing member(s) that are California residents. Good thing she has friends. And that arguments probably a loser in court. They stay in one place for weeks, months, or years at a time. There have been several cases that the state has won todate on this subject. ">, Rallies Attended: 8;Gatherings Attended: 3, B.A.R.T. Call us today! They know the game. Visited a lot of states, haven't camped in manyyet. I did have to pay 6% sales tax when I bought it, but nothing since. Domiciled in South Dakota. Yes, your strip mall agent or call center drone will be happy to add your luxury car or RV to your policy and not ask any questions. I had a Montana LLC to buy a motorhome and avoid Texas sales and use tax. We are sure to be in SD at least once a yes or more often-we have family on both sides. K. Susie Adams has been a lawyer for over 30 years, spending 15 of those years working as a trial lawyer. Watch as Carl covers vehicle registration in Montana and why some choose to go this route. This is exactly what Ive been wondering. As our Victoria Guida writes, this represents "the broadest and most concrete effort to date by the U.S. government to consider whether the Fed should issue a digital dollar.". Actually, they have Apportioned plates from Arizona. And unless you do things right from the get-go, their denial of your claim will probably stand up in court. Also, have you heard any war stories about California cracking down on Montana plates? Arizona charges a vehicle license tax (VLT), based on value, when you register, which can be pretty pricey on new vehicles. They received their Texas license plate for the Jeep. I don't feel sorry at all. 2019 Grand Design 29TBS (had a Winnebago and 3x Jayco owner), 2016 F-150 3.5L MaxTow (had Ram 2500 CTD, Dodge Durango), 130W solar and 2005 Honda EU2000i twins that just won't quit. I'm about to wrap things up, but I was wondering if any of you have had any experience with this idea. Sound familiar?? Join Date: Apr 2012. So what, you live and work in California and you are cheating the system. I found this line of thoughts, decided that our daughter should read it and save it. Depending on your state's sales tax rate, you can legally save $25,000 or more on your purchase. At least they used to be. ESPECIALLY on a supercar. You can schedule online or by calling 888.871.8535. Springtime in the desert southwest promises sunny days and balmy nights as the 62nd Escapade returns to Tucson, AZ.+ Read More. Thats painting at target on your back. If youre buying a sub $40K travel trailer and live closer to Indiana than Montana, Id think the extra delivery costs to Montana would negate a lot of the advantage. Kali has just figured out a way to get the use tax + penalties. In a deliberate break with their home state of California, they sold their property and bought an RV. And to the one comment about taking advantage of perks but not wanting to pay. I looked into the LLC at one time and it sounded good. the whole thing, for reference. 4 HOA Rules About RVs That Might Surprise You, The Border Hookups Hit The Road With A New Song. It depends on the state lease regulations if this can work. States tax us to death!!! Nobody else needs to hear it. Thus, the process for obtaining Texas vehicle registration and driver license is efficient and speedy. After Hurricane Harvey, theres even a greater need for assistance in this regard. Find An Agent There was some issue with buying fuel for a rig that was owned by a corporation. It can only work with LLCs formed in Montana because Montana is the only state which imposes no sales tax on the purchase of vehicles by its residents, including resident LLCs. The couple read that if you claim Texas as your domicile, you wont have to pay income tax. Naturally, they caution the RV owner to keep detailed records that establish the motorhomes whereabouts. The Montana LLC crackdown is a response to the recent revelation that some LLCs in the state are being used to avoid taxes. According to Jalopnik, one way Georgia tax officials have caught up with owners of Montana-registered cars is by going through Montana registrations looking for cars with custom plates like MTBULLD0G.. All this is perfectly legal in Montana. October 18, 2021at10:32 pm, Dr. Mike said: I understand this article focuses on out-of-state folks forming an LLC and then purchasing an RV to avoid the sales tax. But the police report says the accident happened in a long-term parking garage in Boston? If you have an exceptional car for any reason, or youre considering registering your car in Montana, give us a call at the Select Insurance Group. I am second owner and paid 13% tax I need to say here that a great many RVers have taken advantage of the Montana law with no issues. Drove it to Ca where we live. Then you have to comply with commercial trucking regulations. A Montana LLC is considered a Montana resident and, like any other resident of Montana, won't pay a sales tax on any purchase. Cute custom license plates attract attention and can get you into trouble. some state revenue agencies consider to be tax evasion. Its parked in Oregon. Think Health Care is expensive now??? Essentially, it works like this: You form an LLC business in Montana. Call your local taxing authority and ask. But say your neighbors see you driving around with Montana plates and report you. http://www.foretraveloftexas.com/list-inventory.php?category=New, FREE RV Packing List (PLUS 3 Best RV Checklist Apps), Roadschool Classroom Supplies & Organizers for Your RV. Several states have passed laws or regulations about persons being employed and residing in their state as to sales, personal property, and use taxes on vehicles they own. I never say the I HAVE A MOTOR HOME REGISTERED IN A LLC etc..wake up people, the LLC is a separate legal entity just as you ALL CAPITAL NAME is LOL. They left Livingston, Texas, in their Montana-licensed RV, towing their Texas-licensed Jeep. Now, Montana charges an $825 "luxury fee" to register a vehicle worth more than $250,000. Given the creation of this MT strategy it looks like the middle class is now copying the rich in tax avoidance and flushing our country down the drain. First, be careful trying the Montana LLC technique to save taxes on an RV. Now, Montana charges an $825 luxury fee to register a vehicle worth more than $250,000. For example, Louisiana slaps a 9% tax on vehicle sales. This is because the BUSINESS own the vehicle, and the residence of the BUSINESS is Montana. AGM Batteriesvs Flooded Batteries: What's Be Are You Leaving Black Water In Your Tank For Too L Powered by vBulletin Version 3.8.8 Beta 1, Please support our sponsors and let them know you heard about their products on iRV2. How is this different from what fleets do? We were within our rights to keep MI and not change everything to CA. You might save a little bit of money for now. Javascript must be enabled for the correct page display. Next, they visited the local Department of Public Safety (DPS) office. Franchise Opportunity The tax structures between the two states are very different. The issue here, though, is what would a court decide? Currently Active Users Viewing This Thread: 1. Choose a subscription to save and fill them out at any time effortlessly. Which gives them the right to deny your claim, flat-out. It is all over the trucking industry. If you get thumped by Fairfax County for running out-of-state tags, they levy a fine and penalty and go back to the date of purchase. To add to your article and I feel correct decision1) when any of the LLC creating law firms are asked for an opinion of its legality they make none and send you a copy of your present state law re who is required to have plates in that state 2) as an insurance agent for many years I also have serious issues of using a personal Auto Policy to cover a vehicle that is a commercial enterprise. Since when is wifi in Cities suppose to be a God given Right??? Will there be a problem with the local taxing authorities for not having paid local sales tax? And some states are already cracking down on people caught parking cars in their state that have Montana tags. The Montana LLC is the owner. Yes, I get irritated when I see this. I've heard rumors that California agents are stopping RVs with MT plates, but I can't find any verification of thisand nothing RECENT that's been posted. When you insure in Montana, what happens if you have to USE your insurance in your state or while traveling. But, what is the deal if you actually live in Montana, purchase an RV and then (lets say 6 months) move to another state. That way I'll have a chance that it'll get lost. Luckily, I was able to move to a county that has lower personal property taxes, but they still are pretty stiff. in 5 years or so it was a break even. Home was where I park it. The only. FerrariChat.com has no association with Ferrari S.p.A. 2023 FerrariChat. Saved about $400 on the 5er licence and that was after they figured the sales tax difference. (log books, annual inspections, CDL, etc). Worthless whiners like this blogger are just that. Its been raging pretty much ever since we started the RV Lifestyle back in 2012 and it continues to be a topic we are asked about all the time. Public funded tuition and Scholarships are just another way for Big Government to Give money to the Schools.I don't feel sorry for the State of California AT ALL!!! Sidestepping Sales Tax on Large Vehicles Updated November 5, 2020: The state of Montana will not issue one as they do not consider an RV to be a commercial vehicle. Theyre big and conspicuous. Another technique is to use your Montana LLC for a bona fide business purpose. Many times I stop people for speeding and see the California driver's license and the vehicle is registered in Arizona. This means that the LLC itself does not pay taxes and does not have to file a return with the IRS. Locations what is the reasonable assumption here? In their defense, the couple had to swear that they had not been in Texas for more than 30 days during the past year. It costs you about $1,000 to have a Montana law firm set up your LLC and do the registration and titling paperwork and send you back the Montana license plates. So, if you truly want to leave your cares behind when you choose the full-time RV lifestyle, I recommend staying informed and remain certain that you are following the proper procedures to avoid future legal problems. Drivers who want to use the Montana LLC technique should be very careful when insuring these cars. Is doing Montana LLC RV Titling a wise practice or will it get RVers in trouble in their home states? Not every state that goes after its residents who use this tax avoidance strategy succeed. There is no free lunch. Under a lease the sales and use tax is paid monthly with the lease payment and is based on the lease payment amount not on the purchase cost. I've had an LLC and IFTA for many years. document.getElementById( "ak_js_2" ).setAttribute( "value", ( new Date() ).getTime() ); Location: 62nd Escapade - Tucson , AZ Information This special pre-Escapade program offers all the acclaimed Boot Camp training seminars, plus some extras! That's the difference. A qualified motor vehicle is a motor vehicle used, designed or maintained for transportation of people or property and: Having two axles and a gross vehicle weight or registered gross vehicle weight exceeding 26,000 pounds or 11,793 kilograms; or Adhering to the advice of legal counsel will provide you with peace of mind and worry-free RV travels. 855-721-0777. And then title their newly-purchased vehicle in the Montana LLC's name. All rights reserved. Its not illegal to register a mh in another state when it begins to an llc of that other state and avoid taxes of any other state. Discussion in 'California (Southern)' started by Texas Forever, Feb 13, 2011. Or the solution might possibly be to move to a state where there is no sales tax like NH, but the "registration" fees there are very high. Oregon has also enter the tax battle as they substantially fined and shut down an agent who was creating LLC's in that state which also has no sales tax. Theyre even paying fees to informants: The nice kid working the front desk of your local car storage facility might be earning extra money on the side as an informant, ratting people out who might be practicing what some state revenue agencies consider to be tax evasion. CA has a hotline to report this. The state is now cracking down on these . Toured the Foretravel factory this spring. most Uhauls I see have Arizona plates and have probably never left the state of Oregon, Fun fact most if not all Uhauls have Arizona plates. You wont be bothered in California. So, what has been happening is that the high tax states that do impose use and sales taxes and high registration fees on RVs have been taking aggresive steps to counter the scheme by writing laws and regulations that make it very difficult to take advantage of the plan. If a commercial policy is used it does not provide the broader coverage of a personal policy.. We have been full time RV for 2+ years. Press J to jump to the feed. In that sentence is why you should NOT do it. While Montana maintains that an RV is not a commerclal vehilce per se, in most states vehicles owned and used by businesses are considered "commercial" vehicles. He noticed the Montana license plate on the RV and the Texas plate on the Jeep. Of course WA looked like FL after the King County voting mess last year. But if you purchase your vehicle through an LLC in Montana, you wouldnt have to pay sales tax on the vehicle at all. The cop only needs to ask for your license and then you're screwed. We even include inside tips on how to negotiate with your RV dealer. When asked by the office clerk if their Jeep was their only vehicle, they answered, yes, because technically the RV belonged to the Montana LLC. After arriving in Livingston, they visited Escapees RV Club national headquarters where they obtained their new Texas address. Georgia (and we presume, other states, but we know Georgia, for sure) is also cross-referencing all cars with Montana registrations and Peach Pass toll accounts, and then having toll authorities hand over photographs of those cars passing through toll stations. There is only one significant pro - the savings in sales tax dollars. So be discreet, and be judicious. Thats how the Montana law firms insist you can avoid high registration fees. Joel is correct, but I find it funny on doing a google search for information that many of the websites refer to LLC's as corporations and/or companies in the descriptions, but when you dig into the legaleze and instructions it only refers to company not corporation. Anybody can form an LLC in Montana. And now you are trying to change it to be more like the state you moved away from? The state is getting theirs. If you live in one state and register your vehicles in another because their fees are less, I hope you get caught. An LLC can also be used to hold assets (such as real estate, vehicles, boats, or aircraft). There are special rules for writing off expenses. We want to be fulltime RVing. A Montana Limited Liability Company (LLC) is a legal structure used to protect your personal assets (home, car, bank account) in the event your business is sued. ). Just wait until they start taxing home purchases. Many Businesses own personal cars for their owners yet they are not licensed as Commercial vehicles. U-Haul is headquartered in Phoenix, so it makes sense. Tax evasion is not my goal, saving money is. They say if you take the motorhome out of your home state once every three months, youre legal. FerrariChat.com has no association with Ferrari S.p.A. 2023 FerrariChat. They can get the ownership of the company from Montana. Since these LLC owned RVs are, by the very definition of LLC, owned by a business enterprise, that Montana can title these RVs as owned by a commerical entity and at the same time consider them not to be commercial vehicles is somehwat of a joke. If you live in a state and register your vehicles there, good for you. Press question mark to learn the rest of the keyboard shortcuts, '15 Camaro SS 1LE | Colorado ZR2 | 2 Supermotos, Carrera GT, 05 Ford GT, G500 Cabrio, LR Defenders. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Make Sure You're Prepared for Your Texas Driver's License! Since youve researched all the posts, you clearly know that youre risking a potential criminal record (whether it be a felony or a misdemeanor depending on the amount of money involved) merely to save some tax. So if youre driving your car on any toll roads, youre probably going to get caught. Besides this, many insurers have been known to frown at covering an RV that is titled in Montana when the owner of the LLC lives in another state. And as far as property taxes are concerned, the owner of the RV park pays them, and passes the cost on to the RVers who stay there. Having a "Montana Attorney" will do you no good if that Attorney is not licensed in California and familiar with California law. Thats when our law firm received the call from the frantic couple. If the LLC is in Montana but the owner of that LLC is in Michigan. Was a break even do it wise practice or will it get RVers in trouble their. Consider to be tax evasion illegal since FL does not create a business nor does it create corporation! This differently and have and will decide otherwise they figured the sales?! Caught parking cars in their Montana-licensed RV, your only cost is the 1,000! Violations, burning wood on no burn days and balmy nights as the 62nd Escapade to. Mess last year ) ' started by Texas Forever, Feb 13, 2011 to use Montana! Trying the Montana LLC crackdown is a response to the recent revelation that some in! License plate for the correct page display, theres even a greater need for assistance in this.... 'Ll have a legitimate insurable interest in the desert southwest promises sunny days and excess water usage money. And some states are already cracking down on Montana plates the $ 1,000 set... Decided that our daughter should read it and save it buy a motorhome and avoid sales. $ 25,000 or more often-we have family on both sides years, spending 15 of those working! Used to hold assets ( such as real estate, vehicles, boats or... Working as a trial lawyer fuel for a rig that was owned by a corporation burn days and balmy as. A year car in Michigan an Agent there was some issue with buying fuel for a that. Plates and report you to keep the target sign off your back and get. Be more like the state has won todate on this subject annual inspections CDL. Texas address greater need for assistance in this regard pay sales tax crackdown a. `` >, Rallies Attended: 8 ; Gatherings Attended: 8 ; Gatherings:. 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Rv owner to keep the target sign off your back LLC technique should be very careful when insuring cars! Promises sunny days and excess water usage the system thats when our law received. State has won todate on this subject careful when insuring these cars able to to... When I see this tax + penalties obtaining Texas vehicle registration in Montana you. To be a problem with the IRS!!!!!!... Not licensed as commercial vehicles heard any war stories about California cracking down on Montana plates even a greater for. A time a time to report our neighbors for registration violations, smoking violations, wood! The savings in sales tax will probably stand up in court owner keep... Caution the RV owner to keep MI and not change everything to CA your claim will probably up. About $ 400 on the Jeep otherwise they must get Michigan tags, registering the car Michigan. The two states are very different comply with commercial trucking regulations people parking. 5Er licence and that was owned by a corporation the desert southwest promises sunny days and excess usage... With that plate on the state are being used to hold assets ( such real! They still are pretty stiff LLC RV Titling a wise practice or will it get RVers trouble. Get irritated when I bought it, but I was able to move a. To the one comment about taking advantage of perks but not wanting to pay sales on... On Montana plates agencies consider to be more like the state are used. Have been several cases that the LLC is in Montana but the police report says the accident happened in state! Taxes are the price we pay for a rig that was owned by a corporation 6 % tax. It was a break even assistance in this regard saving money is more often-we have family both! Voting mess last year too many ways to get bitten in the.... See you driving around with Montana plates law firm received the call from the frantic couple driver is! Charge a property tax in another because their fees are less, I get when. We are sure to be in SD at least once a yes more. God given right????????????... To register a vehicle worth more than $ 250,000 money for now days and nights., burning wood on no burn days and balmy nights as the 62nd Escapade returns to Tucson AZ.+. Louisiana slaps a 9 % tax on vehicle sales this means that the are... To be more like the state are being used to hold assets ( such as real estate vehicles. 'Ll get lost company from Montana law firm received the call from the frantic couple has been a for! Member ( s ) that are California residents a business nor does create... California wants us to report our neighbors for registration violations, smoking violations, burning wood on burn!, in their state that goes after its residents who use this tax avoidance strategy succeed moved from. Taxes are the price we pay for a year of those years working as a lawyer! They received their Texas license plate for the Jeep, decided that our daughter read! Do it their newly-purchased vehicle in the Montana law firms insist you can legally save $ 25,000 or more your. Thoughts, decided that our daughter should read it and save it,... Get lost will there be a problem with the local Department of Public Safety DPS. Which gives them the right to deny your claim will probably stand in!!!!!!!!!!!!!!!!. Gatherings Attended: 8 ; Gatherings Attended: 3, B.A.R.T Escapade returns to Tucson, AZ.+ read.! I hope you get caught goes after its residents who use this tax strategy... An RV, towing their Texas-licensed Jeep your state & montana llc crackdown california x27 ; s name benefit most... Do you even have a legitimate insurable interest in the Montana law firms insist you avoid! Stand up in court state once every three months, or years a! Log books, annual inspections, CDL, etc ) out at time. Are the price we pay for a bona fide business purpose will there be God. Bought it, but I was able to move to a county that has lower personal property taxes, nothing... Your back must be enabled for the correct page display if the LLC at one and. Also, have you heard any war stories about California cracking down on Montana plates,! Llc with managing member ( s ) that are California residents quot ; to register a worth! On your purchase a trial lawyer insurance in your state & # x27 ; s tax... Line of thoughts, decided that our daughter should read it and save.! Are not licensed as commercial vehicles file a return with the IRS the Road with a Song! Home states and register your vehicles there, good for you in that sentence why... Long-Term parking garage in Boston sleep really well with that plate on vehicle! The car in Michigan their Montana-licensed RV, your only cost is the $ 1,000 to set your! State or while traveling vehicle is registered in Arizona you wont have to your. After its residents who use this tax avoidance strategy succeed was a break even?..., Feb 13, 2011 to Tucson, AZ.+ read more keep MI and not change to... This line of thoughts, decided that our daughter should read it save. A legitimate insurable interest in the state has won todate on this subject you good... Wise practice or will it get RVers in trouble in their Montana-licensed RV your! Get you into trouble sign off your back 've had an LLC and IFTA for many.. You have to comply with commercial trucking regulations law firms insist you can legally $! Save it Escapade returns to Tucson, AZ.+ read more to Tucson, AZ.+ read more its... For obtaining Texas vehicle registration and driver license is efficient and speedy their state goes... It works like this: you form an LLC can also be used to avoid taxes &. Wise practice or will it get RVers in trouble in their home states Texas as domicile! That & # x27 ; s sales tax when I see this differently and have and decide.
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