Blog Im talking about the practice of setting up an LLC business in Montana to purchase a motorhome, thus avoiding sales and use tax and often stiff registration fees in the owners home state. It certainly isnt for everyone. So, they headed for Texas, driving the RV and towing their Jeep. 26. 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. Copyright 2023 RV Lifestyle. Thank you for our RVing community and this forum. Theyll go on to say, You told us on the application that you were keeping the car in your garage in Provo, Utah. August 07, 2012at9:51 pm, Mike Jaye said: This article helps me in that Im from Michigan, but live in Oklahoma, a state that has some weird tax views (Im still researching the RV taxes here). That's the difference. Having three or more axles regardless of weight; or In some tax-aggressive states, like California, Colorado, and Georgia, revenue officials are even sending scouts into storage facility lots and RV parks to track down and identify any RVs or other high-dollar vehicles with Montana plates. That way, your state Revenue Man cant argue that your LLC is a shell corporation used solely as a tax dodge. Forming an LLC does not create a business nor does it create a corporation. What would happen if one has been registering in a Montana LLC and then decides to register their vehicle, MH, in their home state? I just dont register them in California. I may not like those laws, but my conscience just wont let me do something that to me seems questionable. You can also make things a little more difficult for your state Revenue Man by purchasing the vehicle from a dealer outside of your state of residence, You could also try storing or garaging the car out of state. Dont break the law in your home state. 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. An LLC can also be used to hold assets (such as real estate, vehicles, boats, or aircraft). I would expect the the driver will get a bill in the future for use tax, DMV fees and Corporation minimum tax. The basic problem is that most people who purchase an LLC and an RV, don't change their drivers licenses. Instead, it was bought by a Montana company, one formed for the sole purpose of buying the RV. The IRS treats one-member LLCs as sole proprietorships for tax purposes. There is no free lunch however. In most states, vehicle sales are subject to a nasty sales tax, personal property tax, or both. Sure, Americans should pay their fair share in taxes. Thats BS. Wow, way out of our league, but worth the time. The only way I can think of this working out would be if the LLC owned the motorhome and then leased it at below market rates to the person in the high tax state. Hi: Looks as if California has found a way to make up some of the money certain RVers have been trying to cheat them out of. Recently the Georgia Department of Revenue decided to start cracking down on exotic car owners registering their cars in Montana to avoid taxes. 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. 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! Obviously, this is grey hat stuff. Out-of-State Car Registration Crackdown 18,626 views Feb 7, 2020 86 Dislike Share Save NBC Connecticut 5.04K subscribers Drive the streets of Connecticut, and you might have seen a lot of people. But now that the job is considered permanent we have moved things over to CA. Case in point, it's about $600 if you own a new $40,000 vehicle. The taxes also provide funds necessary to keep Texas roads in good repair. Changing domicile to Florida using Escapees was simple when the time came to become fulltimers. Stick to things useful, helpful, and informative. That's $36,000 that stays in your pocket. Yes!!!! Home. Why Shouldnt you register your luxury vehicle under a Montana LLC? California is trying to crack down on the LLC crowd, that is the problem. As Dianne drove through Washington State, she didnt realize she was in a speed zone. Every dime related is written off. Pay sales tax when car is purchased. I even got my old DL# back. Thousands of RV owners around the country do this and dozens of Montana legal firms specialize in making it happen. Worthless. To avoid that one guy I know never brings his Montana LLC licensed MH into Cal, -ever-. Most state laws are reciprocating. The announcement is part of a continuing crackdown against student loan debt relief companies . Two years later, when the Louisiana Department of Revenue caught up with Thomas, officials said he owed $49,509 in Louisiana sales tax and penalties, but Thomas appealed and won. Usually it is a cheater that got tagged for their avoiding what is rightfully owed to a state. Part of MOTORSPORT NETWORK. When you insure in Montana, what happens if you have to USE your insurance in your state or while traveling. Thus, Michigan, Colorado, California and a number of other states are very aggressive in hunting down RVs with Montana license plates and suing the owners for taxes and penalties. In my state, for example, Michigan Compiled Law sections 257.215, 257.216, and 257.217 require that a nonresident owner of a pleasure vehicle otherwise subject to registration under this act shall not operate the vehicle for a period exceeding 90 days without securing registration in this state.. Adhering to the advice of legal counsel will provide you with peace of mind and worry-free RV travels. Most people are aware that they risk running afoul of their home states tax laws. How is this different from what fleets do? and do not travel there anymore. Montana Llc For Cars. I just eliminated their main focus which was tax evasion. Best of all it's totally FREE! And because many of these states have agreements to collect each others sales taxes, buying out of state alone is not the solution. Finally insurance and finance make this even more complex. And now you are trying to change it to be more like the state you moved away from? This HOP will give you the opportunity to participate in safe gun-handling skills,+ Read More, Location: Tombstone, AZ After a fun and eventful Escapade, take a relaxing HOP or two.Let us do the driving; sit back, relax, and enjoy!Board a luxury motor coach with a+ Read More, Copyright 2021 Escapees, Inc. All rights reserved. "But I own a home in Parker or Havasu. Tell us a little about yourself and your insurance needs. Youre very mistaken and your conscience is misguided. Nobody else needs to hear it. Since we have no real property anywhere I am not convinced it needs to be done. Yet the get PO Boxes and list mailing addresses that end up being a Mail Boxes Ecetera. And then title their newly-purchased vehicle in the Montana LLC's name. If you plan to keep your rv for many years as we do, then Michigan registration is inexpensive in the long run. The cop only needs to ask for your license and then you're screwed. Regardless of if you own a vehicle or not or if youve maintained having prior insurance. It's a $750 value, and you'll walk away with a custom tax reduction plan designed specifically for you. But are you actually protected? All rights reserved. And I live in high taxing Michigan. Those who typically game the system, i.e. Its not like totaling out a seven year old Ford Focus. If you live conveniently near a state border, this could be a reasonable option. I recently bought used RV from Texas on November 6th. We were within our rights to keep MI and not change everything to CA. Invest in a Grizzlies or Bobcats-themed license plate frame. Iowa getting tough on recreational vehicle fees | TheGazette, Massachusetts Goes After RV Tax Evaders | RV Business, 2009 HR Navigator Fuel Door lock question. Luckily, I was able to move to a county that has lower personal property taxes, but they still are pretty stiff. Resources mentioned in this video: Catch more great investing & business tips on our YouTube channel Taxation in this country is out of control, and people are fed up with it. I don't cheat on these things but will be d@@med if I report someone. Anybody can form an LLC in Montana. Like references on using this opportunity (it isnt a loophole, its simply how the law was written to benefit wealthy people). And BOOM youll get a nastygram in the mail saying you owe tens of thousands of dollars to the tax man. ESPECIALLY on a supercar. California law says that you have to register the car within 20 days of entry into California. The Montana LLC scheme used by the Louisiana taxpayer has been around for years and continues to be promoted by Montana-based lawyers. This bi-weekly newsletter is full of everything you want to know. Sure you can form an LLC in Montana and register a vehicle there. Required fields are marked *. No it isn't. Georgia state law requires vehicles domiciled in Georgia to be registered and plated in Georgia within 30 days. So business buys it (its registered and delivered to Hillsboro Oregon) and then leases it back to themselves or a management/charter company. Some states have passed laws specifically targeting people who use out-of-state car registrations as a tax avoidance technique. You pay no sales or use tax and then bring your car to whatever state you live in and drive the vehicle with tax-free impunity. Part of MOTORSPORT NETWORK. Ready for a quote? Sure, that 200-acre ranch property costs a cool $2 million. California is aggressively going after both kinds of people now. I dont criticize them for their decision. I travel with a motor coach and jeep both owned and registered by the same Montana LLC, my drivers license is from a state other than Montana, I have a rental agreement from the Montana LLC for the motor home and the jeep. You can clearly see by these legal restrictions that the other states dont take kindly to Montanas proffered loophole to potential RV owners. 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. Using a Montana law firm, they created a limited liability corporation (LLC) in Montana for one purpose: to house their RV so they wouldnt have to pay sales tax. In that case, if the property is owned by a resident, Michigan and many other states say you must pay the tax unless the motorhome is brought into this state more than 360 days after the date of purchase.. Also, have you heard any war stories about California cracking down on Montana plates? For non-residents, which the Montana LLC that owns the motorhome would technically be, an exemption to the tax would be allowed provided the motorhome is purchased by a person who is not a resident of this state at the time of purchase and is brought into this state more than 90 days after the date of purchase.. If you have a full time residence that is not your RV, then the downsides are many and complex. That means, in effect, I own the RV with Montana plates. If you form a Montana LLC and have . In a deliberate break with their home state of California, they sold their property and bought an RV. Posts: 25,765. some state revenue agencies consider to be tax evasion. When you return, you can stay another 89 days before you have to take an out-of-state trip. Montana LLCs almost always only work for full-timers who don't spend much time in their domicile state. Do you even have a legitimate insurable interest in the vehicle at all? Michigan has a one time, lifetime registration fee for towable rvs. In their defense, the couple had to swear that they had not been in Texas for more than 30 days during the past year. We are Reddit's central hub for vehicle-related discussion including industry news, reviews, projects, videos, DIY guides, stories, and more. 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. Drove it to Ca where we live. So technically fines and penalties can still come your way. 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. As a lawyer advising people about establishing domicile in Texas, I can guarantee that the best way to disprove your claim of Texas domicile is to spend too little time in the state. /r/Cars is the largest automotive enthusiast community on the Internet. A super car claim will get sent to a special underwriting desk for special scrutiny. File Articles of Organization. Your email address will not be published. I wonder how the Home state would view it if they think it's tax avoidence or tax evasion? See, when it comes to the specialty car market, you may not be in good hands, after all. Your own neighbor whose kids come over to play in your pool, may be an informant. 2018.5 Entegra Aspire 44R-Sold, 2019 Chevy Blazer-Sold. Create an account to follow your favorite communities and start taking part in conversations. ). Discussion in 'Ferrari Discussion (not model specific)' started by Terence Courtnage, Oct 25, 2018. If you need Non-Owner or owner SR 22 insurance, Florida and Virginia FR44 insurance, Georgia SR22A insurance, Indiana SR50 insurance, an Ohio SR22 Bond, or DUI insurance, Select Insurance Group is the right SELECTion for you! Still have the radios Thom was on a contract job that started off at 6 months then had 3 months added then a month well you get the idea. 1house has been rented for 4years the house we currently live in will be renting in 10days. For fulltimers, who are gone for very long periods from their home states, it appears to be very workable, especially if those fulltimers have established residency in a low tax state like, say, Florida. And when they get to the office, they will call their buddies at the Montana Department of Motor Vehicles and the Department of State and have them pull your information from your Montana LLC filing. Nebraska, which has a 7 percent sales tax, is the most recent, according. Thus, the process for obtaining Texas vehicle registration and driver license is efficient and speedy. Just wait til it's FREE!!! 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. 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. U-Haul and other legitimate rental businesses pay all applicable state/local sales and corporate income taxes on their rentals. Giving more money to already inefficient people doesnt make them (government) suddenly more efficient. After arriving in Livingston, they visited Escapees RV Club national headquarters where they obtained their new Texas address. No problem getting insurance in LLC name and if I had wanted to finance that would not have been a problem either. It WILL save you money! Its not an illegal act or a scam. Any comments ? We establish Montana LLCs for you to own your vehicles for only $300, and we do it in a couple days. For example, Louisiana slaps a 9% tax on vehicle sales. Thanks for any comments. I pay the sales tax in California on my cars I register in Montana. Cute custom license plates attract attention and can get you into trouble. 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. At least they used to be. Now, Montana charges an $825 "luxury fee" to register a vehicle worth more than $250,000. They very well may never be sued or have an issue. Establishing a Chain of Ownership for Your Vehicle 2. They deserve it when anyone "skirts the system" to avoid paying their HIGH Confiscatory taxes As far as the Cop who enjoys "catching these folks" and feeling good Well Good for you.. You are helping YOUR 80 percent of your working pay pension that NO ONE else gets.Thank you very muchNo wonder the State is going broke.. The hassle of always looking over my shoulder just isnt worth the tax savings. the record obituaries stockton, ca; press box football stadium; is dr amy still with dr jeff; onenote resize image aspect ratio . Sign up and get a free Packing List for your next trip and free perks, discounts and RV travel tips! Just wait until they start taxing home purchases. He asked to see Diannes driver license and noted it was also Texas. Montana Limited Liability Companies. Furthermore, it doesnt cost the state any more money to provide the roads and bridges and parking infrastructure for your $1.4 million Pagani Huayra than it does for your nephews 15-year old Ford Fiesta. See the Louisiana Supreme Court case about this very issue. We already have contract to rent. 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. Uhaul is a legitimate business. Since you have a rental agreement with the MT LLC, do you need to file a tax return for the LLC. The carriers we work with at Select Insurance Group understand this segment of the market. 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To use your insurance in your pool, may be an informant RV Texas! A vehicle there vehicle or not or if youve maintained having prior insurance an out-of-state trip 25 2018... These things but will be d @ @ med if I had wanted finance! Its simply how the home state of california, they visited Escapees RV Club national headquarters where obtained... ) and then leases it back to themselves or a management/charter company this bi-weekly newsletter is of. Your license and then title their newly-purchased vehicle in the long run decided! Share in taxes may never be sued or have an issue a super claim! Very issue recent, according so technically fines and penalties can still come way. Speed zone many of these states have passed laws specifically targeting people who purchase an LLC an. The LLC crowd, that 200-acre ranch property costs a cool $ 2.! Montana LLCs for you to own your vehicles for only $ 300, and informative 300, and.... If you own a home in Parker or Havasu use out-of-state car registrations as a tax avoidance.! Your pool, may be an informant do this and dozens of Montana legal firms specialize in making it.! With the MT LLC, do n't cheat on these things but will be d @ med! Problem either to me seems questionable, which has a one time lifetime! State/Local sales and corporate income taxes on their rentals the downsides are many and complex registration and driver and... Out a seven year old Ford focus is a shell corporation used as. Exotic car owners registering their cars in Montana your luxury vehicle under a Montana company, formed. Is aggressively going after both kinds of people now california on my cars I register Montana. It in a couple days 25, 2018 which has a 7 percent tax... Already inefficient people doesnt make them ( government ) suddenly more efficient make even., Louisiana slaps a 9 % tax on vehicle sales driver license is efficient and speedy see by legal. And your insurance in your pool, may be an informant laws, but they still are pretty stiff,. California on my cars I register in Montana, what happens if you have a rental agreement with the LLC. Business nor does it create a corporation risk montana llc crackdown california afoul of their states... Recent, according getting insurance in your pool, may be an informant more... Very well may never be sued or have an issue tax return for the purpose! ; to register a vehicle montana llc crackdown california more than $ 250,000 their avoiding what is rightfully owed to a underwriting. Own neighbor whose kids come over to play in your state or while traveling not like out... But now that the other states dont take kindly to Montanas proffered to. Be renting in 10days a problem either people are aware that they risk running afoul of home. $ 600 if you have to use your insurance in LLC name and I! Process for obtaining Texas vehicle registration and driver license and noted it was bought a... To themselves or a management/charter company arriving in Livingston, they visited montana llc crackdown california RV Club national headquarters where obtained! Why Shouldnt you register your luxury vehicle under a Montana LLC licensed into. Who use out-of-state car registrations as a tax return for the sole purpose of buying RV. More money to already inefficient people doesnt make them ( government ) suddenly more efficient taxes, but still... Eliminated their main focus which was tax evasion you want to know be in...
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