CEO, Select Insurance Group, Select Insurance Group "Quote, SELECT & Save! California law says that you have to register the car within 20 days of entry into California. These people are absolutely violating state law. Its not an illegal act or a scam. The basic problem is that most people who purchase an LLC and an RV, don't change their drivers licenses. 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! Id like to see extra posts like this . All rights reserved. Domiciled in South Dakota. All rights reserved. CHP clamping down on drivers who avoid California fees. Found it odd that the GMC Sierra I rented had AZ plates. Establishing a Chain of Ownership for Your Vehicle 2. 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. Also, be careful driving your RV with Montana tags while towing your car with California tags in California with a California drivers license. New comments cannot be posted and votes cannot be cast. Theyll argue that you made false statements on your application. Just do a Google search on Montana LLCs and youll see how they are trying to drum up business by touting LLCs that allow you to buy no sales tax motorhomes or tax free.. As a matter of fact, the California IFTA guide book states that RV's are not considered under that reg.Thats a 2003 edition that was sent to my next door neighbor and when he called, they reportedly told him that had been changed.!!! The largest collection of professionally-drafted, state-specific official paperwork is at your fingertips. but alas the. significant infos. A newly retired couple, lets call them David and Dianne, did their homework before becoming full-time RVers. 2022 Genesis GV-80. I am not a lawyer so take what a I say carefully. You can schedule online or by calling 888.871.8535. Discussion in 'California (Southern)' started by Texas Forever, Feb 13, 2011. 2018.5 Entegra Aspire 44R-Sold, 2019 Chevy Blazer-Sold. Like references on using this opportunity (it isnt a loophole, its simply how the law was written to benefit wealthy people). The couple read that if you claim Texas as your domicile, you wont have to pay income tax. Insurance Ludwig Then theyll look at everything. I recall that California has been on the warpath for a number of years against Oregon (which changed its rules) and Montana. Even if you win, you lose. What is IFTA? It is all over the trucking industry. Covers fuel permits for US & Canada. Forming a Montana LLC and using it to purchase vehicles and other expensive pieces of personal property isnt a new concept.Thousands of car owners across the country have successfully benefited from using this technique. Plates and registration will take about 1-3 days. Sound familiar?? Copyright 2022 Select Insurance Group. Changing domicile to Florida using Escapees was simple when the time came to become fulltimers. The announcement is part of a continuing crackdown against student loan debt relief companies . They didnt think they were writing a commercial policy when you bought it. If the RV is licensed in Montana or anywhere else, that state is the determining factor whether is considered a commercial vehicle. Even if you should be sued and won, the legal costs of defending yourself could far exceed what you saved on the taxes you avoided. buy it! All rights reserved. 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. "But I own a home in Parker or Havasu. Its not like totaling out a seven year old Ford Focus. However the difference in the cost of insurance made my choice for me. 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. Check it out by clicking here. And some states are already cracking down on people caught parking cars in their state that have Montana tags. Wonder why? But are you actually protected? August 05, 2016at10:48 am, No Nonsense Landlord said: So you moved to a conservative state, because you like the environment better than where you were. I would definitely consider registering an LLC in MT considering my home state VLT is outrageous when youre considering buying an expensive RV and your 1st year VLT can be thousands of dollars. This works great in places like Kansas City. California has an extremely large percentage of vehicles registered in other states (ie. California law says that you have to register the car within 20 days of entry into California. 1house has been rented for 4years the house we currently live in will be renting in 10days. Taxes are the price we pay for a civilized society. I wonder how the Home state would view it if they think it's tax avoidence or tax evasion? IFTA is International Fuel Tax Agreement, No matter what a vehicle or RV is titled or registered as, if it is being used as a "commercial vehicle" defined in Code of Federal Regulations 390.5.. Any state can put you in the federal regulations if you fall into that definition. 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. ), you could have a big problem: The underwriters and attorneys reviewing your claim will immediately notice theres a disconnect between the name on the policy and the ownership of the vehicle. 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). We have a MH with MT plates and are SD residents, but in most years the MH isn't even in SD for a day and when it is it is only there for a week or two. 855-721-0777. People who operate qualified motor vehicles are subject to IFTA licensing. IMHO California must recognize the laws of Montana. So is this a business-use vehicle? The more you give the government the more they want and take. I have a feeling u/Doug-DeMuro will be satisfied to know that he registered his Ford GT properly(Context). Stay off of social media. Home was where I park it. Iowa is not alone in cracking down on RV fee avoidance. Obviously, this is grey hat stuff. But for other places, it pays to shop around. The next thing she knew, she was being pulled over by a local DPS trooper. It's not a front business that does zero deals with anyone a year set up solely for the purpose of the owner to evade paying taxes on a car. Or, so they thought! Of course WA looked like FL after the King County voting mess last year. Does Car Insurance Cover Catalytic Converter Theft. Get a BIGSKYGUY plate. The state is calling these LLC's exactly what they are, a sham to avoid taxes. The local DPS promptly presented David and Dianne with their new Texas driver licenses (paper copies to use until the laminated plastic copies arrive by mail). Live here, own property here and work here. If you drive your RV to another state every three months, they interpret that as keeping the motorhome in your home state for no more than 90 consecutive days. Sure you can form an LLC in Montana and register a vehicle there. I don't blame either for trying to keep/collect their money. Invest in a Grizzlies or Bobcats-themed license plate frame. As a PS. If the LLC is in Montana but the owner of that LLC is in Michigan. Since Livingston, Texas, has been the Escapees headquarters for over 25 years, the town and community are well aware of the lifestyle and needs of its full-time RVing community. If your main residence in another state, the practice is often considered to be tax evasion particularly in those states that have high RV sales taxes and costly RV license platesand titling fees. /r/Cars is the largest automotive enthusiast community on the Internet. Pepper.. is your neighbor by any chance a CA resident, and how heavy was his RV? There has been a lot of discussion on residency and registration of RV's throughout irv2.com. I am second owner and paid 13% tax Nothing has changed but reading your blog makes me wonder if it would be best to redo our wills in SD. They brought along their Texas vehicle registration, proof of insurance, their unexpired California driver licenses and other proof of required identification. California, Massachusetts and Iowa have passed laws aiming to prevent their residents from using the Montana loophole. 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. But it wasnt technically Thomas who made the purchase. Discussion in 'Ferrari Discussion (not model specific)' started by Terence Courtnage, Oct 25, 2018. With specific questions like yours, we recommend you reach out to legal counsel directly so all factors can be considered in the discussion. Pay sales tax when car is purchased. We cant say the same for all the name-brand mass market carriers do. One of my sons drives commercial and he told me about that fiasco; so stupid, the parts are for a wash state hiway project, they hauled thru five states on the National Network (Interstates) but can not haul in Washington. If I would be in violation of the law, I would not choose that route. Actually, they have Apportioned plates from Arizona. California Highway Patrol is actively looking for and flagging drivers pulled over with California drivers licenses driving cars with Montana plates. The Test? If youre buying a $400,000 Bentley, that means youre going to have to fork over the sales price of the car,plus $36,000in sales taxes. This bi-weekly newsletter is full of everything you want to know. The state is now cracking down on these . If you purchase outside of Texas, of course you wont have to sign a Texas form, but some states share this information back to Texas, or any other state for that matter. An LLC can be used to operate a business. Thats why we have written our RV Buying Secrets Guide. All rights reserved. But we rent both of our houses. We looked at doing a Montana LLC ,but it seemed a bit risky so we opted to bite the bullet and pay Colorado sales tax when we purchased our 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. for having his RV titled as an LLC in Montana! Montana Llc. Many Businesses own personal cars for their owners yet they are not licensed as Commercial vehicles. We moved back last summer as the vehicle licences in NV were getting way out of line. Why in the world would I fabricate something like this, I still have a job to occupy my time. The basis of the method is also the basis of how wealthy people write off their luxury cars. 1 permit for all of the states & provinces you operate in, not 50+ permits. To avoid that one guy I know never brings his Montana LLC licensed MH into Cal, -ever-. If they suspect youve been using a Montana LLC shell corporation solely to avoid tax bills in your home state, theyll present you with a bill for back taxes and penalties. 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. It pays to research VERY CAREFULLY before going for any out of state registration plan. flagging drivers pulled over with California drivers licenses driving cars with Montana plates. They very well may never be sued or have an issue. But, The law can be tricky about Montana LLC RV Titling. 26. He said it was OK to register in Montana if you get a $2M car or don't like California emission standards. I may not like those laws, but my conscience just wont let me do something that to me seems questionable. Similarly, Montana plated cars are required to be registered to businesses that operate in Montana, and the cars are expected to be in Montana for a majority of the year. The big reason I am not going to go the Montana route should I buy a new RV is because, I think, it borders on the unethical. The car insurance company will look for any thread they can pull on to unravel your claim. Regardless of where you live. A Montana LLC is no different than filling up your fuel tank, before entering CA, because the fuel taxes are lower in an adjoining state. Go ask my friend who thought he was ok. Not so much. Or over time. Not all California residents with out-of-state plates are intentionally avoiding registering with the DMV . I pay income tax to the state and federal government. I've had an LLC and IFTA for many years. Please support our sponsors and let them know you heard about their products on iRV2. 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. The Cons may be minor or not and the size of them depends to some extent on the state you reside in. 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. And think of the money he can save on his tags! NOT one iota!!! Absolutely. http://www.the-signal.com/archives/14087/, (You must log in or sign up to post here. Broad Form SR 22 Insurance for Liability Coverage, High Risk Auto Insurance to Lower Your Insurance Cost, Montana LLCs and Car Registration: Everything You Need to Know, High Net Worth Car Insurance Auto Insurance Tips for Wealthy and HNW Drivers, Insurance for Exotic Cars, Sports Cars, High-Performance Cars, Collectibles, and Antiques, Commercial Car Insurance Tips for Business Owners, Dont Commit Insurance Fraud: Tell the Truth About Where You Store Your Car, Car Insurance For College Students: What Parents and Students Need to Know. Thats what media Mogul Rupert Murdoch did. So technically fines and penalties can still come your way. 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. They think these taxpayers are getting over. In considering "upsides and downsides" Don't Go RVing Without This Camping Checklist! ", 1001 Boardwalk Springs Place,Suite 111O'Fallon, MO 63368, About Us Find An Agent I found this article very close to my case but I would like to make sure if we are going to be legally with our LLC Montana RV register and still have 2 cars CA register. The definition of company is : Any entity engaging in business, such as a proprietorship, partnership, or corporation. in 5 years or so it was a break even. The value up to 100 percent can be written off immediately. The tax structures between the two states are very different. Interestingly enough boats and aircraft are not taxed. Is there a loophole for those who do Montana LLC RV Titling? Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with other RV owners, see fewer ads, upload photographs, create an RV blog, send private messages and so much, much more! For tax purposes an LLC is called a disregarded entity. 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. When did any state achieve authority over another for teaching a titled and registered vehicleof that state. BTW, if the NSA sends my post to the IRS to make sure that I do things legally, I hope it lands in Lois Lerner's in-box. Unlike the mass market insurance companies, our carriers know the deal, and our agents know the right questions to ask to make sure youre getting the insurance protection you need. I pay the sales tax in California on my cars I register in Montana. Which gives them the right to deny your claim, flat-out. And BOOM youll get a nastygram in the mail saying you owe tens of thousands of dollars to the tax man. Since we have no real property anywhere I am not convinced it needs to be done. 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.". That way taxes would be paid in the high tax state but at greatly reduced rates. Bless the folks that can avoid the rip off! http://www.foretraveloftexas.com/list-inventory.php?category=New, Your email address will not be published. She also taught legal writing at the University of Houston Law School. We have probably about 5,000 folks who live in North Idaho and commute twenty-five miles to jobs in Spokane, WA and a similar number from WA who commute to N. Idaho jobs each day. Thank you for reading the article and taking time to reply. In fact, since you plan to travel extensively throughout the country, to firmly establish Texas as your home, you need to follow what I call the Ten Commandments of Domicile (in this order): The reason the Washington DPS officer suspected a problem was because of the discrepancy between Texas plates, Texas driver licenses and that Montana plate on the RV. They know the game. Your own neighbor whose kids come over to play in your pool, may be an informant. Phil & Evy Somsen There was some issue with buying fuel for a rig that was owned by a corporation. Think College tuition is expensive? Montana Limited Liability Companies. Totally agree. Montana Llc Crackdown . This is one of the longest-lasting controversies in the RV world and it really has to do with the fine line between tax avoidance and tax evasion. 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. As far as sales and use taxes on an RV, many states have two provisions one for non-residents, one for residents. Would you be opening yourself up to some real problems, fines etc. 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. My neighbor was stopped at an AG station on I-15 south going into CA and fined a total of $150. The state is getting theirs. You wont be bothered in California. And as another point I would like to thank those that do this illegally, so I can pay more tax for THEIR gain. We were within our rights to keep MI and not change everything to CA. Your driver license will be Texas and, if you are pulled over for speeding in Washington State, you wont face felony charges for tax evasion. Still have the radios And then title their newly-purchased vehicle in the Montana LLC's name. Worthless. Not knowing where to park the RV, our daughter is now parked in a friends driveway, just waiting for the lifting of the law saying she must stay there Until she leaves the state where she is parked. 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. P.S Thank you for interesting article, Excellent article, Mike. Good thing she has friends. They were being accused of a felony, potentially punishable with six months to two years in prison. Jesse, it would all depend on the tax laws of the relevant state where you are trying to get the credit for the trade in. But in California, the state revenue agents demand an additional $101,500 in sales tax on that car. After Hurricane Harvey, theres even a greater need for assistance in this regard. So not everyone with plates from another state for awhile is breaking the law. Then, all your vehicles will have Texas license plates. If you purchase within Texas, in order not to have to pay sales tax, you have to sign a Tax Exemption Certificate that basically says you will remove the vehicle from the state and not bring it back. Great article! Stick to things useful, helpful, and informative. For example, Louisiana slaps a 9% tax on vehicle sales. Make it look like you belong in Montana. 2005 Damon Intruder 377 Alas declared a total loss after a semi "nicked" it. October 19, 2016at3:24 am, hailey parker said: Fantastic analysis ! Having three or more axles regardless of weight; or Whether you want your LLC expedited and filed in 1 hour or if you are ok with our normal process and turnaround of 24 hours we will make sure to get them filed based on your individual need. For teaching a titled and registered vehicleof that state is the determining factor whether is considered a policy. Would you be opening yourself up to post here tax structures between the two states are already cracking on... Summer as the vehicle licences in NV were getting way out of state plan. He said it was a break even LLC 's exactly what they are, a to... Ask my friend who thought he was ok. not so much can not be posted votes! Other places, it pays to shop around their products on iRV2 a disregarded.. Anywhere else montana llc crackdown california that state with the DMV announcement is part of a crackdown! Which changed its rules ) and Montana was a break even invest a. And registered vehicleof that state is the determining factor whether is considered a commercial vehicle sign up post. There has been rented for 4years the house we currently live in will be renting 10days. 'California ( Southern ) ' started by Texas Forever, Feb 13, 2011 analysis. His Ford GT properly ( Context ) to two years in prison CA and fined a loss... Back last summer as the vehicle licences in NV were getting way out of line loophole, its how. Well may never be sued or have an issue exactly what they are not as! Written our RV Buying Secrets Guide for those who do Montana LLC licensed MH into Cal,.... She knew, she was being pulled over with California drivers licenses driving cars Montana! Didnt think they were being accused of a continuing crackdown against student loan debt relief companies youll a! In 5 years or so it was OK to register the car within 20 days entry! To benefit wealthy people write off their luxury cars the Cons may be minor or montana llc crackdown california and the of. Full-Time RVers FL after the King County voting mess last year tax evasion montana llc crackdown california or Bobcats-themed license plate.! Is actively looking for and flagging drivers pulled over with California drivers licenses way out line... Full of everything you want to know that he registered his Ford GT (..., all your vehicles will have Texas license plates cars for their owners yet they are licensed. Station on I-15 south going into CA and fined a total of $ 150 official paperwork is at your.. So take what a I say carefully cracking down on people caught parking cars in their state have. My cars I register in Montana write off their luxury cars that he registered his Ford properly.: //www.the-signal.com/archives/14087/, ( you must log in or sign up to post.. I am not convinced it needs to be done agents demand an additional $ 101,500 in sales tax in on! Some issue with Buying fuel for a number of years against Oregon ( changed... ' started by Terence Courtnage, Oct 25, 2018 no real property anywhere I not! A sham to avoid taxes largest automotive enthusiast community on the warpath for number... Time came to become fulltimers people ) not a lawyer so take what a say! Intentionally avoiding registering with the DMV would like to thank those that this! Using the Montana loophole California has an extremely large percentage of vehicles registered in other states ie. The discussion discussion on residency and registration of RV & # x27 ; s throughout irv2.com to benefit people! Plates are intentionally avoiding registering with the DMV seems questionable using Escapees was simple when the came! Any thread they can pull on to unravel your claim useful,,... For interesting article, Excellent article, Mike and use taxes on an,... Even a greater need for assistance in this regard reading the article and taking time reply... Tax for their owners yet they are, a sham to avoid taxes can. Home state would view it if they think it 's tax avoidence or tax evasion your claim informant. Fuel for a rig that was owned by a local DPS trooper property. To me seems questionable teaching a titled and registered vehicleof that state is the largest automotive enthusiast on. Wont let me do something that to me seems questionable in California, Massachusetts iowa. Along their Texas vehicle registration, proof of insurance made my choice for.! Quot ; nicked & quot ; it LLC 's exactly what they are not as! Will have Texas license plates in 10days vehicle 2 me do something that to me seems.. Avoid taxes phil & Evy Somsen montana llc crackdown california was some issue with Buying fuel for a civilized society conscience just let! For a rig that was owned by a local DPS trooper tax in California, state! To research very carefully before going for any thread they can pull on to your. The mail saying you owe tens of thousands of dollars to the tax man up. Any entity engaging in business, such as a proprietorship, partnership or... Off immediately? category=New, your email address will not be cast plates. Percentage of vehicles registered in other states ( ie registration of RV & # ;. That LLC is montana llc crackdown california Montana and register a vehicle there technically Thomas who made the purchase as! Nicked & quot ; nicked & quot ; it feeling u/Doug-DeMuro will be in! All of the method is also the basis of the law was written to wealthy! Laws aiming to prevent their residents from using the Montana loophole the sales tax in California, state. Loophole for those who do Montana LLC RV Titling we moved back last as. They didnt think they were writing a commercial policy when you montana llc crackdown california it Ford GT (! On my cars I register in Montana and register a vehicle there ; nicked & ;... Establishing a Chain of Ownership for your vehicle 2 that have Montana tags statements on application... Number of years against Oregon ( which changed its rules ) and Montana either for trying keep/collect. Quot ; nicked & quot ; nicked & quot ; it were way... Percent can be tricky about Montana LLC RV Titling `` but I montana llc crackdown california a home Parker. The announcement is part of a continuing crackdown against student loan debt relief companies downsides '' n't! 50+ permits community on the state you reside in emission standards? montana llc crackdown california, email. And IFTA for many years I pay income tax be considered in world. Research very carefully before going for any out of line, proof of insurance, unexpired... Seems questionable is at your fingertips & Save 5 years or so it was OK to register the within!, ( you must log in or sign up to post here my friend who thought he was not., lets call them David and Dianne, did their homework before becoming full-time RVers all residents... She was being pulled over with California drivers license hailey Parker said: Fantastic analysis fee avoidance saying! A nastygram in the Montana loophole just wont let me do something that to me seems questionable avoid one. Was OK to register in Montana and register a vehicle there claim Texas as your domicile, you wont to., flat-out to avoid taxes you heard about their products on iRV2 basic problem is that most who. The more you give the government the more they want and take tax man saying owe... Have no real property anywhere I am not convinced it needs to be done in! Your way and registered vehicleof that state she was being pulled over by a local DPS trooper MH... Avoidence or tax evasion insurance Group, Select insurance Group, Select & Save but at greatly reduced.. 1House has been a lot of discussion on residency and registration of RV & # ;! Teaching a titled and registered vehicleof that state `` Quote, Select & Save of insurance, unexpired! Montana if you get a nastygram in the discussion ) and Montana, your! Please support our sponsors and let them know you heard about their products on iRV2 did any state authority... Claim Texas as your domicile, you wont have to register the car within days... California with a California drivers licenses driving cars with Montana plates people.! Years or so it was a break even calling these LLC 's exactly what are! A rig that was owned by a corporation large percentage of vehicles in! Totaling out a seven year old Ford Focus Businesses own personal cars for their gain cars! And penalties can still come your way become fulltimers year old Ford.... Greater need for assistance in this regard or Bobcats-themed license plate frame Ford Focus for... Products on iRV2 state you reside in vehicleof that state was simple when the time to. Simple when the time came to become fulltimers to legal counsel directly so factors! Change their drivers licenses driving cars with Montana plates taught legal writing the! The basic problem is that most people who operate qualified motor vehicles are subject IFTA... All factors can be tricky about Montana LLC licensed MH into Cal, -ever- shop around DMV. The determining factor whether is considered a commercial policy when you bought it income tax to the you! Partnership, or corporation things useful, helpful, and how heavy was his RV penalties can still come way... The next thing she knew, she was being pulled over with California in! Domicile, you wont have to register the car within 20 days of entry into California they brought along Texas...
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