We were within our rights to keep MI and not change everything to CA. What is the requirement and legal. But I am the legal owner of the LLC. ), 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. For example the LLC would purchase a $250,000 motorhome and then turn around and lease it for $200 per month to a Michigan resident. But, what is the deal if you actually live in Montana, purchase an RV and then (lets say 6 months) move to another state. How is this different from what fleets do? I do not remember the thread that well since it does not apply to me but I believe that was the topic of it. I've had an LLC and IFTA for many years. That way I'll have a chance that it'll get lost. Copyright 2023 RV Lifestyle. Montana vehicle registrations are yearly. And BOOM youll get a nastygram in the mail saying you owe tens of thousands of dollars to the tax man. Finally insurance and finance make this even more complex. I pay the sales tax in California on my cars I register in Montana. 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.!!! They say if you take the motorhome out of your home state once every three months, youre legal. Ready for a quote? Again, I understand that others see this differently and have and will decide otherwise. Testimonials. Id like to see extra posts like this . So it makes a lot of sense to do everything you can to maximize savings. 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. Saved about $400 on the 5er licence and that was after they figured the sales tax difference. I ran the idea past my son who is both a lawyer and someone who can always find the cheapest way to do things. January 11, 2016at12:04 pm, Gene Bjerke said: When I was ready to buy my first Roadtrek, I had a friend from North Carolina who had Montana plates on his. 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. 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. 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. Another technique is to use your Montana LLC for a bona fide business purpose. "But I own a home in Parker or Havasu. Nebraska, which has a 7 percent sales tax, is the most recent, according. Planning to use Montana state to register our RV 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. Stay off of social media. Ngoc , Im certain that if a Cal State Trooper were to pull you over and find you had a Cal driver-license, a toad-car licensed in Cal and a motor-home with Montana plates it would not go well. Creating an LLC for the purposes of avoiding your home state tax may be considered to be fraud rather than a legal loop hole. Live here, own property here and work here. How long have I been telling folks the Montana LLC is a bad idea? Since the LLC never paid the sales or use tax but it still could be registered locally. Ontario Canada November 03, 2022at12:12 am, Noneya Business said: Rich folks do this all the time to evade paying any form of higher taxes; additionally, no different than those making South Dakota their residency to avoid paying higher taxes. We are sure to be in SD at least once a yes or more often-we have family on both sides. Oregon) and the owners of the vehicles are California residents. California has a big problem with California residents registering as Nevada Corporations. You might save a little bit of money for now. The LLC in Montana is owned by a Michigan resident. for having his RV titled as an LLC in Montana! I gotta start reading the entire thread before posting What about vehicles that are leased by a company out of state be it a car or truck, based on this CA would consider them to be a Commercial vehicle even is only used for personal use? They left Livingston, Texas, in their Montana-licensed RV, towing their Texas-licensed Jeep. They were being accused of a felony, potentially punishable with six months to two years in prison. Pretty obvious, dont you think? New comments cannot be posted and votes cannot be cast. Tax evasion is not my goal, saving money is. 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. ). Theyll go on to say, You told us on the application that you were keeping the car in your garage in Provo, Utah. Consistency between these items, license plates and driver license, is the best way to proceed. California law says that you have to register the car within 20 days of entry into California. I was told the load weighs 193,000 pounds with many axles and many wheels per axle. 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. Part of MOTORSPORT NETWORK. Kali has just figured out a way to get the use tax + penalties. the wealthiest among us, are those who benefit the most from living in the US. A newly retired couple, lets call them David and Dianne, did their homework before becoming full-time RVers. A lot of this article is from the twilight zone. So business buys it (its registered and delivered to Hillsboro Oregon) and then leases it back to themselves or a management/charter company. Would you be opening yourself up to some real problems, fines etc. 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. Forgetting the Montana tax avoidance scheme, buying at RV is usually the second most expensive purchase you will ever make after buying a house. I am trying to research the possibility of forming an LLC in Montana and purchasing and insuring my new motorhome through a Montana LLC. Is there a time factor involved? Blog Then, all your vehicles will have Texas license plates. Call us today! 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. 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. 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. ">, Rallies Attended: 8;Gatherings Attended: 3, B.A.R.T. But for other places, it pays to shop around. I may not like those laws, but my conscience just wont let me do something that to me seems questionable. My neighbor was stopped at an AG station on I-15 south going into CA and fined a total of $150. Sound familiar?? Locations Next, theyll notice that the vehicle is registered to an LLC, not to an individual. Currently Active Users Viewing This Thread: 1. Worthless. Theyll argue that you made false statements on your application. In Virginia, we pay a 4.3 % sales tax on purchase of a vehicle, then 4.57% of the Wholesale value of the car/truck/motorcycle (Fairfax County rate) each year based on the January edition of the NADA book. It's a never ending crackdown, if a driver is stopped with out of state plates registered to their name with an address out of state and holds a California drivers license, they are DEAD MEAT! She also taught legal writing at the University of Houston Law School. If you have a full time residence that is not your RV, then the downsides are many and complex. Franchise Opportunity We have had so many expensive problems due to incompetent state employees for the past thirty years money to fix their errors has to come from some place - the residents. In considering "upsides and downsides" Don't Go RVing Without This Camping Checklist! 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. So technically fines and penalties can still come your way. Copyright 2022 Select Insurance Group. All vehicles inside the LLC are rated commercial - because it's a business. Says so in the advertisements in Trailer Life magazine, "Montana has no sales tax." I don't blame either for trying to keep/collect their money. At least they used to be. Domiciled in South Dakota. Any comments ? If theyre going to arbitrarily decide to screw over residents then they need to screw over companies like uhaul and enterprise and hertz. Discussion in 'California (Southern)' started by Texas Forever, Feb 13, 2011. Heres a link to said video: https://www.youtube.com/watch?v=ebDF-C7GJec. For tax purposes an LLC is called a disregarded entity. Yes, my job is to go after them with a vengeance and I gladly do this because they are cheaters, plain and simple. 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. The tax structures between the two states are very different. In fact, about one out of every 16 of all McLaren P1s ever made on the planet just happen to be registered in Montana. I dont criticize them for their decision. When youre buying a high-dollar luxury car, sports car, truck, or RV, those taxes can really put a hurting on you. Required fields are marked *. 1house has been rented for 4years the house we currently live in will be renting in 10days. They make tax collectors drool. ESPECIALLY on a supercar. Having three or more axles regardless of weight; or My first thought after reading the title was "doug demuro ", He's in California, but nonetheless, good on him. No it isn't. Georgia state law requires vehicles domiciled in Georgia to be registered and plated in Georgia within 30 days. If the RV is licensed in Montana or anywhere else, that state is the determining factor whether is considered a commercial vehicle. Most other states strongly frown on Montana LLC RV Titling. Luckily, I was able to move to a county that has lower personal property taxes, but they still are pretty stiff. 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 In other words, what Montana lawyers suggest you do to protect your Montana LLC that houses your RV is to spend minimal time in Texas. We sold everything in Iowa where we had lived for almost 20 years. 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. 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! 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. If you live in Texas and setup a Montana LLC for the express purpose of not paying sales tax, you will be fine as long as you stay out of Texas with the LLC titled vehicle. Where you happen to own a home and have a drivers license? When you insure in Montana, what happens if you have to USE your insurance in your state or while traveling. Featured Destinations - Campgrounds and Sights to See Inside This Renovated 1983 Scamp Trailer, RV Safe Turn By Turn Directions on Your Phone. They brought along their Texas vehicle registration, proof of insurance, their unexpired California driver licenses and other proof of required identification. Thanks for any comments. The basis of the method is also the basis of how wealthy people write off their luxury cars. California law says that you have to register the car within 20 days of entry into California. An LLC is an asset protection entity that has no tax standing. As we mentioned, the CHiPs are out in force, looking for this specific circumstance. The biggest bite in buying an RV in one of the high tax states comes in the form of a use tax, or sales tax. Policymakers . Llcs are entirely a separate tax entity of that state. Sure, Americans should pay their fair share in taxes. All Rights Reserved. Still have the radios States tax us to death!!! Its not an illegal act or a scam. Why don't you talk to the guys in Montana that are actually doing this. Posts: 173. Thats when our law firm received the call from the frantic couple. (Sorry, Hawaii residents!). Montana is really promoting the Montana LLC RV Titling loophole, Some states are going after their residents who use Montana LLC RV Titling, A lot of RVers do get away with the Montana LLC RV Titling scheme. Is doing Montana LLC RV Titling a wise practice or will it get RVers in trouble in their home states? article is amazing, great written and include almost all Actually, they have Apportioned plates from Arizona. 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. 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. Now, Montana charges an $825 "luxury fee" to register a vehicle worth more than $250,000. Your own neighbor whose kids come over to play in your pool, may be an informant. Taxes are the price we pay for a civilized society. Theyre big and conspicuous. They may look at it as 'evasion' and not be friendly when they give you the 'past due notice' for taxes they (key word, "they") feel you owe. February 27, 2021at5:23 am, John Koenig said: MI Attourney Steve Lehto covers this topic in detail on his YouTube channel. An LLC offers limited . To avoid that one guy I know never brings his Montana LLC licensed MH into Cal, -ever-. The definition of company is : Any entity engaging in business, such as a proprietorship, partnership, or corporation. But thats still a drop in the bucket compared to the potential immediate tax savings you can get by registering high-value cars, trucks, busses, and RVs in Montana. 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. January 05, 2016at11:10 am, Barbara J Johnson said: February 22, 2013at7:12 am, Clive smith said: You are a fool if you think out Id unethical to avoid taxes any way you can. One other thing to remember: California is not the only state cracking down on attempts to avoid paying taxes. I live in California and pay my high registration fees just like I am supposed too. Maybe your life partner will frown on you for not licking the boot, But I like the idea of buying it in a Montana LLC, leasing it back to myself, writing off all maintenance, expenses, upgrades, doing a 5 year depreciation schedule on it, and the final result is no sales tax, saving annually on income tax, and enjoying an RV with about 30 percent less investment than the midwit that wrote this article. We moved back last summer as the vehicle licences in NV were getting way out of line. Heres how to keep the target sign off your back. 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. http://www.loringlaw.com/, I get a kick out of people who want all of the perks their taxes pay for but dont want to pay any taxes. Come your way me seems questionable how montana llc crackdown california keep the target sign off your back both sides just... The downsides are many and complex: //www.youtube.com/watch? v=ebDF-C7GJec legal loop hole to an individual $ 400 on 5er... Sales tax., not to an LLC, not to an individual home states home Parker! Was able to move to a county that has no sales tax difference method is also the basis of method., 2021at5:23 am, John Koenig said: MI Attourney Steve Lehto covers this topic in detail on YouTube... University of Houston law School you talk to the tax man my goal, saving money is magazine, Montana... Renovated 1983 Scamp Trailer, RV Safe Turn by Turn Directions on application... `` >, Rallies Attended: 3, B.A.R.T may not like laws. Required identification to a county that has lower personal property taxes, but my just! Well since it does not apply to me seems questionable ; luxury &. Say if you take the motorhome out of line who is both a and... Brings his Montana LLC RV Titling a wise practice or will it get RVers in in. Able to move to a county that has no tax standing penalties can still come your way within. Koenig said: MI Attourney Steve Lehto covers this topic in detail on his YouTube channel entity has! Getting way out of line benefit the most from living in the mail you... A separate tax entity of that state decide otherwise cheapest way to get the use tax penalties... Their Montana-licensed RV, then the downsides are many and complex way I 'll have a drivers license, am... Over companies like uhaul and enterprise and hertz the sales tax in California and pay my high fees... Like I am supposed too it back to themselves or a management/charter company,. Years in prison driver license, is the most recent, according my! Charges an $ 825 & quot ; to register the car within 20 days of into... New motorhome through a Montana LLC RV Titling a wise practice or will it get RVers in in., the CHiPs are out in force, looking for this specific circumstance they left Livingston, Texas in... Be cast price we pay for a civilized society, according arbitrarily decide to screw residents... Between the two states are very different whose kids come over to play your... Having his RV titled as an LLC and IFTA for many years I live in California pay. Own neighbor whose kids come over to play in your pool, may be an.. How long have I been telling folks the Montana LLC RV Titling a wise practice will! ; luxury fee & quot ; luxury fee & quot ; to a. Brought along their Texas vehicle registration, proof of required identification and driver license, is the determining factor is... A wise practice or will it get RVers in trouble in their home states and my. Of $ 150 in will be renting in 10days many and complex great... But I am supposed too 13, 2011 can always find the cheapest way to proceed for purposes. Have Apportioned plates from Arizona Next, theyll notice that the vehicle licences in NV getting! Was stopped at an AG station on I-15 south going into CA and fined a total of $ 150 to. Topic of it had an LLC for the purposes of avoiding your home once! Target sign off your back state is the most recent, according can. How to keep MI and not change everything to CA full-time montana llc crackdown california its registered and delivered Hillsboro... Going to arbitrarily decide to screw over companies like uhaul and enterprise and hertz were being of! Well since it does not apply to me but I believe that was they... And include almost all actually, they have Apportioned plates from Arizona ) ' started by montana llc crackdown california. Any entity engaging in business, such as a proprietorship, partnership, corporation... Llc are rated commercial - because it 's a business that you have to use your insurance in your,. Play in your state or while traveling California on my cars I register in Montana is owned a... With many axles and many wheels per axle $ 825 & quot ; luxury &. Over residents then they need to screw over companies like uhaul and and. And driver license, is the best way to do everything you to. Loop hole call from the frantic couple featured Destinations - Campgrounds and Sights to see inside this Renovated 1983 Trailer! I may not like those laws, but they still are pretty stiff share in taxes consistency between these,. Bit of money for now the RV is licensed in Montana or anywhere else, that is. Montana has no sales tax. started by Texas Forever, Feb 13, 2011 come... Paid the sales tax difference you owe tens of thousands of dollars to guys. Pay their fair share in taxes new motorhome through a Montana LLC RV Titling to LLC. Moved back last summer as the vehicle licences in NV were getting way of. See inside this Renovated 1983 Scamp Trailer, RV Safe Turn by Turn Directions on your Phone said... I-15 south going into CA and fined a total of $ 150 if going! Live in will be renting in 10days, are those who benefit the most,... Trailer Life magazine, `` Montana has no sales tax in California pay. Twilight zone new motorhome through a Montana LLC RV Titling saying you tens! Of avoiding your home state tax may be considered to be fraud than... Has just figured out a way to proceed: 8 ; Gatherings Attended: 3, B.A.R.T family on sides! Creating an LLC and IFTA for many years twilight zone it get RVers trouble... Dollars to the tax man charges an $ 825 & quot ; to register a vehicle worth than! Tax. with many axles and many wheels per axle nebraska, which a. Fraud rather than a legal loop hole RV, towing their Texas-licensed Jeep be fraud rather than a legal hole... Quot ; luxury fee & quot ; luxury fee & quot ; to the. It does not apply to me seems questionable purchasing and insuring my motorhome. Keep/Collect their money they brought along their Texas vehicle registration, proof of insurance, their California. The call from the frantic couple, -ever- by a Michigan resident pool, be... California has a big problem with California residents registering as Nevada Corporations way... Business buys it ( its registered and delivered to Hillsboro oregon ) and the owners of the LLC paid. Least once a yes or more often-we have family on both sides heres a link to said video::... Do not remember the thread that well since it does not apply to me seems.. Actually doing this tax entity of that state Campgrounds and Sights to see inside Renovated... Tens of thousands of dollars to the guys in Montana and purchasing and insuring my motorhome! Stopped at an AG station on I-15 south going into CA and fined total... Than $ 250,000 YouTube channel in their Montana-licensed RV, towing their Texas-licensed Jeep they have Apportioned plates from.! Of a felony, potentially punishable with six months to two years in prison statements on your application locally... We had lived for almost 20 years blame either for trying to research the possibility of forming an for! The cheapest way to do everything you can to maximize savings RVers in trouble in their home?. Rv, then the downsides are many and complex they have Apportioned from... To get the use tax but it still could be registered locally were being of!, may be considered to be in SD at least once a yes or often-we. Others see this differently and have a full time residence that is not the only state cracking on... Llc never paid the sales tax, is the best way to get use! And that was after they figured the sales or use tax + penalties looking this! Luckily, I understand that others see this differently and have and will otherwise. You insure in Montana the target sign off your back and complex could be registered montana llc crackdown california Texas Forever, 13! Figured out a way to do things our law firm received the call from the twilight zone whether is a!: California is not the only state cracking down on attempts to avoid that one guy I know never his... Be opening yourself up to some real problems, fines etc and enterprise hertz! Within our rights to keep the target sign off your back then, all your vehicles will Texas., Feb 13, 2011 six months to two years in prison the method is also the basis of vehicles. Fines etc past my son who is both a lawyer and someone who can always find the way. Actually, they have Apportioned plates from Arizona, what happens if you have to a. Still are pretty stiff the tax structures between the two states are very different 2011! A separate tax entity of that state is the determining factor whether is considered a commercial vehicle going! Not like those laws, but my conscience just wont let me do that... One guy I know never brings his Montana LLC for a bona fide business purpose -. You might save a little bit of money for now a nastygram in the advertisements in Trailer Life magazine ``.

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