Licensing your RV into a Montana LLC

[wnytaxman]

Originally Posted by twogypsies

Where the above statement came from is totally incorrect. We could name personally lots more than 20 RVers having a LLC and each has their car registered, also. Yes, there are thousands and thousands who have a LLC.

In our opinion, if you're a full-time RVer you have to register somewhere. Why not pick Montana? It's definitely legal because you don't live and/or work in another state. Full-timers register and declare their domicile in other states, too. They can do so in any state.

Full-timers are altogether different from someone who actually resides and/or works in another state. Then you have to carefully check your state's laws. A LLC will not work for everyone. Also, there's no use asking a Montana lawyer about the legality. He's not going to tell you anything about your own state you live in. You need to consult your own state lawyer.

Folks get all upset about mentioning LLC. It's perfectly o.k. for full-timers. You can't make a blanket statement that it's illegal because it's not. Where you hear of problems (& most stories are embellished and grows and grows as it's passed on) is from those actually residing in another state.

If you've never had a LLC or consulted lawyers about getting one then don't go off saying they're all illegal. Some are not.

We agree completely on those that full time and use the Montana LLC. The problem comes about with those who do NOT full time. If one has a legal residence in a state then one must comply with the laws of that state. That's the rub. I do not deny that Montana LLC's are legal. The problem comes in complying with the laws of the state in which the RV is housed.

There is a Louisiana case where the owner of the LLC avoided sales tax in Louisiana by leaving the rig in Mississippi. I would agree with the Court's decision in that case. However, what about Mississippi law? Was that vehicle now subject to sales tax in Mississippi?

[Mynticelx]

In SC, the law is written that if you operate your vehicle a cumulative 150 days in the state, then it must be registered. The kicker is the word cumulative. In states like VA, it's a consecutive 150 - which means taking a trip out of state would break the term and therefore restart the counter.. however since my state is cumulative, I would have to leave the state for half the year to truly remain legal. So, it really wasn't a good option for me.

[barmcd]

Originally Posted by jimbo2013

Dennis, best question of the thread.

First I believe it's legal in all states. there has been hearsay statements that Bennet law said this or that. I doubt he would opine on laws outside MT where he's admitted. Do do other wise may be malpractice.
Also hear say stories about others, really give us the case numbers there could have been others factors contributing to such a case.

I think all that is hogwash.

Do you think all the million/billionaires registering thousands of cars, planes and boats don't have lawyers to ask about an LLC in MT?

Now getting caught, It's very difficult to get get caught unless you don't cross your T's, but wait you can't get caught because YOU didn't do anything wrong! Right!

Anyone has the legal right to set up a LLC in MT, there's no argument there agree.

What we may be talking about is the guys that can't put there big boy pants on and just do.

If anyone approached me and asked, I would decline to respond.

Let an authority send a letter to the LLC and my attorney will respond accordingly (PS he happens to be my son)



.At this point I'll back out of this thread it's going no place.
Do as you wish

Thanks Jimbo.

[wnytaxman]

Attached is some very interesting reading from the Florida Department of Revenue regarding the sales tax on vehicles. Pay particular attention to Page 2 and what is NOT exempt from Florida Sales Tax.

http://floridarevenue.com/Forms_libr...t/gt800030.pdf

You will note that there is a LEGAL way to avoid Florida Sales Tax. I have heard full timers who have Florida residency refer to this loophole of having the rig outside of Florida for more than six months after purchase. That loophole does work.

[wnytaxman]

If you read through the Florida Sales Tax Law summary it is pretty clear that if you live in Florida and you own 10% or more of a business entity then you MUST pay the sales tax in Florida even if your business entity is not organized in the state of Florida. This isn't a matter of just "putting on your big boy pants" but a blatant disregard for the sales tax law.

I wouldn't want to see any of our fellow RVers get themselves into a tax jam by disregarding the very straight forward part of the sales tax law. Florida's statutes aren't much different than many other states. If it quacks like a duck, walks like a duck, and resides in the duck pond, the odds are pretty good it's a duck.

[nebster]

Originally Posted by wnytaxman

I wouldn't want to see any of our fellow RVers get themselves into a tax jam by disregarding the very straight forward part of the sales tax law. Florida's statutes aren't much different than many other states. If it quacks like a duck, walks like a duck, and resides in the duck pond, the odds are pretty good it's a duck.

You've somehow obfuscated the relevant Florida rules by separating the two items into different posts.

The document clarifies, at the very top of page 3, that if you are a FL resident and hold a new vehicle in a nonresident LLC, you are not subject to FL tax if the vehicle stays out of FL for six months.

In your prior post, you sussed out this rule and described it as a "loophole." The FL rule was already discussed much earlier in this thread (see my post, e.g.), and it is clearly not an ambiguity in the rules through which avoidance of something may be inadvertently attained.

There are countless other combinations of states, holding entities, and provisos with respect to vehicle location that combine to make this issue very complex. There are also cases where the rules are not explicit or clear (unlike like Florida's) but where court precedent provides some degree of clarity as to what is permissible. In this particular combination of states, entities, and timeframes, however, the rule is as black and white as they come.

[jimbo2013]

Someone in this thread or another mentioned that not that many RV's are registered in Montana.

I had to call my agent to ask a question about my plates.

So I asked how many they do she said 75-90 a week.

Now that just one agent, so I think it's reasonable to assume thousands a year are being done

[barmcd]

Originally Posted by jimbo2013

Someone in this thread or another mentioned that not that many RV's are registered in Montana.

I had to call my agent to ask a question about my plates.

So I asked how many they do she said 75-90 a week.

Now that just one agent, so I think it's reasonable to assume thousands a year are being done

That figure was mentioned in the Bozeman Daily Chronicle. I think it only pertains to high end coaches, which would be the ones that benefit the most from the LLC.

"A total of 984 luxury vehicles and 42 motor homes are now registered in Montana that would meet the age and value requirements and qualify for the tax, Justice Department spokesman Eric Sell said."

Senate panel passes 'Ferrari tax' targeting luxury cars, RVs | Montana Legislature | bozemandailychronicle.com

[mccrob]

Remember your not caught till you hear the key go klink in the door. If you get away with the gray area long enough the fine will just be a small part of the big picture

[twogypsies]

Originally Posted by barmcd

That figure was mentioned in the Bozeman Daily Chronicle. I think it only pertains to high end coaches, which would be the ones that benefit the most from the LLC.

"A total of 984 luxury vehicles and 42 motor homes are now registered in Montana that would meet the age and value requirements and qualify for the tax, Justice Department spokesman Eric Sell said."

Senate panel passes 'Ferrari tax' targeting luxury cars, RVs | Montana Legislature | bozemandailychronicle.com

Have no idea how they arrived at that figure but it's totally wrong. 42/month maybe but definitely not 42 total. Just in our small circle of full-timing friends it's close to that number.

[FlyingDiver]

That does seem low, but remember that it's only motorhomes with an MSRP of more than $150,000 AND less than three years old.

http://leg.mt.gov/bills/2017/BillPdf/HB0650.pdf, page 17.

[barmcd]

Originally Posted by twogypsies

Have no idea how they arrived at that figure but it's totally wrong. 42/month maybe but definitely not 42 total. Just in our small circle of full-timing friends it's close to that number.

It sure seems like the people who are crafting the tax bill should know how many motor homes it will affect. This is not a tax on all motor homes registered in Montana. How many of your circle of friends have a motor home three or fewer years old that had a MSRP of at least $150K?

[wnytaxman]

Originally Posted by mccrob

Remember your not caught till you hear the key go klink in the door. If you get away with the gray area long enough the fine will just be a small part of the big picture

You are correct that there is a chance you could get away with not complying with law and using a Montana LLC. However, what if you are wrong? What if you get caught and the authorities decide to make an example out of you? What if they decide to press the issue and make it a criminal case? That could very well happen. More than likely your worst case scenario is that you will pay the tax, the penalty, and the interest, but that isn't cast in stone. I have seen auditors get a bug up their posterior and go for criminal cases when at best the taxpayer's actions were only marginally across the line. States are hurting for cash and they will go to some pretty extreme lengths to obtain that cash.

Some believe that the authorities would have no recourse to collect the taxes but that is not correct. If the taxing authorities come back on the LLC they can attach any assets the LLC owns if the tax debt is not paid. That asset would be the RV. I have seen the authorities close down businesses and sell the assets to satisfy tax liens and, yes it can happen to a Montana LLC if the laws are not followed and the taxing authorities decide to push their case.

The complexities of this area are best exemplified by a state that says that if a vehicle is in the state more than 30 consecutive days then it must be registered and the taxes must be paid that are due. So, let's say that an owner of a rig that is registered in a Montana LLC says okay so I'll just go across the state line, fill up with fuel and go home. Oops, but the state says that any part of any day is considered to be one full day. Okay, so I'll overnight out of state. Again, the state says that any part of a day is a full day. So now I've got to leave the state for two full days to comply. It's not a simple area and one that requires a lot of research before jumping into the Montana LLC.

Full timers can generally use the Montana LLC without a problem. It's the non-full timers that can have a real issue.

[twojayhawks]

Originally Posted by twogypsies

Have no idea how they arrived at that figure but it's totally wrong. 42/month maybe but definitely not 42 total. Just in our small circle of full-timing friends it's close to that number.

I agree with you on this. I will also add we were at a RV resort last year and the number of Montana plates was rather noticeable. We counted about 25 just in one RV park!