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Old 06-28-2013, 01:54 PM   #43
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Not to pick nits, but I believe that LLC stands for Limited Liability Company... and I've been told that a company isn't necessarily a business.

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LLC defined per one online legal dictionary:

Quote:
A noncorporate business whose owners actively participate in the organization's management and are protected against personal liability for the organization's debts and obligations.

The limited liability company (LLC) is a hybrid legal entity that has both the characteristics of a corporation and of a partnership. An LLC provides its owners with corporate-like protection against personal liability. It is, however, usually treated as a noncorporate business organization for tax purposes.
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Like a corporation, a limited liability company or "LLC", is a separate and distinct legal entity. This means that an LLC can obtain a tax identification number, open a bank account and do business, all under its own name. The primary advantage of an LLC is that its owners, known as members, have "limited liability", meaning that, under most circumstances, they are not personally liable for the debts and liabilities of the LLC. For example, if an LLC is forced into bankruptcy, then, absent special circumstances, the members will not be required to pay the LLC's debts with their own money. If the assets of the LLC are not enough to cover the debts and liabilities, the creditors generally cannot look to the members, managers or officers for recovery.


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Old 06-28-2013, 02:09 PM   #44
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I stand corrected (though years ago I'm pretty sure it was corporation - my own company was a C Corp). But I stick with the rest of what I wrote. And, of course there are no absolutes, but the odds of being caught, even due to an accident or a "nazi" neighbor, are way too high for me.

I live in a state with a high sales tax, but there's NO income tax, (and not that I would) but I could just cross the river and buy in Oregon which has NO sales tax! There's always a way to cheat. But, apparently unlike some others, I don't have problem paying my fair share. Just a problem paying more than that!
Although I can say I resent being accused of not paying my fair share of taxes, I won't get into it with you.

As we've stated in past threads on this subject, we are NOT in our home state the majority of the time. IF we were there the majority of the time, we would not have any problem registering our vehicles there.

However, we own several properties in our home state and pay heft property taxes and pay sales taxes on purchases when we are there so we pay PLENTY of taxes to our state considering we're not there much of the time.

We do the Montana thing with a clear conscience.

Again, it doesn't work for everybody. Each person has to make their own decision if it will work for them. If they can stay within the registration parameters of their own state then there's no breaking the law involved. If they can't, yes, they have to make an ethical decision as to whether it is worth "taking the chance."

We are former Washington state folks ...born and raised there. But as I've said before, if we were still WA residents, we would definitely not use a Montana LLC.
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Old 06-28-2013, 02:11 PM   #45
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This discussion brings up an interesting question in my mind.

For those who own an LLC and register your vehicles in them... are the rigs also financed in the name of the LLC? I would think this would be very tough to do.

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Old 06-28-2013, 02:20 PM   #46
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For those who own an LLC and register your vehicles in them... are the rigs also financed in the name of the LLC? I would think this would be very tough to do.

Rick
That's what struck me when I read the definitions. It appears that one could default on a vehicle loan and, if the vehicle was owned by the LLC, have no financial liability nor have the default impact the creditworthiness of the LLC member or members.

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Old 06-28-2013, 02:23 PM   #47
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Bingo!
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Old 06-28-2013, 03:21 PM   #48
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We've never financed a vehicle so personally do not know the legalities. We do know that some banks will not finance a vehicle held in an LLC. There are many Montana LLC owners who have financed their motorhomes, however. We've personally only discussed it with one couple in our state who was financing their rig and they told us that there are additional documents and legal stipulations pertaining to default that have to be agreed to.

Remember, the loan itself is based on the creditworthiness of the principal and not the LLC itself. The LLC has no credit history in and of itself. Therefore, credit is being granted to the principal (owner, in this case) of the LLC. Consequently, default would also fall back on the principal personally and not the entity of the LLC.

That's the way we understand it as it was being told to us. We have never had to deal with it ourselves.
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Old 06-28-2013, 03:30 PM   #49
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I can certainly understand why a lender would insist on a document that "pierces the corporate veil" and requires responsibility and liability from an individual. Of course, that brings up the question discussed in a previous poster's link - that being the case, and if the LLC conducts no business, then was it merely established as a "shell" company to avoid taxes? I suspect that's the question a state's taxing authorities would ask.

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Old 06-28-2013, 03:31 PM   #50
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It means nothing,

So I'm not quite sure what YOUR point is.
You got it!!
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Old 06-28-2013, 03:52 PM   #51
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You got it!!
There are lots of things posted on a message board that mean nothing. In fact, much of what people post on internet forums could be classified as such.

And you're right, it doesn't mean anything other than the majority of retired LEOs have some knowledge of the laws and also most are honest.

If it is a proven fact that the majority of LEOs are dishonest and do not obey the law, then YOU have a valid point.

I'm not sure why you feel the need to nitpick my posts but that's okay. I'm used to it.

~mandy
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Old 06-28-2013, 03:53 PM   #52
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I can certainly understand why a lender would insist on a document that "pierces the corporate veil" and requires responsibility and liability from an individual. Of course, that brings up the question discussed in a previous poster's link - that being the case, and if the LLC conducts no business, then was it merely established as a "shell" company to avoid taxes? I suspect that's the question a state's taxing authorities would ask.

Rusty
From a practical aspect an LLC is not necessarily a business. It is mostly used in a business context, but one could put their personal residence into an LLC for asset protection and preservation or any asset for that matter could be placed into an LLC. Generally LLC's are used to isolate liability. In the case of financing any asset that is in an LLC, that is accomplished quite easily. It is done in the same exact fashion as any corporation that obtains financing. All that is needed is the personal guarantee of the owner of the LLC. Bingo, the lender is covered for their risk. That is, of course, assuming that the guarantor has the assets to cover any shortfall.

Is a Montana LLC a badge of tax fraud? Not necessarily. From a practical standpoint most full timers could qualify for a Montana LLC if they met the requirements of their "tax home" state. Most of the discussions about Montana LLC's center around the legality of the LLC, but the real issue is the compliance, or lack of compliance, with the laws of the LLC owner's state of residency and the documentation of the compliance of the LLC.
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Old 06-28-2013, 04:06 PM   #53
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I can certainly understand why a lender would insist on a document that "pierces the corporate veil" and requires responsibility and liability from an individual. Of course, that brings up the question discussed in a previous poster's link - that being the case, and if the LLC conducts no business, then was it merely established as a "shell" company to avoid taxes? I suspect that's the question a state's taxing authorities would ask.

Rusty
Our LLC is not conducting business nor is it considered a "shell" company to avoid taxes.

Many corporations, for instance, register in a state that makes the most sense financially for them.

Again, we are staying within the laws of our state. If we felt that we couldn't, we would not do it. We are doing what makes the most financial sense to us. If we can do it legally and manage to save ("avoid") taxes by doing so, we will do it. If we have to break the law to save taxes, then it is of course illegal and is something we would not want to do.

And since I'm arguing with two Vancouver area residents, how many in Vancouver go to Portland and buy items to use at their residence in Washington and not voluntarily pay the Washington use tax which they are obligated to pay? I'm thinking quite a few.

Will they get caught? Probably not but in a sense, isn't it illegal?

What we are doing by registering our vehicles in a Montana LLC is not illegal.
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Old 06-28-2013, 05:47 PM   #54
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As long as Amanda is complying with the laws of her state she is totally legal and within her rights as a citizen. She is following the same path that those of us who itemize do when we deduct the sales tax or personal property tax we pay on our federal tax returns. The same goes for the interest we may pay on our "second home" which is our motorhome. It is what the law allows. No one should pay or should feel obligated to pay more than they owe for anything and that does include taxes.
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Old 06-28-2013, 06:08 PM   #55
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The States need there tax money to operate. The more tax dodgers, tax cheats that do that sort of thing makes us honest guys pay more. If you cant afford to license your moho, buy a tent
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Old 06-28-2013, 06:13 PM   #56
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Too bad we can't register and license them in Switzerland or the Caymans - but that sort of thing is reserved for the jet set - not we merry road travelers. Doesn't seem right to me.
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