Community Forums

jacks647 · 06-01-2015, 08:53 AM

Good morning, just a quick question: Has anyone used an LLC out of Montana? If so,who did you use? And, was it complicated? and, how much did it cost? I've heard when you first get it it's fairly inexpensive, however, when you go to renew it the following year it's very expensive.
Thank you, Jackie

Skip426 · 06-01-2015, 09:06 AM

LLC, has been pushed by Montana RV sales lots for years, to out of state buyers. The place where I purchased was pushing me to go that route even though it wouldn't work for Canadians who wanted to drive their RV in Canada.
LLCs do work , FOR NOW depending on your home state, cost about a grand to set up, and may require you getting a Montana drivers licence and a post office box, to establish an address there.

HOWEVER; many states are loosing tax revenue and are taking steps to close this loophole, and there are huge fines for those caught.

Lobstah · 06-01-2015, 10:37 AM

I had one, for awhile, until my wife wanted to start "work camping" in Mass, and the local news stations ran a few segments on how we were all tax cheats and destroying the economy becuase we used the same rules everyone else did.
At that time, I switched my registration to Mass, and paid my $5k in tax.

LDMcL · 06-01-2015, 10:43 AM

Quote:

Originally Posted by Skip426

......
it wouldn't work for Canadians who wanted to drive their RV in Canada.
........

Skip426

When you have a moment would you please expand on your above quote.

I have been thinking about a LLC and reading the Ontario Highway Traffic Act about what triggers obtaining an Ontario license for the LLC motorhome.

You seem to be farther along in the learning curve than I am and was wondering the basis of your statement.

Thanks:

wnytaxman · 06-01-2015, 11:31 AM

Quote:

Originally Posted by jacks647

Good morning, just a quick question: Has anyone used an LLC out of Montana? If so,who did you use? And, was it complicated? and, how much did it cost? I've heard when you first get it it's fairly inexpensive, however, when you go to renew it the following year it's very expensive.
Thank you, Jackie

The attorneys will have believe that setting up the Montana LLC is just a simple matter of filling out some forms. It is hardly that simple. There are a lot of questions you need to answer to see if you can use the Montana LLC. First off, will you be full timing? If so, then the Montana LLC may be useful and may save you a substantial amount of money. If, however, you are not full timing, then you have a whole different ball game. First you need to find out what your home state's residency laws are. What constitutes residency in your state? In some states it is just being there for 30 days makes you a resident, so find out what that requirement is. Next, can you document your compliance with your state's residency requirements? If you can't then forget it and pay the tax. Remember that the burden of proof is on the taxpayer, not the state.

Even if you are correct and have all your residency ducks in a row it does not mean that you won't have an overly aggressive state auditor come calling and making your life less than pleasant. We have one residency audit that is now in its third year and the guy is without a doubt not a NY resident, but the state doesn't want to believe it.

XBoater · 06-01-2015, 12:46 PM

Quote:

Originally Posted by Lobstah

I had one, for awhile, until my wife wanted to start "work camping" in Mass, and the local news stations ran a few segments on how we were all tax cheats and destroying the economy becuase we used the same rules everyone else did.
At that time, I switched my registration to Mass, and paid my $5k in tax.

Are you a Mass resident? Not sure "work camping" in Mass would be worth the $5k donation. What town do you pay the excise tax too? Also what channels did the in-depth investigation?

twogypsies · 06-01-2015, 06:08 PM

If your domicile is in another state then a LLC is not for you. If you're a full-timer and can choose wherever you want to domicile, then a LLC is perfectly legal without problems.

Skip426 · 06-01-2015, 06:35 PM

Quote:

Originally Posted by LDMcL

Skip426
I have been thinking about a LLC and reading the Ontario Highway Traffic Act about what triggers obtaining an Ontario license for the LLC motorhome.
You seem to be farther along in the learning curve than I am and was wondering the basis of your statement.
Thanks:

Len ; This came up when I looked into the LLC 4 1/2 years ago.
If you get to the border as a Canadian citizen driving a USA registered vehicle , you can be denied entry into Canada, seems the border guards figure you're trying to dodge taxes. I was allowed across with a Montana temp decal , and proof of B.C. insurance , because I was going home to complete registration and inspection, paid GST at the border and PST when I got the plates. Tax man happy.

Me not so much.
A friend was turned around at Canada Customs driving a USA plated rental car , he had flown to NY city and wanted to tour the Maritimes from there, had to return and get a Canadian registered car from the rental company.
Things may have changed, in the years since , but you know; Revenue Canada, wants their pound of flesh, so I doubt it.
I'll see if I can track the actual rule in writing and re-post.

Lobstah · 06-02-2015, 07:33 AM

Quote:

Originally Posted by XBoater

Are you a Mass resident? Not sure "work camping" in Mass would be worth the $5k donation. What town do you pay the excise tax too? Also what channels did the in-depth investigation?

It was on the evening news several years ago. I don't live in Mass anymore, but at the time, reporters were out roaming the streets, looking for motorhomes with out of state tags on them.

The rules in Mass, at least at that time, was that you had to pay sales tax on any vehicle that was in the state for 30 consecutive days, regardless of where it was registered. So every 29 days minimum, you had to leave the state, and document it. Toll rcpts were an easy way to do this, and actually, my motorhome didn't spend much time in Mass at that time.

Had a similar issue with a boat that I purchased up in Maine, that was berthed in Maine. Mass said they had proof that I had a boat in Mass that I had not paid sales tax on, and demanded about $6k. Took a few letters to satisfy them that the boat was kept in Maine and they had no claim.

As for work camping being worth the $5k...what value to you place on marital bliss?

hal1phx · 06-02-2015, 07:44 AM

We looked into this possibility when purchasing our Bus .... Let me say that if you own property in another state, or spend a lot of time in another state, it will get a little disy as stated above .... We didn't have either of these issues so we thought we were good to go until our lender informed us the Bus could not be titled to the LLC, as would be the requirement ....
As stated earlier, once the above is satisfied, give a call to the office below ... they are very helpful and well versed in the process .... they were recommended to me by an auto collector who uses them exclusively .....
Heggen Law Office, P.C.
2675 Palmer Street/ suite F
Missoula, MT 59808
406-327-0401
Ask for Lisa

Make certain you have it all together as legal costs will more then gobble up the savings if the state comes after you .........
We ended up using SD as our home state for vehicle registrations and mail forwarding.

Sky_Boss · 06-02-2015, 08:09 AM

If you have income that can be taxed in Montana...do the math...

SD has ZERO income tax as does TX & FL the other popular options for full timers. SD had a 4% sales tax on vehicles. I'm not trying to short shrift the other states on their pros and cons just pointing out my experience based on our choice to call SD home.

If your domicile is in another state that taxes MHs (registration, property, and/or sales tax) then the LLC can be dicey, especially if you have to pay for the set up and then defend it.

SEE THIS ARTICLE

The short story is that the MT LLC is LEGAL in MT but probably has no standing in another state as a means to avoid taxes for that state.

wnytaxman · 06-02-2015, 09:10 AM

Quote:

Originally Posted by Sky_Boss

If you have income that can be taxed in Montana...do the math...

SD has ZERO income tax as does TX & FL the other popular options for full timers. SD had a 4% sales tax on vehicles. I'm not trying to short shrift the other states on their pros and cons just pointing out my experience based on our choice to call SD home.

If your domicile is in another state that taxes MHs (registration, property, and/or sales tax) then the LLC can be dicey, especially if you have to pay for the set up and then defend it.

SEE THIS ARTICLE

The short story is that the MT LLC is LEGAL in MT but probably has no standing in another state as a means to avoid taxes for that state.

Actually the Montana LLC can be legal in most states IF you comply with that states registration laws and you properly document that compliance. If you have to defend your use of the Montana LLC, you may have costs that exceed any sales tax savings. We have a NYS residency audit that is now in its third year so be aware that paying the sales tax may be your cheapest option.

Gary RVRoamer · 06-02-2015, 09:21 AM

The Montana lawyers are right - it is easy to set up a Montana LLC. Whether it's a good idea for you to do so is a much more complex question. Odds are, if you have a home or residence (domicile) in another state and plan to keep the RV there even part time, you will still owe taxes in that state and the benefit of a Montana LLC will be small, if any.

To answer the rest of your questions:
1. No, it's not complicated and a Montana law firm will handle the details
2. There is no required additional or higher expenses in subsequent years except annual vehicle registration fees. However, if you enlist the law firm to remain as your legal representative, handle renewals, provide your Montana address or mailbox, etc., then yes you incur ongoing fees for those services. Ask about such costs before agreeing to use the law firm for ongoing services. You can do it all yourself, but many people don't want to bother.

XBoater · 06-02-2015, 09:57 AM

Quote:

Originally Posted by Lobstah

As for work camping being worth the $5k...what value to you place on marital bliss?

Marital Bliss ???

Priceless

As too Montana LLC, it is a RISK vs REWARD question you must answer for yourself. This forum should just be the first stop, there is a lot more information you should have and questions to be asked, before a decision like this is made.