Community Forums

bpretor · 09-16-2013, 08:08 PM

Hi Everybody,
I am a new member (62) hoping to retire next year and to buy a RV. I currently live in MA and I wonder if I would have to pay the initial sales tax (6.25%) and then the annual excise tax, like on cars. If so, is there any way out of that? I know that some boat owners buy their boats in Delaware to avoid the tax. Is that an option with an RV? I am very new to this and would appreciate any help

worleybyrd · 09-16-2013, 08:14 PM

i live in MI. and have all my toys titled in ohio for tax and plate and the big one INS. i own a few houses in ohio and Mi. so i just use one of the lots i have as the storage and address

RickO · 09-16-2013, 08:55 PM

Welcome to the forum and congrats on your new rig.

This is discussed here a lot in one form or another. There is a large sentiment that we all should pay the taxes which are legally due... just as our neighbors do.

Obviously the trick is to clearly understand what is legal and what is not. What is avoidance and what is evasion.

Avoiding sales tax in a particular state can certainly be done legally. You just need to really understand the ins and outs. Many folks set up a Montana based LLC and the coach is owned by that "company"... which is owned by you. This has been popular (and legal) for years.

Lately, more and more reports have come out that states are cracking down on this type of thing and at least making things more challenging. Use our search function for "LLC" and you'll have all the reading material you could want.

Something else to consider is insurance and financing. Be sure you know how each of these fit into whatever strategy you choose. Re: insurance... be sure to think about how it might be effected if it's registered in one state and yet stored in a different state. Could a claim be denied?

Lots to think about, but lots of things are possible.

Good luck.

Rick

Mr_D · 09-16-2013, 09:06 PM

To add to Rick's answer: Some insurance companies won't insure an RV owned by an LLC and some finance companies won't finance them either.

**JohnRR** · 09-16-2013, 09:36 PM

Be careful using a message board for such a step, you need to contact a local/Ma accountant

MSHappyCampers · 09-17-2013, 09:36 AM

Welcome to IRV2! We're sure glad you joined the gang here!

Sorry I can't help with your question, but I'm sure someone will answer it for you! Enjoy the forum!

Good luck, happy trails, and God bless!

Medico · 09-17-2013, 03:21 PM

Welcome and glad to meet you!

Mekanic · 09-17-2013, 03:32 PM

Quote:

Originally Posted by JohnRR

Be careful using a message board for such a step, you need to contact a local/Ma accountant

I agree on this.

But if I was in you spot I'd just temporally Move to a state that has neither Sales tax or excise Tax. And I'd do it for real so it is legal if some thing comes up later.

wnytaxman · 09-18-2013, 07:37 AM

Even a MA based accountant may not know the ins and outs of sales tax law when coupled with DMV laws about domicile. As a general rule, if your driver's license is from MA and you vote in MA, you are considered to be a MA resident.

In addition to the sales tax laws you need to check out the DMV regulations about when a vehicle has to be licensed in your home state. If you can comply with those MA DMV regs, then you may have a chance of avoiding the MA excise tax. But be aware, even your former senator, Mr. Kerry, got caught with his hands in the excise tax avoidance jar with his yacht. If they will nail a big wig politician the little guy doesn't stand much of a chance.

bpretor · 09-18-2013, 06:39 PM

Thank you guys for your very useful advice. I am not against leaving MA when I retire, vs. breaking the law and risk big penalties. Is there a list of states and what the sales tax and excise tax would be? I love this site, am so glad I found it. Thank you, thank you.

Mr_D · 09-18-2013, 06:49 PM

OR No sales/use tax but about 10% income tax on most income.
WA About 9% sales/use tax but no income tax.
CA? Everything they can tax they will.

Retired and Happy · 09-18-2013, 10:28 PM

GA just changed its law to read that you pay the Ad Valorem tax once, then just a $20 tag fee annually thereafter. We just paid over $3000 tax for the rig we just bought in MS. that's ok because we intend to keep this one for a long time. We were paying around $300 a year for the older MH.

Mr_D · 09-18-2013, 10:55 PM

Those taxes and license fees do add up. In 2000 the yearly license fee for our '98 Santara were $2,400, then there was a referendum and they went down to $35 a year!!
That spurred us to buy the 2000 DSDP. Now, of course they're raised the yearly license fee to $135 by adding weight taxes. Still cheap compared to what it was!

wnytaxman · 09-19-2013, 06:52 AM

Sales taxes are a bear when you buy a new rig, however the excise or personal property taxes that many states impose are the taxes that keep on taking and taking and taking. Surprisingly NY does not have either taxes and our sales tax is the major detriment as it can be close to 9%, but after the initial hit, it's not too bad. Also our license fees are relatively mild.

Virginia is a state that has the personal property tax, but it is not in every county so it does take some research as to where is the best place to be. Just across the border from you is NH which has no sales tax, but I'm not sure about the excise or personal property tax.

Ed