Sales Tax and Registration

[FJM]

My wife and I plan to sell our house, buy an RV, and travel the country. Once we sell our house we won't be residents of Florida, technically speaking. So here's my question: Does anyone know what state or states have the lowest sales tax on RV's and what state has the lowest registration fees? That might help decide what we do. Many thanks for your input. FJM

[jzick]

Google is your friend in these cases

Sales Tax

Rates | Sales Tax Institute

Registration

Registration and Title Fees By State (2012 chart)

[swampdog2]

montana

[RustyJC]

If you're going to change your domicile, I'd suggest basing your decision on far more than sales tax and vehicle registration charges. Otherwise, you might wind up in a state with low/no sales tax and minimal vehicle registration fees, but with an income tax on investments and retirement income, prohibitively high insurance rates (vehicle, health, etc.) and other disincentives.

There are many discussions on establishing domiciles here on iRV2 - if you click on Search in the toolbar at the top of the page and enter "domicile" in the search box, you'll get a lot of reading material.

By the way,

Rusty

[Clay L]

Three of the most popular states for full timers to have as their legal domicile are SD, TX, and FL.

The tax on vehicle purchases in SD in 3 %. I think it is 6% in TX.
My registration/plates in SD last year was about $265.

We use Alternative Resources in Sioux Falls SD as our mail forwarding service and their street address is the address shown on our drivers licenses and registration.
Since we are full timers they excused us from jury duty.

[Medico]

The nice thing is that for 2012 and 2013 the Federal Government finally passed legislation (retroactive back to 2012) to once again allow sales tax deduction on our income tax returns. The very large sales tax I am paying for my MH to NY can be deducted when I do my income tax next year. This will allow me to get most if not all my Federal tax withheld back. Since I live in NY they generally follow the federal rules with income tax deductions.

[RickO]

Hi and welcome to the forum.

Rusty gave great advice. Take a serious look at ALL of the impacts of a domicile change and use our search feature as a resource.

We sold our home in California in 2009 to go full time and chose Texas as our domicile. We've been happy with that decision.

Best of luck.

Rick

[palehorse89]

This is the latest I can find on the IRS website. When Ibought ours I thought I was going to write the sales tax off and get a bunch of it back......... I recovered about a 1/4 of the tax I paid if I remember right:

Sales Tax Deduction for Vehicle Purchases

2010 update: Pub. 919 no longer contains Worksheet 10. Eligible taxpayers may use Schedule L, Standard Deduction for Certain Filers, to figure their new motor vehicle sales tax deduction.
The American Recovery and Reinvestment Act permits taxpayers to take a deduction for state and local sales and excise taxes paid on the purchase of new cars, light trucks, motor homes and motorcycles. The deduction is available on new vehicles purchased from Feb. 17, 2009, through Dec. 31, 2009. In states that don't have a sales tax, the law provides a deduction for other taxes or fees paid. This deduction is available whether or not a taxpayer itemizes deductions on Schedule A.
The deduction is limited to the taxes and fees paid on up to $49,500 of the purchase price of an eligible vehicle. The deduction is reduced for joint filers with modified adjusted gross incomes (MAGI) between $250,000 and $260,000 and other taxpayers with MAGI between $125,000 and $135,000. Taxpayers with higher incomes do not qualify.
Taxpayers who make qualifying new vehicle purchases this year can estimate the deduction with the help of IRS Publication 919, How Do I Adjust My Withholding? Lines 10a to 10k on Worksheet 10 take into account purchases above the $49,500 limit, as well as the reduced deductions for taxpayers at higher income levels.

[wnytaxman]

I'd like to clarify pale horse's post. The sales tax deduction limit noted in his post applies only to 2009. The rules are much different in 2012. To take the sales tax deduction you must be able to itemize your deductions. You can take the greater of your state income tax deduction or your sales tax deduction. To figure the sales tax deduction you will use a table in the IRS instructions and to that you can add sales tax paid on a vehicle or vehicles. Also included in this list are boats, motorcycles, and airplanes. If the total of the sales tax paid on your vehicles purchase plus the table amount is greater than your state income tax then you can take the sales tax deduction.

There is another benefit to the sales tax deduction which applies in the next year. If you take the sales tax deduction this year and you have a refund of your state income taxes this year, you will not have to claim that tax refund in the following year. It's the deduction that keeps on giving.

[ClayB]

In Oregon...no sales tax (yet), Registration depends on length.

http://www.odot.state.or.us/forms/dmv/465.pdf

Clay
New to full timing (6months)
New to me 98
Georgie Cruise Master 34'

[FJM]

Originally Posted by wnytaxman

I'd like to clarify pale horse's post. The sales tax deduction limit noted in his post applies only to 2009. The rules are much different in 2012. To take the sales tax deduction you must be able to itemize your deductions. You can take the greater of your state income tax deduction or your sales tax deduction. To figure the sales tax deduction you will use a table in the IRS instructions and to that you can add sales tax paid on a vehicle or vehicles. Also included in this list are boats, motorcycles, and airplanes. If the total of the sales tax paid on your vehicles purchase plus the table amount is greater than your state income tax then you can take the sales tax deduction.

There is another benefit to the sales tax deduction which applies in the next year. If you take the sales tax deduction this year and you have a refund of your state income taxes this year, you will not have to claim that tax refund in the following year. It's the deduction that keeps on giving.

Many thanks, wnytaxman. No state income tax here in Florida, nor in Texas, where I might reside. I'll check IRS publications this weekend. Again, I appreciate your help with this.

[wnytaxman]

Originally Posted by Medico

The nice thing is that for 2012 and 2013 the Federal Government finally passed legislation (retroactive back to 2012) to once again allow sales tax deduction on our income tax returns. The very large sales tax I am paying for my MH to NY can be deducted when I do my income tax next year. This will allow me to get most if not all my Federal tax withheld back. Since I live in NY they generally follow the federal rules with income tax deductions.

As a fellow WNYer and a CPA I can tell you that NY follows the fed almost to the line item. We actually get a couple of breaks in NY, granted, not many breaks, that the Feds don't allow. Other than the initial sales tax hit we take here, owning a motorhome is relatively cheap in NY as our registrations aren't that expensive and we have no personal property tax.

Ed

[wnytaxman]

Originally Posted by FJM

Many thanks, wnytaxman. No state income tax here in Florida, nor in Texas, where I might reside. I'll check IRS publications this weekend. Again, I appreciate your help with this.

My pleasure FJM. Glad I can help. As I like to tell my clients, I'm not just another pretty face! And you know, noone argues that point with me.

Good luck in your search for information.