For you tax gurus....

[Mark D]

I was in your place several years ago. I had several business, a C Corp, S class LLC and a few LLC's. I sold a few of them off and retained LLC's that held commercial real estate and open land in Horry County SC. We live in Connecticut but spend 4 to 5 months in winter out of the state and several trips over the summer. For the registration our last coach we registered in Montana. Its $800 to start and a few hundred each year to keep registered and registered agent fees. I have it insured with zero issues, and a large umbrella. In Ct it would have been close to $25k to register and another $5 to $6 k each year in property taxes. Not a typo.

People raise issues about the legality of this and what states will do. I agree that some will have hard time is questioned but myself I have business in several states so myself having this situation is not uncommon. The people that may have an issue are the ones that have a basic income or are retired with a single resistance and have no justifications for such a situation.

So I would say take the Montana route if you can justify the situation. It's also easy to pull that asset out down the road to register in Florida if need be. To be very safe if you have a property or small LLC that is used as a vessel drop that into the Montana LLC then it's better justified as a business asset.

As far as financing I will say 100% no question cash. If I can't pay cash for an item like that then it's too much and I can't afford it. My reasoning is and has always been that you finance something for X today but in two years you can no longer afford X. Then you are shouldered with another debt that is risking your long term situation.

An example is our current coach, it sold for (not sticker) $630k the first owner spent a fortune on add on's and updates / upgrades from the factory. 4 or 5 years later their situation changed, their fancy coach was repossessed and I paid 40% of what it sold for new. Now if they bought a lesser or used coach cash they would have just had to tighten their belt or possibly sell it to help cover more important assets.

I am considered frugal by my friends, they pick on me because I buy a car new or a few years old for cash and drive it until its junk. My favorite car is a 2005 Range Rover with 150k miles on it. Rides great, plenty of power and still looks nice so why spend loads of money to get a new one? I live in a modest house in a nice neighborhood. But everything but my commercial income producing properties are paid for. Bit of a side track but here is the point. I bought my first small company at 30 and sold off it off at 43 so that I would live longer! I am now 47 and my friends who struggle only tease me about being frugal and then spend, spend, spend vs. follow my lead. By spend I mean keeping up with the Jonse's eating out at nice resturant's 5 days a week etc....

[nothermark]

One thing I would look at is how you have your money set up. If you are mostly in tax deferred investments consider pulling some out each year starting now. I'd be looking at the difference between what I earned and what the next tax bracket started at. That will probably be lower income tax than taking a chunk out when you retire. If you are too young to take it out then just stop putting it in and put it in a taxed investment you can pull out of.

[Ivylog]

OP, does AL charge ad valorem tax when you first title a MH or do you start paying the second year?
Claiming Florida residency and owning a home in GA is going to raise a red flag if you use the GA home very much.

In GA the tag fee is $20/year BUT there is an additional $100 heavy vehicle tax (26,000+ weight) making my tag $120/year.

If you bring a vehicle you own into GA from another state you have to pay sales tax again based on the NADA value.

Florida charges sales tax again on a vehicle you bring in IF you have owned it less than 6 months. No sales tax if you have owned more than 6 months before bringing it in. A 2 year tag is $150-$170 on a MH.

[sclements]

I will have to check on AL tax law. I know our sales tax upon purchase is very low, but then the annual taxes on a Motorhome are high. We have a home and five vacation rental condos in Florida. Our primary residence right now is Alabama,and we have rental homes here. We have two vacation rentals in GA. It may be that I should buy it and register in AL, but transfer to FL after the six month period?

[wnytaxman]

Originally Posted by sclements

I will have to check on AL tax law. I know our sales tax upon purchase is very low, but then the annual taxes on a Motorhome are high. We have a home and five vacation rental condos in Florida. Our primary residence right now is Alabama,and we have rental homes here. We have two vacation rentals in GA. It may be that I should buy it and register in AL, but transfer to FL after the six month period?

If your sales tax is low, then that may make the most sense. You could buy and pay the taxes in AL and then six months later establish your residency in Florida and you should be good at that point. I'm aware from others on here that Florida does have a unique law which allows one to purchase a rig and leave it out of the state for six months and then not pay the Florida sales taxes.

The Montana LLC as suggested earlier is not quite the slam dunk that many assume it to be. You need to find out the residency, sales tax and use tax, and licensing laws of your state to see if you can comply with those laws. Montana has also instituted a separate tax on high end rigs that runs for ten years which diminishes Montana's attractive LLC status. Each state is different and is unique as to how you need to comply with those
laws. For example, here in NY I could put a rig into a Montana LLC but by personally being a NY resident I can not drive it in NY without being liable for the sales tax.