Community Forums

Ragman · 10-02-2007, 07:37 PM

Has anyone had experience licensing their motor home in Montana through an LLC? If so, what is involved, how long did it take and any problems you may have encountered.

We are getting ready to purchase a diesel-pusher and our fine state of Texas charges 6.25% sales tax. I read where Colorado residents are getting thumped for doing this. We are in the process of selling our home to be full timers and wouldn't think it would be a problem.

We are looking at going through RVfinancing.com at 6.87% and they have a link to RV LLC.

Would appreciate any advice on this subject.

Thanks,
Larry

NeilV · 10-03-2007, 12:44 AM

Quote:

Originally posted by Ragman:
Has anyone had experience licensing their motor home in Montana through an LLC? If so, what is involved, how long did it take and any problems you may have encountered.

We are getting ready to purchase a diesel-pusher and our fine state of Texas charges 6.25% sales tax. I read where Colorado residents are getting thumped for doing this. We are in the process of selling our home to be full timers and wouldn't think it would be a problem.

We are looking at going through RVfinancing.com at 6.87% and they have a link to RV LLC.

Would appreciate any advice on this subject.

Thanks,
Larry

If you are doing this to get out of having to pay the Texas tax while you are still residing there then it could be a big problem. If you are going to be moving out of Texas anyway then do that first and take up residence in Montana. Many people move to another state for economics etc but to set up an LLC to evade taxes is a bit transparent to the authorities and you will always have that hanging over your head. Why take a chance on something like this.

DonnaB · 10-03-2007, 02:11 AM

Quote:

Picture of Ragman

Posted October 03, 2007 12:37 AM
Has anyone had experience licensing their motor home in Montana through an LLC? If so, what is involved, how long did it take and any problems you may have encountered.

We are getting ready to purchase a diesel-pusher and our fine state of Texas charges 6.25% sales tax. I read where Colorado residents are getting thumped for doing this. We are in the process of selling our home to be full timers and wouldn't think it would be a problem.

We are looking at going through RVfinancing.com at 6.87% and they have a link to RV LLC.

Hi,

We were/are TX residents and went full time in January of this year. In April we purchased a new DSDP from Lee's RV in Oklahoma City. We had set up a MT LLC a few months before in prep for this and it was easy. We used Helen Fandrich at MT Corp. Services to set up the LLC. I think the cost was around $300. Now if you are financing, you will also need additional paperwork that requires an attorney. Just the LLC does not. That added agreement was another $300 and Helen gave us the attorney contact. We advised Lee's RV we were buying thru the LLC and they were quite adept at doing all that was required. They send off the paperwork to MT and she sends you back your license. It is around $35 a year to maintain her services plus the cost of your annual tags. The first years was just over $300 and it is on a declining scale after that.

Now....although still TX residents, we no longer own property in TX and are full time travelers and don't spend all that much time in TX and will certainly be there no more than 2 to 3 months total in a year. If that isn't your circumstances, your mileage may vary. If we still had a house and spent time there, I'm not sure that this would be a workable solution, but it works for our situation. Good luck.

sharbra · 10-03-2007, 09:37 AM

Check with the company that will be financing your RV and find out who they recommend you contact to form your LLC. Some financial institution have preferences. Once you contact the profession who will be preparing your LLC do not hesitate to ask questions.

Dalsn1 · 10-03-2007, 12:02 PM

Keep in mind that one test used to establish residency is where you vote. If you continue to vote in Texas then it will be hard to prove your not a resident. Also make sure you understand the federal filing requirments that take effect for the 2007 tax year.

Tom N · 10-03-2007, 01:25 PM

Quote:

Originally posted by Dalsn1:
Keep in mind that one test used to establish residency is where you vote. If you continue to vote in Texas then it will be hard to prove your not a resident. Also make sure you understand the federal filing requirments that take effect for the 2007 tax year.

There is no requirement that a vehicle has to be registered in the state where you vote.

Many own condos and have a vehicle registered in that state. They do not vote there and have residency in another state. My Dad did that for 20+ years.

-Tom

Rick A · 10-04-2007, 03:28 AM

There are many test to establish residency and each state differs. You need to make sure of the laws of the individual state you are considering establishing residency in.

As for LLC's, it is absolutelty illegal to esatablish an LLC for the sole purpose of registering a vehicle in another state with the intent to avoid taxes. This is pure tax evasion and I am glad states are cracking down on the people who are doing this. If you can not afford the taxes, you can not afford the lifestyle if you have to break the law to do it.

Tom N · 10-04-2007, 03:43 AM

Quote:

Originally posted by Rick A:
As for LLC's, it is absolutelty illegal to esatablish an LLC for the sole purpose of registering a vehicle in another state with the intent to avoid taxes.

If the above is true, why aren't the MT attorneys prosecuted???

-Tom
http://autos.groups.yahoo.com/group/RV_LLC/

Two Bit · 10-04-2007, 06:48 AM

Since when do they prosecute attorney's for their client's illegal activities.

though that would cut down on the bad attorney population would'nt it!

Texas residency has nothing to do with owning property (land) in Texas. Tens of thousands of Texas residents own no property (take apartment dwellers for example).

Either become a resident of another state prior to purchasing something you dont want to pay Texas taxes on or pay the Texas taxes and remain a Texas resident. You cant have your cake and eat it too! It is called Tax fraud.

Tom N · 10-04-2007, 01:49 PM

Quote:

Either become a resident of another state prior to purchasing something you dont want to pay Texas taxes on or pay the Texas taxes and remain a Texas resident.

Since when do they prosecute attorney's for their client's illegal activities.

True, but you're not purchasing anything, the LLC is.

In my opinion MT attorneys are not advertising in all the RV magazines to do an illegal activity. Advertising to perform an illegal activity would probably be just cause to be dis-barred.

-Tom

rebelsbeach · 10-04-2007, 03:07 PM

Ya'll play nice now....

adj · 10-04-2007, 04:04 PM

Quote:

Originally posted by Two Bit:
Since when do they prosecute attorney's for their client's illegal activities.

though that would cut down on the bad attorney population would'nt it!

Texas residency has nothing to do with owning property (land) in Texas. Tens of thousands of Texas residents own no property (take apartment dwellers for example).

Either become a resident of another state prior to purchasing something you dont want to pay Texas taxes on or pay the Texas taxes and remain a Texas resident. You cant have your cake and eat it too! It is called Tax fraud.

Well said!

Gary RVRoamer · 10-04-2007, 05:35 PM

Whoa! Slow down.

There is nothing illegal about establishing a company (an LLC) in Montana and certainly no attorney could be even reprimanded for doing so. What may possibly be illegal in some states is using your Montana LLC to avoid paying taxes in that state, and if it is "illegal", it is illegal only in that state and in that one particular person's circumstances. It may be quite proper for another person with just slightly different circumstances. The important thing to remember is that the laws and the courts in the state that wants the tax revenue are the ones that apply to the tax fraud question - not the laws of the state of Montana where the LLC is indeed perfectly legal.

To the best of my knowledge nobody has yet been required to pay sales/use taxes in any state on property owned by a Montana LLC. Several states are making noises, investigating and perhaps even trying to intimidate their citizens from using a Montana LLC, but nobody has received a tax bill. Yet.

Personally I believe it will happen before too long, but it will likely be a case where some individual has flagrantly bought and used an RV in some state and had the LLC solely as a tax dodge. The federal IRS has long established the principle that an otherwise legal endeavor can be declared an illegal tax dodge if tax avoidance is clearly its only benefit to the owners/investors. My guess is that a few states will attempt the same tactic.

plntmgr · 10-05-2007, 06:04 PM

I set up my LLC prior to purchasing my '03 Dodge and '04 Titanium 5er. I must keep my vehicles out of the state for 6 months and 1 day to be legal. I have done that (I think) but I do not flaunt my presence when I'm in my resident state. I have not run into problems, but should the system fail, I would register tomorrow to avoid problems.