Montana LLC question

[azloafer]

I won a $40,000 5th wheel in a Camping World Sweepstake here in Arizona. That was great, but then the tax man cometh. The AZ State Dept of Rev told me several times that we do not have a sales tax...BUT we do have a use tax. The state, county and city all have their own use tax which comes up to slightly over 8% when added together. They explained that the USE TAX is paid by the dealer for the privilege of dong business here, so then the dealer passes the tax onto the purchaser. In the end it makes no difference what they call it...I still had to pay the use tax and high registration fees and the 2010 federal tax To come. The only place where we could save was to pay the federal tax on the FMV (fair market value) rather than the MSRP.

Death and taxes... Happy Travels, Joe

[JohnRR]

Well at least I can say Congratulations on your win.

[J Rod]

Add the State of Washington to your list. Also may be a felony related to tax evasion.

[a k]

If you take delivery out of state there is no tax. Thats why when you by a coach in Arizona they drive it to California and you pick it up there. Same for Classis cars from Barrett-Jackson. If you take delivery after sale and drive it out, it's tax time, but if you pay a shipper to deliver it to your out of state address there is no tax.

[RickO]

Originally Posted by a k

If you take delivery out of state there is no tax. Thats why when you by a coach in Arizona they drive it to California and you pick it up there. Same for Classis cars from Barrett-Jackson. If you take delivery after sale and drive it out, it's tax time, but if you pay a shipper to deliver it to your out of state address there is no tax.

If I understand what you are saying, this doesn't sound right to me.

Are you suggesting that if a California resident purchases a coach from an Arizona dealer and has it delivered to his California address there is no tax to be paid or simply that the tax won't be collected by the Arizona dealer at the time of sale?

rick

[a k]

Bingo. My friend bought a new coach and took delivery in California.The dealer had it driven to CA. He lives in Kentucky. No tax.

Check Barrett-Jacksons web site and you will see how they do it. been there,done that.

[RickO]

Originally Posted by a k

Bingo. My friend bought a new coach and took delivery in California.The dealer had it driven to CA. He lives in Kentucky. No tax.

Check Barrett-Jacksons web site and you will see how they do it. been there,done that.

I just don't buy that this is legal in most states. I can understand the dealer not having to collect the tax at the time of sale if he delivers it out of state but, like in my example of an Arizona dealer and a California resident, California would then have their hand out when it is registered there and they will charge their "use tax" rate on the purchase price so I only see it delaying when the taxes must be paid and to whom.

Rick

[a k]

It's legal in Montana. That's all that matters.

[RickO]

Ok, I see what you're saying. You weren't suggesting that it was legal but rather that one could probably get away with it. I don't disagree with that.

There are many ways to evade taxes.... all of them illegal.

PS: If by "register it in Montana" you mean that all of this is happening within an LLC then please disregard my comments above.

[a k]

People should just do what they are comfortable doing.

[a k]

If you undo your LLC and title the coach back in MO remember you will probably end up paying 7% property tax each year on it . If you have to pay the sales tax, pay it and leave it registered in Montana. Plus if you croak it will pass on to any other member(Kids) that you list on your LLC.

[User1011]

Missouri has 'personal property' tax on vehicles due by Dec 31st of each year.
The licensed owner of record on January 1 of the year is responsible for the personal property tax. If you sell the vehicle on January 2nd, you are still responsible for the tax. The new owner doesn't pay until the following year. The personal property tax is declining each year based on the 'valuation' of the vehicle. This personal property tax in MO is in addition to the vehicle inspection fee (required every other year) and the licensing fee.

California does not have a personal property tax on vehicles but they do on 'boats' and 'airplanes' (same rule as MO - whomever owns it on January 1st pays the tax). The tax for vehicles in CA is included in the annual licensing fee.

Southern CA boat dealers were taking boats into Mexico and leaving them at a marina for 91 days and the purchaser would go there for pick-up/ delivery. After the wait period they would return to CA. avoiding taxes... from all we know CA caught up with this scam. Don't know if they are still trying to do this or not.

CA residents were getting an Oregon address or PO Box and registering the MH rigs in Oregon for the same reasons. Heard CA was on to that scheme as well.

[a k]

Anybody know how Sen Kerry did his boat?

[azloafer]

Originally Posted by a k

Anybody know how Sen Kerry did his boat?

I recall reading a follow-up story that he ended up paying all the taxes that were due when his story became public. Joe