Virginia Property Tax

[Stan Boddie]

Are there any states that allow you register the coach in the state, pay no state property tax, while living and residing in another state? We live in Virginia, just checked the Virginia state property tax, and found the taxable amount to be a near show stopper in our plans to purchase a 2013 Anthem DLQ.

If no states allow this are there any legal strategies that we can consider to reduce the exorbitant property tax for Virginia?

Unhappy 2013 Anthem DLQ Dreamer

[chief02]

South Dakota?

Many full timers set up residency there. Must be a reason.

[RustyJC]

Originally Posted by chief02

South Dakota?

Many full timers set up residency there.

"Full timers" being the critical term. Fewer and fewer states are ignoring the fact that your vehicle is licensed in another state while you're a permanent resident of a given state. Full-timers, however, are generally always on the move and not a de facto permanent resident of any state; they have the luxury of picking a state in which they can declare "permanent residency". Most states in which you would physically reside on a permanent basis (Virginia included, I suspect) would require you to license the vehicle in your state of residency.

If you're willing to take the chances (and it's getting riskier all the time as more and more cash-hungry states zero in on what they perceive as tax evasion), you might want to search here on iRV2 for the term "Montana LLC". I wouldn't do it (but then again, Texas doesn't have ad valorem or personal property taxes), but you might decide to try it.

Rusty

[wnytaxman]

You need to see what the requirements are in Virginia to registration for Virginia residency. The Montana LLC can work in certain situations, but the first thing you have to do is to find out what the residency laws are in your state and then ask whether or not you can meet the requirements.

One of my clients tried the Montana LLC route and got caught by NYS Taxation. It can be an expensive proposition if you get caught not complying with your home state's laws.

[tim5055]

Originally Posted by Stan Boddie

If no states allow this are there any legal strategies that we can consider to reduce the exorbitant property tax for Virginia?

As Rusty has pointerd out the legalities may be questionable, every case is different and every person has their own tolerance for what they consider right/wrong. With that being said, Montana is another option.

The Bennett Law Office does a lot of this work and it can't hurt to call and get an opinion. But I would also talk to my tax adviser and an attorney in VA as that is where you will be going to court if the Commonwealth has a different opinion as to the legality of what you choose to do.

Registration Services - Bennett Law Office P.C.

[hdgoldie]

You might also want to check if how you register the vehicle impacts any financing you might need. My understanding is that it's very difficult to obtain financing for some of the alternative registrations. That being said, if you are looking at a cash deal I think I heard that one of the states on the east coast offered the same type of arrangement as Montana. Maybe New Hampshire? An internet search should give you the info you seek.

Buyers of our old coach used Action Services, LLC in Montana to register the coach. They are full timers but apparently Action exists specifically for this purpose and has contacts for possible financing and insurance. Bear in mind that your insurance costs will be higher if you choose to register the coach this way. Businesses, even a small LLC, pay higher insurance premiums. Just one more piece to weigh when making your decision.

[wnytaxman]

Just as a point of clarification, an LLC is not necessarily a business. The term LLC is a Limited Liability Company and it only implies legal protection from potential lawsuits, not necessarily a business purpose. However, as hgoldie pointed out, an insurance company or finance company may not be aware of that distinction and may treat you as a business for insurance and or financing purposes. Lately the questions we are getting from banks and finance companies tend to make me think their intelligence tests are graded on a curve.

Getting back to the LLC issue. A tax attorney or a CPA may not necessarily know the auto registration laws in your state so they may not be aware of what you need to do to comply with your state's residency laws for vehicle registration. My client who got in trouble had purchased his new rig in Florida and used a Montana LLC to register it....no sales tax so he saved about $18,000 in sales tax. Well, he saved it until he got the letter from NY hitting him with the tax plus penalty and interest. The requirement in NY, as I understand it, is that the vehicle must leave the state once every 30 days to not be considered a "resident" vehicle. He couldn't prove that he did that, so he got dinged.

In real simple terms, find out the law and if you can comply with the requirements and prove that you complied, then the Montana LLC may work for you. If not then I would strongly recommend that you don't do the LLC. We are finding all the states are getting very aggressive in going after what they feel is owned to them. Even if you comply and can prove you complied you may still have to defend your decision and that can be costly.

[jzick]

If no states allow this are there any legal strategies that we can consider to reduce the exorbitant property tax for Virginia?

You can move to a state with no property taxes on rvs (Texas, Florida, etc.). Most, if not all, states require that vehicles be registered there if you work in the state, vote there, send kids to school and other things. If you are stuck in a particular state for reasons like these then you will end up paying the taxes. Full timers pick states like Florida, South Dakota, and Texas typically for tax reasons.

[TAZ]

If the coach Is in VA for more than 90 consecutive days it is required to be registered in VA. The fines can be huge. We love VA but when we retire we are moving to TX.

I used to live in FL and it was a shock with the taxes I now pay. My county is one of the highest in VA.

[chuckinthebus]

Only problem I see may develop with the LLC is the way our gov is digging deeper into any pocket they think may have change left. LLC may make one fall under DOT guidelines as even a not for profit biz and require you to have CDL and USDOT number. Remember you are being suggested the LLC as a way to change possible location of MH. Get advise from many 'official' knowledgeable people before making your choice. TN only requires sales tax on a motor vehicle, then it's $28.00 a year for tag. Good luck.

[USMCRET]

Stan, the property tax you are referring to is not a state tax. Rather, it is an ad-valorum, or personal property tax levied at the county level. Prince William county in VA does not tax motorhomes. Since the tax is based on where the motorhome is garaged, and not the residence of the owner, you can live in Spotsylvania county as I do, and store, or garage, your motorhome in Prince William county and avoid the tax.

[TAZ]

Originally Posted by USMCRET

Stan, the property tax you are referring to is not a state tax. Rather, it is an ad-valorum, or personal property tax levied at the county level. Prince William county in VA does not tax motorhomes. Since the tax is based on where the motorhome is garaged, and not the residence of the owner, you can live in Spotsylvania county as I do, and store, or garage, your motorhome in Prince William county and avoid the tax.

I didn't realize prince William county did not tax MH. I am in Fauquier and we get hit hard. My boat was in prince William and I was hit for personal property tax until I federally documented my boat.

[jfran304]

I don't know how legal this is but I had a neighbor here in GA that registered his coach in Texas under his wife's name so they wouldn't have to pay the ad-valorum taxes.

She was retired so they established a residency in Texas in her name and she got a Texas drivers license.

Jon

[USMCRET]

Here's Prince William County's tax rates: http://www.pwcgov.org/government/dept/finance/Pages/Tax-Rates.aspx

Here's a storage facility I'm familiar with: http://www.hollyacres.net/storage/brochure2010.pdf