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Old 09-20-2011, 05:50 PM   #1
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Question Fulltimer Considerations

So I'm planning on going fulltime within the next six months, and I think I've got most of it figured out, but every time I get one thing under control, there's another question...

I plan to shift my state of residence to South Dakota, as a lot of fulltimers do, partly because RV insurance and tax is lower there. Should I do that _before_ I buy an RV, so that that's taken care of already? Or can I do that at the same time that I'm buying the RV?

My lease runs through March, so I'll be paying for an apartment here in Tennessee until then. Does it make sense to change my official state of residence before then, even if I haven't purchased an RV yet?

I'd love to hear from some of you who are already on the road -- or, well, anyone with a clue on the topic.

Hoping to see some of you on the road soon...

Kate
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Old 09-20-2011, 06:13 PM   #2
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Spend some time gleenging the inforation at Americas-Mailbox Home - mail forwarding - Americas-Mailbox, hopefully this assist your planning.

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Old 09-20-2011, 08:09 PM   #3
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Be sure the seller, your insurance is good with your choices on what state to go with. This is a very specific matter, so do your research diligently. I do not reside in Tn. so I am not qualified to answer. Good luck on the fulltime.
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Old 09-21-2011, 06:47 AM   #4
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Quote:
Originally Posted by OmShanti View Post
So I'm planning on going fulltime within the next six months, and I think I've got most of it figured out, but every time I get one thing under control, there's another question...

I plan to shift my state of residence to South Dakota, as a lot of fulltimers do, partly because RV insurance and tax is lower there. Should I do that _before_ I buy an RV, so that that's taken care of already? Or can I do that at the same time that I'm buying the RV?

My lease runs through March, so I'll be paying for an apartment here in Tennessee until then. Does it make sense to change my official state of residence before then, even if I haven't purchased an RV yet?

I'd love to hear from some of you who are already on the road -- or, well, anyone with a clue on the topic.

Hoping to see some of you on the road soon...

Kate
If you register the new RV in SD, you will save sales tax. I don't know what the rate is in TN, but there the tax on new vehicles in SD is only 3%. However, if you make the purchase too far in advance, you may raise eyebrows in TN, and they may come after you for the tax. If you have a valid lease in TN and mail is still going to that address, and if you still have bank accounts etc. in TN, they may very well still consider you a resident for tax purposes.

IMO, a lot depends on when you want to buy the RV. If you want to buy it sooner rather than later, the cleanest way (not necessarily the cheapest way) is to buy the RV in TN, register it in TN, pay the tax in TN, then transfer the registration when you go full-time. SD will forgive their new vehicle tax if you can show evidence of paying the same of higher tax elsewhere. On the other hand, if you're willing to hold off the purchase of the new RV until closer to the time you hit the road, you can probably save money by just registering it once in SD.
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Old 09-21-2011, 06:55 AM   #5
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We've been fulltime for a little over 3 years now. We also use Alternative Resources. They helped us thru the process.

If you are buying a new RV, it may be a little easier to change residency prior to purchasing. That way is can be registered in SD right away. If you purchase the RV outside of SD, make sure the dealer does the paperwork so that it gets titled in SD, not the state of purchase. You will also pay the 3% excise tax to SD when you register it there.

When you get RV insurance, make sure you get fulltimers insurance. It is a little different due to the fact you use the RV year round. Once residency is setup, you have the fun of changing your address on everything.

But it is worth it. In 3 years, we haven't looked back nor given out decision a second thought.
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Old 09-21-2011, 07:55 AM   #6
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Make sure that you purchase the rig [B]BEFORE[B] you declare that you are full time. Read the link attached as the banks are not wanting to finance full timers.

New federal regulations to limit loans to full-time RVers > RV Daily Report |
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Old 09-21-2011, 08:10 AM   #7
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If you register the new RV in SD, you will save sales tax. I don't know what the rate is in TN, but there the tax on new vehicles in SD is only 3%. However, if you make the purchase too far in advance, you may raise eyebrows in TN, and they may come after you for the tax. If you have a valid lease in TN and mail is still going to that address, and if you still have bank accounts etc. in TN, they may very well still consider you a resident for tax purposes.

IMO, a lot depends on when you want to buy the RV. If you want to buy it sooner rather than later, the cleanest way (not necessarily the cheapest way) is to buy the RV in TN, register it in TN, pay the tax in TN, then transfer the registration when you go full-time. SD will forgive their new vehicle tax if you can show evidence of paying the same of higher tax elsewhere. On the other hand, if you're willing to hold off the purchase of the new RV until closer to the time you hit the road, you can probably save money by just registering it once in SD.
My lease is up in March, so I'll be out of here then, one way or another. I'd like an overlap of maybe a month or two to get the RV ready to go and move into it and such (and let the cats get used to it!).

I'm waiting for the right RV to show up at a price I can afford -- there's a big luck factor there, cos I'm not rich, and when something shows up at a decent price, I'm going to have to jump on it. I guess the questions is, how long of an overlap am I likely to be able to get away with?
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Old 09-22-2011, 06:14 AM   #8
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I guess the questions is, how long of an overlap am I likely to be able to get away with?
That is indeed the big question. SD will welcome you with open arms - it's TN you need to worry about because they are the ones who may come after the sales tax. It is difficult to say what TN will consider to be a reasonable overlap. We tend to be cautious, so we would probably bite the bullet and pay the tax to TN unless the RV purchase was really last minute.
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Old 09-22-2011, 08:21 AM   #9
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That is indeed the big question. SD will welcome you with open arms - it's TN you need to worry about because they are the ones who may come after the sales tax. It is difficult to say what TN will consider to be a reasonable overlap. We tend to be cautious, so we would probably bite the bullet and pay the tax to TN unless the RV purchase was really last minute.
Yeah, and while I'd _love_ a definitive answer on what I could get away with, it is, alas, pretty unlikely! Ahh, well. I shall continue playing everything by ear, and we'll see. Thank you all for your sage advice!

Kate
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Old 09-22-2011, 09:35 AM   #10
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Originally Posted by paz

That is indeed the big question. SD will welcome you with open arms - it's TN you need to worry about because they are the ones who may come after the sales tax. It is difficult to say what TN will consider to be a reasonable overlap. We tend to be cautious, so we would probably bite the bullet and pay the tax to TN unless the RV purchase was really last minute.
I think paz hit it on the head. South Dakota will welcome you anytime, so it all depends on the residency rules in TN. We went from CA to SD (using Alternative Resources) and breaking residence in CA is not easy (they're very strict). We decided to change residency "officially" only when we left CA with the rig....just to be on the safe side. We got new drivers licenses in SD soon thereafter.

There is likely a way to do it earlier but I couldn't tell you for sure. At a minimum you want to make sure there is nothing TN can hold you accountable for in-state. So for example:
- getting a paycheck or SS check in TN
- paying a mortgage in TN
- paying or receiving anything that gets registered to the state
Etc.

Sorry that's not a more definitive answer. Your best bet would probably be to talk to a local tax lawyer in TN about exactly what it takes to break residency.
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Old 09-22-2011, 10:50 AM   #11
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There is likely a way to do it earlier but I couldn't tell you for sure. At a minimum you want to make sure there is nothing TN can hold you accountable for in-state. So for example:
- getting a paycheck or SS check in TN
- paying a mortgage in TN
- paying or receiving anything that gets registered to the state
Etc.
Useful considerations indeed -- thank you! I'm pretty sure TN isn't as bad as CA for breaking residency, but I'm not sure anywhere else _is_, so that's not saying much. At the price I'm likely to pay for an RV (which is to say 'not much', cos that's all I have) it's sounding like the tax savings aren't worth the potential excitement of being caught out with residency.

Thank you all!
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