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 > Montana LLC to save on sales tax

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Mannon89

Alamo,Texas

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Posted: 11/24/22 02:44pm Link  |  Print  |  Notify Moderator

We are getting ready to buy a new RV we’re wondering if any of you have experience forming a Montana LLC to avoid sales tax. We live in Texas and we understand the state of Texas is not clamping down on such restrictions whereas states like California pretty much will not allow you to do it. My question is how hard is it to do? How long did it take you to get it ready? And is it worth the expense and trouble?
Thanks for the help!


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MitchF150

Puyallup, WA

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Posted: 11/24/22 04:14pm Link  |  Print  |  Notify Moderator

If I were to want to do something like that to avoid such a thing, I'd start with a simple google search with something like "how to setup llc in montana"

You should get lots of results with lots of advice from there..

I'd also guess that if this were something that was a common thing to do, we'd all be doing it... [emoticon]

Anyway, good luck!

Mitch

cptqueeg

Idaho

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Posted: 11/24/22 04:40pm Link  |  Print  |  Notify Moderator

https://biz.sosmt.gov/forms/business

Dtank

USA

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Posted: 11/24/22 05:37pm Link  |  Print  |  Notify Moderator

Mannon89 wrote:

We are getting ready to buy a new RV we’re wondering if any of you have experience forming a Montana LLC to avoid sales tax. We live in Texas and we understand the state of Texas is not clamping down on such restrictions whereas states like California pretty much will not allow you to do it. My question is how hard is it to do? How long did it take you to get it ready? And is it worth the expense and trouble?
Thanks for the help!


At one time LLCs were a common means to avoid sales tax.
HOWEVER - states want their revenue, and began to (legally) pursue folks who were not paying sales tax to the state where they resided.

YES - it was often litigated. Do your homework.

Honest MT law firms will tell you two things:
1. They will *not* represent you in a state other than Montana.
2. They will suggest you become a legal resident of a state with less (or no) sales tax than where you currently reside - (no LLC necessary).
Of course they will set up an LLC for you....for a fee.

When stopped by an LEO, expect to explain why your DL is from a different state than the plates on your RV. Why isn't the owner of the LLC a resident? (Good luck!).

Suggest you look into South Dakota - plan to have both your DL and RV registration from SD......and SD *does* charge sales tax.

Bottom line: There's no free lunch!

[emoticon]

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Second Chance

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Posted: 11/24/22 06:07pm Link  |  Print  |  Notify Moderator

Triple-posted.


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Pbutler97

Midwest

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Posted: 11/25/22 03:44am Link  |  Print  |  Notify Moderator

Dtank wrote:

Mannon89 wrote:

We are getting ready to buy a new RV we’re wondering if any of you have experience forming a Montana LLC to avoid sales tax. We live in Texas and we understand the state of Texas is not clamping down on such restrictions whereas states like California pretty much will not allow you to do it. My question is how hard is it to do? How long did it take you to get it ready? And is it worth the expense and trouble?
Thanks for the help!


At one time LLCs were a common means to avoid sales tax.
HOWEVER - states want their revenue, and began to (legally) pursue folks who were not paying sales tax to the state where they resided.

YES - it was often litigated. Do your homework.

Honest MT law firms will tell you two things:
1. They will *not* represent you in a state other than Montana.
2. They will suggest you become a legal resident of a state with less (or no) sales tax than where you currently reside - (no LLC necessary).
Of course they will set up an LLC for you....for a fee.

When stopped by an LEO, expect to explain why your DL is from a different state than the plates on your RV. Why isn't the owner of the LLC a resident? (Good luck!).

Suggest you look into South Dakota - plan to have both your DL and RV registration from SD......and SD *does* charge sales tax.

Bottom line: There's no free lunch!

[emoticon]

~


Sounds like it borders on tax fraud? Cross your fingers maybe?
Probably not a good question to ask on a public forum by an OP that appears to use his real name in his handle and profile lol?

Tvov

CT

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Posted: 11/25/22 04:55am Link  |  Print  |  Notify Moderator

Pbutler97 wrote:



Sounds like it borders on tax fraud? Cross your fingers maybe?
Probably not a good question to ask on a public forum by an OP that appears to use his real name in his handle and profile lol?


Maybe something has changed, but there used to threads on this forum all the time about creating an LLC or other type of "company" and registering vehicles in different states to avoid various taxes.


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RetiredRealtorRick

St. Augustine Beach, FL

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Posted: 11/25/22 05:04am Link  |  Print  |  Notify Moderator

Just do it the honest way. If you can afford an RV you can afford the sales tax on it.


. . . never confuse education with intelligence, nor motion with progress

midnightsadie

ohio

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Posted: 11/25/22 06:14am Link  |  Print  |  Notify Moderator

x2 you,ll be looking over your shoulder every day for the tax man.

way2roll

Wilmington NC

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Posted: 11/25/22 06:44am Link  |  Print  |  Notify Moderator

We could opine all day on the morals and ethics of such a thing, but morals are usually difficult to enforce legally. But LLC's to avoid paying taxes is under pretty heavy scrutiny, and if you pay attention to the media, it's about to get a lot more attention.

But a few things I would ponder. This topic comes up periodically and I recall about a year ago there was some evidence that states were cracking down on Montana LLC's, even to the point of monitoring forums like this one.
Can you or an attorney can provide defensible answers to questions like; "is there a legitimate business need for your RV under your LLC?", "What is your business and it's purpose?", "Can you evidence why you live in one state and have a need for an LLC in another state and further - that need includes RV ownership?", " For what purpose do you need to have limited liability and how does an RV in another state perform in that liability limitation?", " Why did you open an LLC in Montana when your residence is TX?"

I think most times these LLC's fly under the radar. But if you get audited, be prepared to answer questions like the ones above. And if you can't defend it I am sure there are fines as well as back taxes due.

Lastly I would caution asking the question here. Unless some forum members are attorneys familiar with setting up a MT LLC your answers will be all over the map and hardly legally valid. And asking the question, especially the way you asked it, could draw the wrong attention. After all, you stated your purpose very clearly.

* This post was edited 11/25/22 07:56am by way2roll *


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