Montana license

There was a post earlier on Minnesota cracking down on MH with Montana Lic.  Mn just caught another one.  Along with the sales tax penalty the state found he has not paid income tax for 12 years.  He is charged with 13 counts of tax evasion.  He owes $224,000 in taxes and if convicted will face 5yrs in prison plus $10,000 fine for each of the 13 counts---65 yrs and $100,000.  Rumor has it if you drive in Mn with MT plates the highway patrol will stop and look at your drivers lic.

Must be a rumor. I have Montana tags and worked in Rochester, Mn for 2 weeks- and then drove across the state- no problems

Obviously more than meets the eye on this one!!! A reliable source would be good!!!

Have 2 friends in other states that have been caught and had to pay past taxes, fees penalties, etc. No Jail Time. As far as Police stopping Montanan plates that may be true but it's a lot like stopping speeders they get some and some they don't.

A dead giveaway would be a motorhome with Montana plates pulling a toad with Minnesota plates - on a highway in Minnesota.

Remember the oil filter commercial?  "pay me now or pay me later"....

Bet it sucks to have to keep looking over your shoulder.

The reason he got caught was that he was maintaining a residence in Mn. If he'd not had the Mn residence it wouldn't have been an issue I believe. It's not legel in any state I believe to claim residence in 2 states at once, and that's basicaly what he was doing.

State of domicile and state of residence are not necessarily the same thing.  I may own property in a state other than my state of domicile (I do not).  Owning that property does not establish the state of domicile.  The important thing is that the state of domicile is where you license vehicles, acquire your driver's license, pay income tax (if any), and vote.  Doing some of these things in one state and the other things in a different state will likely invite unwanted attention.  Most (all?) states will view any scheme to avoid paying tax to them as a violation of the law.

Residing in a state is prima facie case for domicile there as well. You need a strong preponderance of other evidence to validate a claim of domicile elsewhere. And even if legally domiciled in another state, you are not necessarily exempt from taxes in another state where you also have a presence. 

Many people who run afoul of a state's tax laws have lived in that state for years and continue to do so, yet think they can merely register one or two vehicle elsewhere and avoid taxes.  Some even park the RV in their yard with out of state plates on it and wonder why the local authorities come down on them.  ???

A few years back we had a District Court Judge here in Arkansas who bought a MH and registered it in MT. He got caught. He was prosecuted for tax evasion. He had to pay sales tax and penalty. since it was a felony he lost his job and law license suspended. Even the big shots can get in trouble. 

I have known three people that got busted big time. One of the guys had been doing it for about four years. I would rather pay the taxes .

If you check out websites offering a service to register vehicles in states with no sales tax you will have a better understanding of "legality" of doing so, if it is performed in the context of owning a corporation in that state.  It has long been a practice of large corporations to establish a "shell" home office in those states affording the lowest tax rates...50 years ago many corps. were based in NJ for just this reason. 

An over simplified explanation is:  A corporation is a legal entity, and if that entity is based in a state with a mailing address, and that entity owns vehicles, then those vehicles can be registered in that state, while you the CEO of that corporation can utilize the vehicle in all 50 states, Canada, and Mexico.

CAUTION: Some states have motor vehicle laws specifically against this!  A Montana lawyer will tell you that it must be researched in the state of your residency.

I find it ironic that some states have passed laws have been passed to specify exclude RV ownership from the same opportunity that the 1% use to exempt their big rigs and trailers from the same sort of law.  Watch the plates on big rigs and compare that to the address on the side of the truck, an example is large corporations such as Walmart...do all of their trucks display Arkansas plates?

How many of you are old enough to remember that we did not pay sales tax on labor/services, food and clothing, or used vehicles?  Just more taxation by government that the dollars just seem to disappear, and then they need more.

Food for thought:

Should a used RV be taxed thousands of dollars when sold?  Does the IRS still allow for the exemption of interest paid on an RV when used as a second home?
If so, then the NEW or USED RV, being a second home should be exempt from sales tax just like your home!  What about full-timers were this is their only home?

I am sorry to sound like a ticked-off person, but I am a Veteran who fought to maintain certain liberties.

Then you gotta be a really ticked off person!!!,, cause NO liberties presently exist!!>>>Dan

Interest on RV secured loans still qualify for the 2nd home deduction. So does the sales tax (for 2011 purchases for now) qualify as an alternative to the state income tax deduction. Both have rules and regulations that must be met, see your tax advisor.

As far as sales tax on your home, you are paying it but it is built into the price. Manufacturers and retailers usually have an exception to paying sales tax on purchases used for resale, so materials used by manufacturers is not taxed but the selling price of the product to the consumer is. The RV builder did not pay sales tax on the materials in your RV. The contractor/developer building the home and it's sub contractors all pay sales tax on items purchased for the construction of the house, so the sales tax cost is paid by the builder and passed onto the buyer in the price of the home. This exception probably came about because you don't pay sales tax on the sale of land which is a large component of the sales price of the house.

Question for the experts....  RV registered in Montana. Okay, there was no sales tax because the LLC setup in Montana owns it. Then you sell to yourself in another state for say ten dollars. Is it possible to just pay tax on the sale amount?

I suspect the state would consider that tax evasion and you would end up paying the tax on the full value as well as penalties.  I'm sure our resident accountants will have more information for you.

Most states will charge sales/use tax on the fair market value rather than the listed sales price. Otherwise everybody would be showing up with sales invoices for $10. Exceptions are sometimes made for gifts, inheritances, etc. though. And sometimes a used vehicle more than x months/years old is exempt when brought into a state.  Check with the DMV and tax authorities in the state where you will register it. There are just too many variations to cover them all here.

If you can it might be better off to sell it to yourself in MT, wait 90 days, and then transfer it to the state you are thinking of.


In some states that does not work anyway. SD charges 3% less credit  for any tax you have paid elsewhere so you will end up with a 3% tax bill on fair market value.

When you buy any motor vehicle in Ma you have to pay the sales tax within 30 days even if you don't register it. We use to use our owner repair plates, never had to register it or pay the sales tax, until someone made a call