Montana registration crack-down

Sorry, that is simply a flawed analogy.

Back then the state laws where you resided most likely did not require sales tax on internet delivered items. So people were following their states‘ laws. Now the laws have changed in most states and people again follow the law and pay sales tax.

OTOH, the Montana corp is NOT following the law of your state in many states (CA being but one such state) for most people. (There are some that have legitimate business purposes and or meet the specifics of their state laws).

(whether one gets away with it or not is another topic that often gets mixed in here)

(whether one sees the risk worth taking and justified it to themselves and others as “doing my thing to minimize taxes” is also another topic that gets mixed in here)

 

I agree with arizonaitalian. There are a lot of different concepts that are getting muddled together here, intentionally by some IMHO to muddy the waters and to justify the unjustifiable.

The bottom line, tax “avoidance” is legal and part of our economic system used to encourage certain behavior in order to accomplish social goals. For example, accelerated depreciation to encourage the purchase of capital assets and the creation of jobs or even the offer of billions in tax deferments, credits and rebates to get Amazon to locate in NY (which AOC managed to scuttle to the horror of most including the most liberal of NY Democrats). So the example of Bezos “avoiding” taxes and structuring his affairs accordingly is exactly what society wants him to do and is a total red herring. That is tax “avoidance”.

Tax “evasion” is simply criminal behavior. It is having the fake Montana registration, it is cheating on your income taxes, it is robbing the state or federal treasury. There is no benefit to any one from that behavior other than the tax cheat. So all the arguments about there are “constitutional issues”, “taxes are unfair”, “taxes are too high”, “I work too hard for my money”, etc. are just a load of crap that tax cheats float because they don't want the social stigma of having to admit that they are tax cheats. The arguments certainly are not for the purpose of actually convincing a judge since they are totally lame from a “legal” perspective (as davemqv eloquently pointed out in his monologue of a cheat arguing before a judge).

Remember in Alice’s Restaurant where all the mother rapers and father rapers moved away from the guy charged with littering? Tax cheats are worried that everyone will view them like litters and take 2 steps back.

 

It is not flawed whatsoever. Main purpose if one owns an exotic in setting up a MT LLC is to avoid the huge expense of sales tax levied on purchase. State laws as far back as I recall were to voluntarily pay your state's sales tax on out of state merchandise purchases (e.g. books, TVs, and anything else). This is way before the current reciprocity law between most of the states.

 

Well again, every state has its own laws so I can only speak for Massachusetts. Here if you buy something out of state that would be taxable in this state then you may owe sales tax (actually called "Use Tax"). Three quick examples -

1. When I bought my 612 out of state I paid 6% sales tax to that state and then .25% Use Tax to MA since our sales tax is 6.25%.

2. Last year in Italy my wife bought expensive luggage. The value added tax was 22%, therefore no tax would be due to MA. I didn't bother to get some of the tax back, but even if I did the amount of tax paid would have exceeded MA sales tax.

3. My wife occasionally buys shoes and clothes online. She will pay any sales tax an out of state retailer charges, but there is no sales tax on clothes in MA (with exceptions) so nothing is due to MA.

 

I think Federal and State budgets and tax revenue should not be mixed up and are not comparable. The Federal budget is the only way to introduce new US dollars into the system and that's through deficit spending. There's no other way as the Fed does loans (temporary via money multiplier and deposits) rather than actual dollar creation/spending. The national debt is the amount of dollars the US govt created over time to grow with the economy (which can be multiplied via money multiplier from fractional reserve banking when it eventually gets to a bank after being spent). If that grows faster than the economy, it causes inflation and vice versa. Federal taxation is only needed to keep inflation in check by reducing the dollars in circulation. The Federal government doesn't actually need the money back as it can print more at anytime it wants. To pay off the entire "national debt" would require recall of all dollars ever created, which would collapse the economy.

Now States and households don't work like that. They can't create currency out of thin air and that's not their job. They need a "balanced" budget otherwise they are actually screwed. I don't blame them for going after what they deem taxable...they can't get it any other way unless I suppose they ask for a grant from the Federal government...

That post was probably way beyond anything this thread needed, but just thought this entire tax debate needed some different perspective...

 

I love how this thread has devolved into what we "feel tax law should be like". I personally like a flat tax across the board, so everyone pays...

FWIW If have a LaFerrari in the future, I'm only going to do what many owners do, drive it on tracks and private roads only. If you use a public utility (like roads and highways) you should pay to use it like everyone else.

 

Ron H
your the man
you nailed it dude
as we say in the fighter world
SH

 

here is the bottom line
you get stopped by the police
your car has out of state plates and your driver license is not from the state that matches the plates and your not just passing through or visiting
impound the car
give the person 24 hours to pay the fines and fees
if not
crush the car!
give them back the keys!
do this a couple of times
and the scam will stop

 

No issue with this but how much is enough? After all LAF doesn't use anymore resources than a Total Corolla, in fact much less as it is rarely if ever on a public road.

 

This might be the stupidest post in this entire thread. So someone owns multiple homes in different states but resides mainly in one. When he travels to his other homes and uses his other cars he will have a DL from his home state. So now his car gets crushed? Dumb dumb dumb

 

Two points:

1. Various states have at least one employee who does a Google search for "Montana LLC" every morning. Because this thread is not in the subscribed area, I'm positive it is being monitored.

2. If you don't like the tax in your state, you need to start lobbying your state politicians.

 

Good luck with this. FT job that will yield no results.

 

I guess about as much good as complaining on Ferrari Chat.

 

True

 

That's just stupid we are the 50 United States.
I had NC tags on my cars when I lived in NC for work but I had a Mi license as I was still a resident of MI
SO when I go back to MI for an extended period and got pulled over they should take my car fine me and or crush the car?

I'm currently in Wyoming driving on Mi license with Wyoming tags.

All this **** is states crying over ******** taxes


So weird though have you ever noticed all these Semi trailers that have Maine tags on them? I wonder what that's all about couldn't be some kind of scam as some here call the Montana tag scam.
If one owns a LLC and can tag vehicles or trailers in that state that state has made the determination that they can do that, you don't need to have your license in that state and that car doesn't have to reside in Montana or Maine we are free to roam this entire country as we please last time I checked.

 

Incorrect, and I'll give you a real example.

In Massachusetts there is an excise tax on all alcohol products. It is paid by the distributor and added into the retail price. So for example a $40 jug of Jack Daniels includes $2 in excise tax. Alcohol was not subject to sales tax, but then the state did include it as taxable.

This added insult to injury because then we were paying sales tax on the already included excise tax. A motion to repeal was put on the ballot in 2010 and the sales tax on alcohol was repealed.

And one other example. Many years ago the voters approved Proposition 2 1/2. This limited the yearly increase in property taxes to 2.5% unless the city/town voted to override the limit.

So you can roll back taxes, it's just harder than cheating.

 

Once again, the states are making the argument they can ignore the legal wrapper of a LLC that owns a sole asset - namely the car sitting in your garage.

 

This is absolutely correct. It has long been known that they do this with the motor home crowd and no doubt they also do it with the Ferrari crowd. Low hanging fruit with a big financial pay off.

Here is an old newspaper article about Colorado going after a bunch of motor home owners with Montana plates.

https://urldefense.com/v3/__https://www.denverpost.com/2008/05/21/rv-owners-who-registered-in-montana-convicted-for-tax-evasion/__;!!DUT_TFPxUQ!W_MvriMabtChd5W8-Sib8KNkbiTVOUPmtfitl9tmlOXi_XiXWMsjKjSr8icVmA$

Note it says: “The Colorado Attorney General’s Office and the revenue department working together obtained misdemeanor tax evasion convictions against 12 people.” In addition it says “The state billed 122 recreational vehicle owners $2.7 million in unpaid sales taxes, penalties and interest.“

So Colorado got 134 motor home people in one fell swoop with 12 criminal convictions and lots of fines and penalties in addition to the tax owed. As Texas Forever said, probably some state is watching Ferrari Chat right now gearing up to do the same thing. Of course there will be those among us that will vociferously argue that a Ferrari is “constitutionally” different than a motor home or that a Ferrari owner is more “morally” entitled to cheat on taxes because they make more money than a motor home owner. Obviously extremely relevant arguments that will have the taxing authorities quaking in their boots.

 

And don't forget the community service. Maybe they had to wash State vehicles!

 

All the interstate semis I see have apportioned plates, meaning they pay a portion to each state they frequent. I think it is pretty tough for them to get away with not apportioning because state police are always checking these vehicles, and then there are the weigh stations.

 

In VA people have tried for years but no results. There was some BS relief bill passed but it's still excessive. Values are based on NADA which are high, you can argue your point but linely to be declined. Years ago I was told my Escalade was appreciating. When I inquired they acknowledged it was odd but no correction. F them.

I dont have Montana plates, never have. Just sharing my thoughts and experiences. When I see someone with Montana plates I just think good for them. It doesn't bother me in the least.

 

I had my CDL for a short period.
There's no getting away with it

The trailers are not apportioned the truck is even if it's a pick up truck doing trucking. But the trailer is just tagged wherever.

It's all about fuel taxes and you pay for every state you drive through or may drive through.

That doesn't change the fact that a lot of trailers are tagged in Maine.

 

Well I certainly agree that is wrong, but I bet it is an anomaly. In MA they use the MSRP base price (options not included) for that model car. The excise tax rate drops each year until the 5th year and then remains constant. So there is no unfairness in assessing the value of the car.

Back in 2001 when we bought my wife's Jag S-Type they valued it at the base price of the V8 instead of the V6 which she had. I think it was about a $4000 difference. I simply went to Town Hall with the proof it was a V6 and it was corrected.

 

Nicely said

 

Love it !