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Montana registration crack-down

Discussion in 'Ferrari Discussion (not model specific)' started by Terence Courtnage, Oct 25, 2018.

  1. RonH

    RonH Formula Junior
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    #751 RonH, Oct 29, 2020
    Last edited: Oct 29, 2020
    That avoids sales tax fraud but it doesn't avoid the California failure to register laws, annual registration fees and the compliance with smog laws, assuming you don't also leave the car in Montana. California law says that you have to register the car within 20 days of entry into California. So technically fines and penalties can still come your way (which a friend of mine just got caught for and had to pay and were very biggly-as the Donald would say).

    I suspect you are also outing yourself with the state in terms of where the car is located and I am sure that no good deed will go unpunished.
     
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  3. PA32Pilot

    PA32Pilot Formula Junior
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    I just eliminated their main focus which was tax evasion. I paid my taxes.
     
  4. RonH

    RonH Formula Junior
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    #753 RonH, Oct 29, 2020
    Last edited: Oct 29, 2020
    One of their focuses. They are bureaucrats and they focus on everything. Go ask my friend who thought he was ok. Not so much.

    He got caught when he went to sell the car and they investigated the history. Perhaps if you sold to an out of state buyer, but a lot of gymnastics there and overall life is too short.
     
  5. Id have to agree that in California I have seen cops pull you over for those plates and with the emission and loud exhaust being a big deal. I’d not to do it.
    Now in Miami where we also reside I never seem so many friendly cops who tolerate speeding and so many exotics with Montana license plates ! Oh well great thread!


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  6. RonH

    RonH Formula Junior
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    I have to agree. I live in Southern California but, until the pandemic, I spent a lot of time in Boca as well. Night and day difference in enforcement and the attitudes of the cops.
     
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  8. Fiat2Ferrari

    Fiat2Ferrari Karting

    Nov 2, 2013
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    Was driving down 93 not too long ago and I just glanced over and down (I was in a truck) and saw a Gallardo. Thought about it and started noticing all the other interesting cars in NW Montana...there are a few. Never once thought of titling mine there even though we have a residence. I'd rather pay the Illinois tax than have to explain why I have Montana plates on my vehicle.
     
  9. Gh21631

    Gh21631 F1 Veteran
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    In florida you will get run over if you arent going 80mph on the highway
     
  10. drcollie

    drcollie Karting

    Dec 15, 2013
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    In Virginia, we pay a 4.3 % sales tax on purchase of a vehicle, then 4.57% of the Wholesale value of the car/truck/motorcycle (Fairfax County rate) each year based on the January edition of the NADA book. Interestingly enough boats and aircraft are not taxed. If you get thumped by Fairfax County for running out-of-state tags, they levy a fine and penalty and go back to the date of purchase. The Test? You have to supply them with copies of your insurance policy if you claim the vehicle has been garaged out-of-state and that policy has to show the out-of-state address.
     
  11. RonH

    RonH Formula Junior
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    #759 RonH, Nov 8, 2020
    Last edited: Nov 8, 2020
    Exactly. Of course if you are a “brilliant” fraudster you will have thought of that and the car will be owned by a Montana LLC with a Montana address. But if they had read this old Jalopnik article then they would realize that they are risking invalidating their insurance using a fake address:

    https://jalopnik.com/the-pitfalls-of-the-montana-license-plate-scam-1711216059

    The article at post 50 (which I have reprinted below) really shows how, no matter how “bright” these fraudsters are, the local authorities can pretty easily see through it:



    As a piece of social commentary, one would think someone who was well off enough to own a Ferrari would be bright enough not to risk fines, penalties, jail time and invalidating insurance over a few tax dollars, especially by driving around an expensive and often rare car with out of state Montana plates that screams “look at me”. If they were really bright” they would have figured out it is much less visible and much more lucrative to simply cheat on their income taxes. But obviously just because you have money, that doesn’t make you the sharpest tool in the shed.
     
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  13. Preston Joslin

    Feb 14, 2019
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    Just saw this. As stated, Montana isn't necessarily the problem, your home state is. Of course there have been people fined and charged, but the general consensus is "they'll crackdown on everyone but me" here in Indiana. Not many are very concerned here about it. Me? I don't see the point of avoiding taxes on a car unless you're in LaFerrari or Veyron pricing. It all comes down to this: if you want to try to save a few bucks and are prepared for the risk, do it. But know it's coming at a risk. And, if that risk happens to become your reality don't complain about it.
     
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  14. drcollie

    drcollie Karting

    Dec 15, 2013
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    What happens here in Virginia is the State and County don't really do anything until a neighbor rats you out and files an on-line complaint, which has to be pretty detailed on their part. If you live on acreage where they can't get close to your cars or keep your exotics in a warehouse away from neighbor's eyes you will probably never get caught. But the guy that has his Ferrari or Porsche with Montana tags in a more typical neighborhood that is on quarter or half acre lots, he's going to get pinged by the guy a couple doors down who is stuck driving a 15-year-old BMW because he has two kids in college and that's all he can afford. And once he reports you, the County follows up - then it's pay up time, with penalties and interest.
     
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  15. ChipG

    ChipG Formula 3

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    Florida is one of the few states that does not charge property tax on cars so why would they care?
     
  16. It’s still illegal


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  17. ChipG

    ChipG Formula 3

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    but not tax evasion illegal since FL does not charge a property tax.
     
  18. jessedh

    jessedh Rookie

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    This was an interesting thread and thought I would throw a question out there that should get some lively responses.

    Would it be illegal to purchase a car using a Montana LLC and then quickly use it as a trade-in in your home state where normally you don't pay sales tax on the value of the trade in . If you did this in under 30 days, would it technically be legal?
     
  19. RonH

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    Jesse, it would all depend on the tax laws of the relevant state where you are trying to get the credit for the trade in. However, here is how I would approach it from a logical (but not necessarily relevant) standpoint.

    The trade in tax credit is presumably in recognition that you already paid sales tax in the state on the vehicle you are trading in. Since you didn’t then logically you shouldn’t get the tax credit. How would they determine this? Well if it was registered in the state then you would have paid sales tax when it was registered. If it is not registered then you wouldn’t. So you may find that you only get the trade in credit for trade ins that are registered in the state. Just my guess.
     
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  20. INRange

    INRange F1 Rookie
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    Exactly. Add to that in order to get the credit you actually have to prove what you paid in Sales tax and when. Some States only extend the credit to cars owned (titled) by actual persons not Corporations.
     
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  21. Texas Forever

    Texas Forever Four Time F1 World Champ
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    Yes, in Texas, and most other states, you only get the sales tax credit on a trade in if you paid sales tax in another state.

    Now, there is one little loophole. You don't have to had paid the same amount of sales tax. Say State X charges 4% and Texas is 6%. Texas will give you a 6% credit.
     
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  22. Nospinzone

    Nospinzone F1 Veteran

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    Not to mention you buy a fair retail $225,000 Lusso to trade in on a new $400,000 488 Pista and the dealer is going to give you what, $190,000? So in Massachusetts you'd save $12,000 in sales tax with a depreciation cost of $35,000. I hate paying sales tax, but not that much! :D
     
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  23. wthensler

    wthensler Formula Junior
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    FL requires the vehicle to have been registered in another state for a minimum six months to avoid the 6% state tax.
     
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  24. Preston Joslin

    Feb 14, 2019
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    On a side note, who wants to join me in destroying all of the Ghibli's in the world?
     

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