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Old 03-09-2018, 09:47 PM   #1
FlyingAroundRV
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Where is sales tax levied?

In May/June we are coming to the US to purchase a new Outback TT and a pickup to tow it with.
WRT purchasing the TV, I have read some stories of dodgy car yards charging interstate buyers the sales tax on their vehicle, but not actually paying it to the buyer's home state. This didn't become apparent until the buyer got home and had to pay the sales tax (again) to get the vehicle registered.

My question is this:

We will likely be purchasing the TV in TX, but it will be registered in MT. As most would know, many counties in MT don't charge sales tax. But where do I stand if a TX dealer comes out with "We have to charge TX sales tax"? Is it correct? Or is it a ploy to fraudulently raid my wallet as I read somewhere else?
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Old 03-10-2018, 12:11 AM   #2
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I would say in simplest terms, 'it depends'. Typically in my state, they charge sales tax based on your home location. While that sounds confusing, different cities/areas have their own sales tax on top of the state sales tax. Texas has this type of varying sales tax locations, base is 6.25% with some locations having a 2% additional fee.

Since you mentioned Texas, there is a Sales Tax exemption form, so if you are listed as a out of state resident, which you should be, you are exempt from Texas sales tax. Here is a link to the webpage for that form: https://search.comptroller.texas.gov...hicle+purchase

Montana is a well known, no sales tax state, and many people list it as their place of residence - but make sure you meet those residency requirements, and as non-US citizens, it might have other implications, but we'll assume you know and have research those items.

Enjoy the site seeing!
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Old 03-10-2018, 03:28 AM   #3
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Flying, here is a small article pertaining to your little dilemma. People who live in one state, but license their RV's in another state to avoid the sales tax are generally referred to as cheaters. California actually calls their law pertaining to this little problem as their "CHEATER" law. I remember visiting Australia in about 2005 for almost a month. I paid tourist taxes at every hotel, every restaurant, every car rental and tourist trap we visited. We were glad to do it. But the country won't run itself. A small thing like sales and use tax greases those wheels.
https://www1.avalara.com/us/en/blog/...wednesday.html
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Old 03-10-2018, 08:08 AM   #4
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I buy my vehicles in TX and register them in NM generally. I do it because the sales tax there is less than 1/2 of TX and I've owned a residence/property there for 23 years. I tell them that is what I'm doing, give them my address and they find the nearest tax collection office to that. You need to be aware that getting the physical tags/registration in your hands can be problematic at times and take quite some time.....up to two months or more.
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Old 03-10-2018, 09:49 AM   #5
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We live in Kansas bought our truck in Iowa and the Camper in Missouri. In both cases, the dealership didn't charge us any sales tax. We had to pay the sales tax when I registered the vehicles.

I wouldn't think you'd have a problem with any reputable dealer.

To add another twist, we store the camper in another county, about 60 miles from where we live. We registered it there and saved about $100 in sales tax.
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Old 03-10-2018, 10:56 AM   #6
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The choice of registering our vehicles in MT wasn't just a tax fiddle. As non US residents, we need a US address to register the vehicles to and so we set up an LLC in MT to own the vehicles. This was primarily convenience as the companies that set these things up advertise on the net, but also we have some friends nearby who have done it this way so we went with that. The tax side of things was just an added incentive for us to do that.
My original question was probably badly worded.
We won't be relying on the dealer to do the registration. That is all done by our LLC agents in MT, who claim to be able to have the tags in our hands within a few days via courier delivery.
But what I was really asking is if a dealer tells me I have to pay TX sales tax or other state taxes in TX too, is he right or not?

As for being "tax cheats" we will be buying a lot of gas along our travels and paying a lot of fuel taxes on that, plus whatever supplies, camping fees, food etc we will buy will no doubt attract state sales taxes etc on all of that. And that is all I have to say about that.
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Old 03-10-2018, 04:19 PM   #7
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Quote:
Originally Posted by FlyingAroundRV View Post
The choice of registering our vehicles in MT wasn't just a tax fiddle. As non US residents, we need a US address to register the vehicles to and so we set up an LLC in MT to own the vehicles. This was primarily convenience as the companies that set these things up advertise on the net, but also we have some friends nearby who have done it this way so we went with that. The tax side of things was just an added incentive for us to do that.
My original question was probably badly worded.
We won't be relying on the dealer to do the registration. That is all done by our LLC agents in MT, who claim to be able to have the tags in our hands within a few days via courier delivery.
But what I was really asking is if a dealer tells me I have to pay TX sales tax or other state taxes in TX too, is he right or not?

As for being "tax cheats" we will be buying a lot of gas along our travels and paying a lot of fuel taxes on that, plus whatever supplies, camping fees, food etc we will buy will no doubt attract state sales taxes etc on all of that. And that is all I have to say about that.
You won't have to pay TX taxes and then MT. If it works for you like it does with us, they will give you a dealer tag good for about 2 months (now - used to be 30 days) along with the paperwork required to register it if they aren't going to. You will need to get the paperwork to whoever collects taxes and registers vehicles in the place you are going and have the tags on it before the temp tags expire.
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