Montana registration crack-down

Okay...Atlanta, GA chiming in here.

Here's what's happened (in my opinon). We had normal Ad Valorem tax. You'd pay your tag free and a percentage of the slowly depreciating value, until 25 years, then it's a flat fee (IIRC). Old ad valorem cars (stuff you owned before the change) are grandfathered in. I have two like this. The tax on a 1957 and 1971 cars are $20 or $10 or something...plus tag fee. On an E46 BMW in the mid-late 2000s, it was 325/year, then 282/year, then 215, then 200, then 188...etc...and EVERYONE complained.

Then a few years ago (2013), the rule changed. It's now a TAVT (Title Ad Valorem Tax) ( https://dor.georgia.gov/tavt-calculator ) Now they grab 7.5% right right off the top when you buy. New or used. Doesn't matter. On top of that, it's on what they THINK it's worth. So let's say you buy a '63 corvette (this happened to a friend of mine), for...$20k, and it's kinda beat, but good restoration candidate. The tax chart says nope, it's worth 45k, and you pay on 45k. You CAN file a re-consideration of value though. A friend just bought a pretty rough SL 500 for $1800, and they charged him on $7300 in valuation...his bill was $550!

So I buy a car, and title it, and pay $2000, then sell it to you a month later...you pay $2000 too, or if they think the value has increased, $2100. Or if you show them the bill of sale, and it's higher than the estimated valuation, whatever 7.5% of that number is. So if you're not going to keep the car long, where you would have been out $2500/year (or whatever) on your lambo, you're out $20000-30000 right off the top, you're gonna be pissed....especially if you're not holding it for very long.

Now, because it's a TAVT (Title Ad Valorem Tax), you can STILL deduct ad valorem on your taxes. You just have to remember to do it in one shot, in the year you purchased the car, not every year like you had in the past. Even worse, certain tax programs (if you do them yourself), don't necessarily make it obvious that this works, because they're programmed for states that pay yearly.

As if all of that weren't enough, if you TRANSFER a title into the state, you pay 7.5% the first time you register you car. I know people who've politely turned the tag office down, drove to a dealer, and traded in for something newer with the 7.5% rolled in to the payment.

When I did the 348, i had the cash set aside, the number was still pretty shocking, and the lady says "Oh we have tesla buyers come in and their bill is $5900" At the same time, I overheard the next window asking if they could arrange payments...it's f'd up.

sjd

 

FYI I called a co. in Montana and if I wait till Jan to register my ferrari f430 it will be 11 years old and I can get forever ( never expire ! ) plates for $500 but as the original MSRP was over 150 K $ i'd have to pay a one time $850 luxury tax so, after 2 years , I'd have broken even w/ registering in AZ and annual plates will be 0 $ !! so save $600+ AS for insurance ? I asked ! Haggarty has NO issue w/ the car being titled / registered in Montana as long as I am the only one on the LLC! As they said, it IS legal ! ( and no AZ annual emissions test ! handy for those w/ modified exhausts !! some poor guys need to put the stock cats, exhausts back on some cars ! ) do CA owners have an issue w/ that ?

 

You are right, no problem at all. When the insurance company denies the claim you just tell them that someone you talked to on the phone last year said you were covered. As any lawyer will tell you, an oral statement isn't worth the paper it's not printed on.

 

Insurance companies rate the car at the garaging address regardess of where purchased or registered. Many companies send their insureds an annual questionaire asking this and related information relative to the driving and use of the vehicle.

 

correct. but previously you paid no taxes up front when you purchased a car private party. just the yearly ad valorem. this whole system is a screw job and a back pocket favor to dealers

i've NEVER seen a system where one moves into a state. has existing cars and has to pay another 7-8-9% to get a GA title when they already have a valid title in their name.

you are better off buying a new car once you come here. you should be able to use your current car )old state title) as a trade in and tax offset to purchase a new one.

 

But that can work both ways. I bought my manual 360 in 2015 for just under $85K. My one-time registration fee was only $2,245. Why? According to the state charts, the car was valued at only $32K, or roughly one third of the true market value.

Now I only pay the $20 annual tag fee. In the pre-2013 days, I would have to pay the dealership a 7% sales tax on the purchase price, or around $6K. Additionally, I would get billed several hundred dollar annually for the ad-valorem tax, plus the $20 tag fee.

So in my case, the TAVT scheme saved me around $4K on the Ferrari purchase. I am not complaining.

 

Something just occurred to me. On this forum and some other exotic car forums I've read about owners receiving very disparaging/rude comments or outright vandalism to their vehicle. Meanwhile many long term owners have never experienced such problems. I'm wondering how many of those incidents were a result of those actors knowing that neither the owner nor the vehicle has never been in the state where it is registered.

Just thinking aloud.

 

Yep, it's ridiculous. My friend and his wife had to do that when they moved to ATL recently when she got a job at Emory. I was considering going for a job at Emory's hospital, but passed as it is one of several reasons I don't want to deal with that place (mainly job specific reasons, but things like the car just make it not worth it).

 

Goodness! such cynicism! well I did work for w/ an attorney some years ago when i was in law enforcement ! and he did always say get it in writing and a good suggestion, so I shall! thx ! But, this IS Haggarty a company considered a collector's best friend! No argument, No hassle if it's totaled ? a check for the agreed value amount w/ in a week! I have two cars insured w/ them, the F430 for $20 K more than I paid for it ! PS they do take notes on a phone call and she consulted a supervisor to confirm !

 

Well mayhaps! But recall correlation does not mean causation! I think that is a bit of a stretch! near to veering off the rails ! Sad fact is , ne'er do wells, cretins and jealous mentally deficient morons will do vandalism for a plethora of unfathomable reasons , bizarre justifications! I have Zero deductible, agreed value insurance and refuse to worry ! don't have to ! The other owners were just lucky ! it's fate ! A statistical anomaly ! IMHO It is intriguing the extent chaps will go to argue against the " Montana solution! "

 

Welcome to Kentucky, open your wallet.

I moved there in 1996, with a 1991 Celica worth $5k. The tag was $480, and I had to prove I'd paid sales tax in Florida (5 yrs prior), otherwise I'd owe an additional 6% to Kentucky. Sounded like a scam, but fortunately I still had the original paperwork in the glove box.

My mom's Audi was a $5500 license plate. Every freaking yr (with a miniscule per-year depreciation reduction.) She finally sold the car because she couldn't afford the tag after 4-5 years.

Eventually I moved back to Florida. $35 tags and no more state income tax. Screw you, Kentucky.

 

neil e dale - just a word of advice - feel free to disregard.

You are asking the wrong question as best I can tell. Of course its "legal" to register a car in MT in the name of an LLC (or not). That is not in doubt.

Its the laws of AZ that you need to be asking about. I have researched them a fair bit as I have a home in AZ as well as in other states...AZ has pretty clear laws on when (and when not) a car has to be registered (and taxed, both sales and annual fee) in AZ. That is the only law that using the MT maneuver might violate. And, of course, then you have to get caught. AZ is not (yet) CA in terms of policing plates on the steets.

 

Government taxing you out of the wazoo and not improving your life. Lame.

 

Then change the laws or your politicians in your state.

 

It sounds a bit like railing against the sun rising in the east

 

Yes, we know we live in AZ ! of course, the snowbirds come here every winter and bring their cars too ! ( out of state registered, & plates ) yes, every state tries to get you to register your car there if you are a resident of that state or are there X # of days . Funny ! one of the Montana LLC places had a link to a page suggesting one could easily get a legal residence in Where? Amazing what folks will go thru to avoid taxes, guess it makes sense for full time, RV'ers : ..........
..........".To claim residency in South Dakota, you only have to stay one night every 5 years in South Dakota. !! You have to show up and go to the local licensing office, preferably in the county where you hired the mail forwarding service. You’ll have to bring all the normal things like current drivers license, Social Security card, passport, etc.
After you have a South Dakota drivers license, it’s pretty easy. You just don’t have a personal state income tax to file with South Dakota."

 

That’s correct , until it isn’t.

 

Easier said than done ! we do live in a democracy tho ! ( allegedly !)

 

sounds like many wish it wasn't legal!................................................................. I've heard of the affluent snowbirds now having cars registered, kept in different states just to avoid the hassle/harassment of getting titled, licensed! ......................................... we always dreaded their arrival every fall/ winter as they clogged up the roads here in AZ and were terrible drivers! = lots of accidents! not so many here nowdays ! wonder where else they have gone ?

 

well, the affluent, ( many on here ? ) doubtless take advantage of every legal tax loophole /, dodge they can when it is income, investment, inheritance taxes so is it not just a bit disingenuous to criticize avoiding a sales tax, exorbitant license fee for a car ? as Bill S said "To thine own self be true," !

 

They all came to Sarasota bro. Lol

 

meanwhile apple and google funnel billions thru ireland and other ****holes.....

 

Trillions

 

And breaking news............Montana now has a waiver issued by the Highway Patrol that allows no front license plate required if there is no aftermarket mounting assembly available. I am meeting with them in the next week or two to see if I can qualify. But........they do need to see the car. I have been driving with no front plate for about 30 years!!!!!!!