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Old 03-02-2021, 05:16 PM   #1
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Thumbs up How Sales tax works on RV purchased

Sales Tax and DMV Registration are based on "Where the Vehicle will be Kept". SO if you Live in one of the highest taxed Cities in Los Angeles with a 10.25% Sales tax but store your RV in a low tax county like a city in Ventura or Kern counties where the sales tax rate is only 7.25% could save you lots of money.
Example if you register a big Diesel Pusher that you paid $200,000 for the difference in sales tax is $6000 between Ventura 7.25% County area vs. LA with 10.25% tax rate.
So check out the state Sales tax web site first at CDTFA and check tax rates by county. See if you can find a storage location in a low tax rate area first. Most people in LA can't fit an RV where they live anyways so its worth it to check this out.
Also Did you use/own or plan to use/own your RV 51% of the time outside of California during the first 12 months of ownership. If so then you should have operated on the out of state plates for the first year. After one year of ownership then no California tax would be due at all.
One popular option for people planning Full time or heavy use of an RV during the first year is to Register it in Montana. You might think that you don't have an address in in the state of Montana but if you own an RV you can drive it up to Yellowstone park. Stare at the Bison and Geysers and then drive up to a campground in Montana. So if you are staying at a campground in Montana then yes you do have a current address in Montana and can then go over to the Montana DMV and use that address to register your RV. States that don't have sales tax include Montana, Alaska, Oregon, but they might expect you to have your drivers license in that state. But you can do a Statement of facts stating that your 2nd home is in that zero tax state and your primary home is in another state and they should likely accept that. Or you can register your RV in a business or trust name and that might help.
Generally if you are using and or keeping your RV physically outside your home state 51% of the time during the first year then you can register it anywhere you want.
IF you are a cash in full buyer of your RV this is likely simple to do. If you are financing your RV then the bank as a 3rd party might stipulate that you must register in your home state so check tax rates for different locations because that could offer massive cost savings.
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Old 03-02-2021, 07:18 PM   #2
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Geeze you made my head spin. At least one good thing about NJ, no crazy county differences in sales tax. You pay the state sales tax when you get title, done. Sounds like the CA system opens door to all sorts of fraud.
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Old 03-02-2021, 08:03 PM   #3
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Massachusetts doesn’t have county tax rate, flat 6.25% as soon as you go to the DMV. They don’t care where you bought your vehicle either. You want to register it in Massachusetts 6.25% thank you very much. Plus we have an excise tax as well. We pay that every year. 25% per 1000 but they have a crazy way of figuring that out. It drops every year as the vehicle value drops.
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Old 03-02-2021, 08:24 PM   #4
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No sales tax in Alaska, but many areas have a Biennial Motor Vehicle Tax according to age of the motor vehicle. Non-commercial trailers including TT's & 5er's are eligible for one time permanent registration fee "Z" tab. Unless you are active duty military or a out of state college student attending college in Alaska you will have to obtain both vehicle registration and driver's license if you claim an Alaska residency. The application for title/registration asks for that information.
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Old 03-02-2021, 08:25 PM   #5
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No Sales tax here on Oregon and registration is 2 years and still far less than California for one year.
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Old 03-02-2021, 09:25 PM   #6
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No sales tax in Alaska and no third party VIN verification needed. I paid $90 for everything, and that includes title and permanent registration that never needs renewal. So I'm done with DMV for as long as I own this trailer.
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Old 03-03-2021, 09:54 AM   #7
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DMV Fees are In addition to Sales tax

So there are 2 fees to worry about....
In California they call it Sales/Use tax so for example..
This a charge assessed against the purchase price.
so if you live in Los Angeles County some city charge at a rate of 10.25%.
Sales tax is set and approved by voters in elections.
but tax is only charged against a purchase.


each year in addition the DMV charges Annual Registration fees.
Some years back our Governor was Grey Davis and he had approved the increase of vehicle registration fees about 2.2% each year.
He got Recalled and Arnold Schwarzenegger became Governor and reduced the car Registration tax to under 1%.
Back in 2017 Governor Brown increased the car registration fees again.
SO if you buy an RV in a 10.25% city/county sales tax area then you could end up paying 13% in Governmental fees combined at purchase and then the DMV registration again each year in California.


California has a way around this if you buy an RV.
here is an example:
If you are a able to buy your RV in Full and you want to buy from a California Dealer this is the way to avoid tax..


At time of sale the dealer can drive the RV under dealership control outside of the state across the state line to someplace like Phoenix, Las Vegas are any nearby city that is outside of California. Once the dealer has driven the RV across state lines the nature of the transaction changes from a retail transaction to an interstate commerce transaction.
You the buyer and the dealer rep need to visit a Notary to sign a California tax form CDTFA-448.
The Notary provides 3rd party verification that the dealer appeared outside of California. The dealer can accept and retain this completed form instead of the tax money.
then you the buyer can go register in Montana or somewhere much cheaper. If you the buyer keep documents that the RV was outside of California 51% for the first year then you will not have to pay tax to California even if you were challenged by state tax audit.


The state publishes a manual for Auto dealers to understand the complexity. but anyone can download and read it.


Publication 34, Motor Vehicle Dealers - CDTFA - CA.gov

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Old 03-03-2021, 02:49 PM   #8
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Quote:
Originally Posted by AlaskaErik View Post
No sales tax in Alaska and no third party VIN verification needed. I paid $90 for everything, and that includes title and permanent registration that never needs renewal. So I'm done with DMV for as long as I own this trailer.
Yep, and if you're 65 or older you are entitled to obtain one motor vehicle registration for free which is a permanent registration "P" tab.
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Old 03-03-2021, 03:17 PM   #9
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It is pretty obvious what the intent is when living in another state and registering in Montana. Long before this thread, I read an article that Minnesota was cracking down on Montana registrations. When law enforcement gets involved, it is a lot more than a traffic ticket. Georgia, California, Texas, Minnesota and other states getting more involved in enforcement.

There are tales that red cars attract police. What may be more true is that Montana plates may get their attention quicker. Who wants that type of attention?
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Old 03-03-2021, 03:19 PM   #10
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Wow, glad I live in SC. You pay $500.00 flat sales tax on RV, Boat, Auto, whichever. This is for new purchases. There is a lesser threshold where you would actually pay less for used model.
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Old 03-03-2021, 03:38 PM   #11
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Just an FYI California has a CHEATERS Program to try and catch out of state registered vehicles being driven on a regular basis.
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Old 03-03-2021, 04:28 PM   #12
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Just an FYI California has a CHEATERS Program to try and catch out of state registered vehicles being driven on a regular basis.
I seem to recall an individual in the last century that had a police force that relied on folks to report their neighbors.
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Old 03-03-2021, 04:35 PM   #13
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If you don't want to get hit with tax fraud your drivers license, vehicle license and rv license has to be all from the same state
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Old 03-03-2021, 09:48 PM   #14
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Wow, glad I live in SC. You pay $500.00 flat sales tax on RV, Boat, Auto, whichever. This is for new purchases. There is a lesser threshold where you would actually pay less for used model.
My city has a sales tax. If I were to buy a new truck or trailer there I would have to pay $12.50 in sales tax.
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