Drivers License Wake Up Call

[Jon Wehrenberg]

Sticks, I am not a lawyer and I don't play one on TV, but if I were one I would ask you a few questions because you are clearly entering an area where you need to do some risk versus reward calculations.

To anyone with an IQ above room temperature a Montanna LLC is a tax EVASION technique. Unless you specifically have a business purpose for the Montanna LLC, and that business requires the use of a coach your only purpose is to not pay sales taxes that your home state would impose.

Some states have already started going after the taxes they feel entitled to collect from folks that have put their coaches in a Montanna LLC. So here are some questions. How long do you keep your coaches? Obviously if you flip them routinely, an LLC will save you a lot of money in sales taxes. How risk averse are you? Your home state may never go after tax evaders. Are you willing to risk that? All it takes is a grumpy neighbor to turn you in and make your life miserable.

Are you willing to do all that is necessary to insulate yourself from grief? To really appear to be based in Montanna and have a purpose can you find a way to use a coach for business purposes? Are you willing to register the toad there? What about getting a driver license there? There are still no laws against anyone having two domiciles.

I spoke to a guy many years ago that tried to beat California out of its sales tax by registering a new Prevost in Nevada. The trouble is he continued to tow a California registered toad and still had a California driver license. He was caught, and his costs were the sales tax, interest, and a $75,000 fine. As the states get caught up in our debt crisis they are going to go after every penny they can. Big fancy buses are very visible targets and the average voter and citizen is likely to love seeing the rich folks get spanked.

[ajhaig]

Every state is different, I'd check with the MT firms that handle these types of LLC's and then get a second opinion from an attorney that practices in your home state.

We sold our property in our former "home" state and full-timed for a year. The MT LLC option worked for us and it was perfectly legitimate. Also, in our former "home" state it was ok to register a vehicle in a different state provided that the vehicle was kept out of state (there was a provision in the law that would allow us to bring the vehicle into that state for something like 60 days per year).

To Jon's point, I'd be very leery of anything that seems like a gray area; states are hungry for any revenues they can get their hands on.

[Ray Davis]

IN CA now they routinely have people going into RV parks, and looking for Montana plates on a RV, and CA plates on a toad.

The CHP will stop and ask you around 5 questions:

1. Which state is your RV registered in?
2. Which state is your cars registered in?
3. Which state do you live in?
4. Which state do you file income tax in?
5. Which state do you work in?

If your answer to #1 is Montana, and everything else is CA, then be prepared for problems.

I hear the same is try in CO, and many other states are following their lead.

Ray

[michaeldterry]

Just bought a 2005 Liberty last month and the previous owner was listed from Montana (LLC?). How do we go about registering our coach in a Montana LLC?I haven't gone down to the local DOT to pay the staggering sales tax, etc. because I just received the title 2 days ago.

BTW sticks - I noticed that you did get a picture posted for your sig - beautiful bus!

Also - a comment on driver licenses - Even though I've been driving intercity buses (Eagles, MCI's, Prevosts, etc.) since 1980, I got my Class B CDL with passenger endorsement back in about 1990 when the DOT first required them as I was driving intercity buses for touring DCI drum and bugle corps each summer. I know that it's widely accepted in many states that you don't need a CDL to drive a private coach/motorhome, but I've always kept my CDL current "just in case" (and I still volunteer occasionally to drive a week or two for drum corps tours).

As for the Montana LLC issue - I'm simply not smart enough to remember which lies I've told to who, so I have to "play it straight" to stay out of trouble!

[sticks]

I made up my mind about 20 minutes after my post last night that I didn't have the stomach for pursuing a Montana LLC. I planned all along to belly up to the bar and pay the sales tax , so I guess , I can sleep better at night even though my wallet will be considerably lighter. Thanks for your posts, I'm in good company

[Ray Davis]

Back on the drivers license part of the thread ....

As I understand it (I could be wrong), all states will accept the license that is required in the state that has issued the tags. IN many states you may drive an RV (as long as it's titled as an RV, not a bus) with a standard drivers license.

In CA this is true, but only up to 40 feet. Above 40 requires a Class B non-commercial license. It might as well have been a CDL, however, as my drivers test alone was 90 minutes, taken at a CDL facility, and I have to do a physical every two years, just like a CDL?

I know several people in CA who don't have a class B license and are driving rigs over 40 foot. The primary reason I went through the hassle was in case of an accident. Can you imagine if you were involved in a TA (not even your fault), and they find out that the driver of the "million dollar bus" is not licensed to drive it? I don't even want to think of what would happen in that case!

Ray

[Jon Wehrenberg]

Yes, it hurts to pay the sales tax. But since my bus, toads and driver license are all TN I don't have to worry about the efforts the states are going to mount to collect every penny they can squeeze out of the few of us that actually still pay taxes rather than collect benefits.

I have a CDL for the very reason Ray states. I don't want the hassle of defending my skills relating driving the bus questioned. Some have stated that if we possess a CDL and are stopped for an infraction that the legal system is harder on us because we are professional drivers, but I fear a lawyer who would sue me in the event of a TA being indignant because I am driving a 65 foot long vehicle with a combined weight of 53,000 pounds and do not possess proof that I passed a driver's test for such a vehicle.

[Will Garner]

Jon,

If that day comes that you go face to face with a wanna-be Perry Mason, I'm betting on your side carrying the day. The rules are simple. In your case there is no question that can be answered with a simple yes or no, not even a maybe. I am confident that you could present a seminar in response to any lawyer's question that would quite simply bowl over the jury in your favor!

I once had a lawyer badger me trying to make me out a fool in front of the judge and jury. I was not even sworn in as an expert witness. He kept asking for the conversion factor to go from miles per hour to feet per second (1.4746....). I told him that I did not commit conversion factors to memory as being an engineer I could make the calculation necessary to derive the factor. After asking 2-3 times and getting the same answer he pulled out an Engineer's field book and vigoriously pointed to a list of conversion factors and said something like, "Here it is, now do you agree the number is 1.47?! My response was to ask him had he ever run across a publishing error and further, my three previous offers to calculate the factor and carry it out to as many decimals as he so choose still stood. No more conversion factor questions.

Later that same lawyer asked me to describe how the traffic signal works. I tried to do it with as much simplicity as possible. At the end of my description he threw up his hands and said he was totally confused and did not understand a thing I said. I replied before anything else could be said, that if he did not understand how traffic signals worked that he should turn his license in to the judge and get a ride home. I glanced at the judge and he had a very large grin on his face.

The next day, after having taken time to study the intersection in question, and to reflect on that lawyer's opening statement to the jury, I called the lawyer that had called me into court, and told him that I now had a theory on what actually occurred that led to the crash. This lawyer then called the other lawyer, told him what I was now willing to testify to as an expert witness and that it was based on interest raised from his opening statement. The other side offerred a $25,000 settlement on the spot and the lawyer that had called me to court took it.

So in this specific case never give a yes, no, or even a maybe answer to a lawyer's question. This goes against my usual recommendation, which is to always just say yes or no, or I don't understand your question, could you possibly rephrase it for me so that I may understand what you are asking. Never go into detail.

With your knowledge of buses, their systems, their repair and operation you could keep the courthouse tied up for days. Why heck, maybe you could even drive your coach to the courthouse in case they wanted to go over the systems. You could even use Hector's miniature Air System Demo and then take the lawyers out to see the real thing. Just make sure all the lawyers are under the bus when you dump the air!

Later ...

[Ray Davis]

Will,

Great story, but the issue I was worried about is specifically this:

Lawyer: Mr. Davis, were you involved in a TA on ......?
Me: Yes sir.

Lawyer: So, is your vehicle licensed in CA, and over 40 foot in length?
Me: Yes sir?

Layer: Do you posses a class B or A license?
Me: No, do I need one?


At that point it's obvious that you are driving a big, expensive vehicle that you are not licensed to drive. Open pockets, dig deep.

Ray

[hobobimmer]

I made up my mind about 20 minutes after my post last night that I didn't have the stomach for pursuing a Montana LLC. I planned all along to belly up to the bar and pay the sales tax , so I guess , I can sleep better at night even though my wallet will be considerably lighter. Thanks for your posts, I'm in good company

Sticks:

I think you made very good decision. From about 20 years ago, when I worked for a department store company, we bought an airplane that became based in Tennessee. We closed the purchase of the plane in Texas, basing our decision to do that on a Texas statute which said no sales tax was due on purchase of planes in Texas which were immediately put into use in interstate commerce. Not too long after, State of Tennessee comes to us for "Use Tax," plus interest, plus penalties. I ended up getting us out of the penalties, but not the interest or tax. That was educational exercise for me.

We're all talking about "Sales Tax." It might be that you can avoid Sales Tax by putting bus in Montana LLC, but check your state's "Use Tax" law. I would not be a bit surprised that Use Tax is what you owe. I don't know that I'm right about this, but I believe I am. Below is something I pulled off the internet when I searched "Tennessee Sales and Use Tax."

Eric Faires
Huntsville, TN

State sales and use tax - Sales tax is imposed on all retail sales, leases and rentals of most goods, as well as taxable services.

Use Tax - The use tax is the counterpart to the sales tax. It is applied when merchandise (tangible personal property) is purchased from outside the state of Tennessee and imported into the state for use or consumption. The 45 states that impose a sales tax also levy a use tax.