Just read an article in Hagerty about the pros and cons of registering out of state cars in Montana to take advantage of low (or no) taxes, streamlined registration, non-existent inspection and emissions testing, among other perks.

Obviously, I'm not going to do this because I live in Canada, but my inquiring mind wants to know if any of my fellow CO members are using this loophole, or have any familiarity with it.

 

Andy - Unless there's some workaround/loophole, etc. it appears you need to demonstrate County residency.

RESIDENCY - MONTANA LICENSE REQUIREMENT? Do I need a Montana ID to register my vehicle in Montana?

 

Norm, according to Hagerty, the workaround here is to establish an LLC domiciled in Montana and have it purchase the car and either lease it back to the de facto owner or just have it become a "company" car. It's pretty slick and apparently a whole cottage industry has sprung up just to guide out-of-staters who want to take advantage of the MT's more relaxed regulatory environment through the process. A lot of classic car owners are doing it and evidently if you go to shows or Cars 'n' Coffee events in surrounding (or even distant) states you'll see a disproportionately high percentage of Montana tags.

 

Interesting. Like incorporating a business in Delaware.

 

I have that here in Oklahoma. Low registration, no inspections or smog requirements.

 

Exactly!
Cool. How's the taxation situation?

 

Most of the red states are that way. I get moderate registration, no inspection, no smog, rear tag only, and I can run plates from my grandfather's plate collection for each year on my old ones.

 

They have an excise and a sales tax on new/used cars. 1.25% for the sales tax and 3.25% for the excise tax. I did not pay any sales tax because it was an out of state transfer. Annual registration is 27.50 and I get a free drivers license because I'm over 65.

On a side note with doing the Montanna thing, how much does it cost to form the LLC. What are the legal ramifications, insurance, etc.... Sounds like a lot of trouble to save a couple of bux.

 

I agree, to the extent that it probably wouldn't be worth doing for just one or two cars, but if you keep a whole stable then the savings could amount to many thousands. And my understanding (again, via Hagerty's) is that MT has no sales/excise/transfer taxes or fees to speak of. Many of the agencies who provide the service are, or have on staff, lawyers who will walk customers through the process and provide legal opinions.

Would love it if a CO member from Montana (or even better, somebody from out of state who has personal experience) would chime in to corroborate or correct and weigh in with an opinion of practicability.

 

In the legal world, we would call this a sham LLC and vehicle registration. Most states are going to have a statute requiring any new domiciliary to register their vehicles and obtain a new driver's license by the expiration of a short period after moving. I will spare you the verbatim statutory language and give you just an illustration from one state:

Official NCDMV: Moving to North Carolina

It reminds me of the days when sham titles were advertised for sale in Hemmings, especially from states like Alabama. Based on a lot of personal experience, state DMV officials do read and become aware such schemes. It is just a question of time before they start acting on this one.

 

Montana has no taxes when registering a vehicle or emissions. Any vehicle over 11 years old can get permanent plates for added cost but don't have to do yearly renewal of tabs. Almost all my vehicles but 1 are registered that way. I once saw a local MT plate on a Shelby Cobra on a TV show, never saw that car around here so looked it up and many collectors do get MT LLCs for vehicle purposes. I know South Dakota is also a place where many people that live in RVs year round get PO Boxes and have them registered. No state income tax and cheap vehicle registrations. A whole industry is built around it.

 

Kentucky is extremely forgiving of old cars. I pay sixty three cents a year on my 1970 Olds with historic plates.

 

I can assure you that legislators are working hard to close the loophole for more tax money. I'd like to personally thank Hagerty and all of you for publicizing it.

 

My 442 is owned by my Montana LLC. The LLC setup requires an attorney and is not cheap, I used this to register my motorhome, and then added my vehicles. I have since sold the Rv, and registered my dd in Florida, I still need to register my 442 here. I don’t think an LLC is a good idea unless the owner is domiciled in another state and travels out of that state on a regular basis.
my .02

 

It also depends on how much the vehicle cost you. A lot of Ferrari, Porsche, Lambo, etc are done this way. Save a huge amount on taxes. So based on the cost of these vehicles it is worth it.

 

I think mostly dealers do this..

 

Dealers receive a higher level of scrutiny from an Enforcement and Theft Division of a DMV.

 

Weird, looks like my previous post was deleted.

I'll say it again: MT plates are for skirting emissions and safety standards.

 

I never saw it. When did you post?

 

Nope, not deleted. YOU posted in an an unrelated thread.

 

I see. Here's the real deal.

It's mostly to skirt emissions or safety standards. Bailey had MT plates on the Mexican Ramcharger. It's got the Hurricane I-6 and hasn't passed NHTSA crash standards. There's a 7 sec GTR around here. I'd imagine that much power is not easy to make emissions compliant, so it has MT plates, too.
I think most states have classic car exemptions, don't they?

I can't stand this site software. Sorry for the mistake.

 

No inspections, no emissions tests here in SC. My 79 blue Calais is up fairly soon for a new exhaust system and I just happen to have a test pipe that will fit it. But really, what boost would that give to a 105 hp 260 wheezer. Not happening. I'm even going back to single exhaust with a more modern Wagner Cat to replace the A/C pancake and calling it a day.

They do have SCDOT vehicles that randomly pull people over for vehicle "condition checks", but I myself have never seen them grab an old car for review. But, I'm just one person in a big State.

 

When did that start for personal vehicles? In SC, law enforcement can't just pull Joe Citizen over if they don't have probable cause a crime has been committed, you violated a statute, or if your car is obviously an immediate safety hazard. Same with running a license or plate check. Which, I would admit, probably wouldn't be hard with most of the idiots driving around in this state. Commercial vehicles are an exception, such as bigger trucks, delivery vans, etc., or if they have cause to believe a vehicle is being used as an unregistered commercial vehicle (FedEx renting Penske trucks to make deliveries, for example).