RV Sales Tax By State (How Do You Avoid Sales Tax On an RV?)
The dreaded sales tax. Some countries in the world hide the sales tax in the purchase price. That way you see one price and pay that price. However, in America & Canada, the sales tax is added afterward. This can bring some serious sticker shock to some RV buyers
The best way to avoid paying a sales Tax is to make your purchase in Montana or Oregon or any other state that does not charge a sales tax. But buying out of state is no guarantee that you will avoid paying a sales tax. Some states add a sales tax when you make an out-of-state purchase.
To learn more about this issue, just continue to read our article. It is filled with the information you want to know about so you can decide where to buy an RV. Because all sales are well documented, tax officials collect every penny owed to their state.
Do You Pay Sales Tax on RVs?
Yes, you do, or at least in those estates that charge an RV sales tax. It is becoming more difficult to avoid paying this tax as states have stricter laws about buying out of state and then importing your RV.
If you do it too soon, you will be subject to a sales tax. When you buy out of state, and in one of those states that has no sales tax, be prepared to have a legal permanent address in the state of purchase.
That has become a requirement over the years. Also, states with no sales tax have become creative in their pursuit of revenue. Delaware is one example as they do not charge an RV sales tax, but they do charge a 4.25% document fee.
The name may be changed but the tax remains. When you go to register your RV, what fees you pay will depend on which state you register it in. This topic is a very complicated issue as all states have their own laws about RVs.
If you live on the border of a no sales tax state you may have some leeway but be careful, loopholes get closed very quietly sometimes.
States With no Sales Tax on RVs
There are only 5 states currently that charge no sales tax on RVs or other products. Those 5 states are Alaska, Delaware, Montana, New Hampshire, and Oregon. If you live on the border of these states, you may be able to save some money as well as on registration fees.
Unless you buy in Delaware. Also, you need to watch out for the registration deadline. Each state has its own deadline for when you are to register your RV in their state.
Each state is unique as well as along with no sales tax, Montana allows corporations to register vehicles in their state. This law has allowed a whole cottage industry to develop in the state.
Also, this law allows RV owners to avoid use taxes as well that are charged in their home state. Then you do not have to go this route alone. It turns out that there are a lot of law offices in Montana dedicated to helping you register your RV in Montana.
There is also what is called cross state sales which is living in one state and buying in another. Watch out for those laws as loopholes can be plugged very easily.
RV Sales Tax By State
Here is a list of states that have either no sales tax or a sales tax. There is also registration information included so you know what is expected of you when you make your purchase.
RV sales tax in Nevada--
8.1% and must register within 30 days of purchase
RV sales tax in Florida--
Pay local tax rate and must register within 10 days of purchase
RV sales tax California--
7.25% to 10.25% Must register within 10 days of purchase
RV sales tax Texas--
6.25% and must register within 30 days
RV sales tax in Arkansas--
6.5% + county + city Must register within 30 days of purchase
RV sales tax Washington state--
6.5% and must register within 15 days
RV sales tax Illinois--
6.25% and must be registered within 20 days of purchase
RV sales tax Arizona--
5.6% + county + city Must register within 15 days of purchase
RV sales tax Alabama--
2% + county rate+ city rate Must register within 20 days of purchase
Missouri RV sales tax--
4.225% + Local tax Must register within 30 days of purchase
Kansas RV sales tax--
7.3% to 8.775% Must be registered within 90 days of purchase
Tennessee sales tax for RV--
7% no time frame for registration requirements
Michigan sales tax for RV--
6% and must register within 15 days of purchase
Kentucky RV sales tax--
6%
RV sales tax Montana--
No RV State Sales Tax Must register within 60 days of purchase
RV sales tax in Mississippi--
5% and must register within 30 days of purchase
RV sales tax in Minnesota--
6.5% and must register within 60 days of purchase
RV sales tax North Carolina--
3% or to a maximum of $2,000. Must register within 30 days of purchase
RV sales tax Nebraska--
5.5% and must register within 30 days of purchase
RV sales tax New York--
4% and must register within 30 days of purchase or within 180 days of the effective insurance date
RV sales tax New Mexico--
4% and must register within 60 days of purchase
RV sales tax New Jersey--
6.225% and must register within 60 days of purchase
RV sales tax Oklahoma--
3.25% and must register within 30 days of purchase
RV sales tax Oregon--
No state RV sales tax, but 1.5% business tax for an LLC RV. Must be registered within 30 days of purchase
RV sales tax Ohio--
5.75% and must register within 30 days of purchase
Pennsylvania RV sales tax--
6% statewide 7% for residents of Allegheny County 8% for City of Philadelphia residents Must register within 20 days
RV sales tax South Carolina--
6% and must register within 30 days
RV sales tax South Dakota--
4.25% must register within 45 days
RV sales tax Utah--
6.85% + Documentation fee of $149 Must register within 60 days
RV sales tax Vermont--
6% and must register within 60 days
RV sales tax Virginia--
4.15% and must register within 30 day
RV sales Tax Washington, DC--
6% + Excise taxes of .3% or more. Must register within 60 days
RV sales tax Wisconsin--
5% and the dealership handles registration requirements
West Virginia RV sales tax--
6% + Titling fee. Must register within 30 days
Wyoming RV sales tax--
4% and you are required to self-register the vehicle as soon as possible
RV sales Tax Rhode Island--
7% and must register within 30 days
RV sales tax North Dakota--
5% and must register within 75 days of purchase
RV sales tax New Hampshire--
No RV State Sales Tax, but registration fees for State and municipalities and pass an emissions test. Must register within 20 days of purchase
RV sales tax Maryland--
6% and must register within 60 days of purchase
RV sales tax Maine--
5.5% and must register in person with the local municipality within 30 days of purchase
Louisiana RV sales tax--
4% and must register within 40 days of purchase
Hawaii RV sales tax--
4.12% + county taxes apply. Must register within 30 days of purchase
Georgia RV sales tax--
6.6% and must register within 60 days of purchase
RV sales tax Idaho--
Taxes calculated by RV value tiers Must be registered within 60 days of purchase
RV sales tax Indiana--
7% and must be registered within 45 days of purchase
RV sales tax Iowa--
5% and must be registered within 30 days of purchase
RV sales tax Delaware--
No state tax for RVs but there is a 4.25% “Motor Vehicle Document Fee”
RV sales tax Colorado--
2.9% + county + city + district Must register within 60 days of purchase
RV sales tax Connecticut--
6.35% for vehicles $50k or less7.75% for a vehicle over $50,000 Must meet emissions testing requirements
Alaska RV sales tax--
0% + Municipal or County Taxes
We apologize if we missed your state. The information was taken from the following website https://www.rvingknowhow.com/rv-sales-tax-by-state
How do You Avoid Sales Tax On An RV
There really is only one way. Due to the extensive documentation of RV sales and enhanced communication between states, state governments are able to track down RV owners who made their RV purchase in another state.
Once they do and if it is within a certain time period, they will assess the home state’s sales tax on your purchase. This means that if you are not careful and you make your purchase in a no sales tax state, you can be charged a sales tax by your home state.
Unless you make your purchase in Montana. In this state, it is legal to incorporate as an LLC as the law states that LLC businesses can register their vehicles in the state.
This, you can set up such a corporation and avoid paying any sales tax, anywhere. You get a legitimate permanent address in Montana plus you can register your RV there cutting out the sales tax.
Your LLC gets all the same benefits and rights a regular Montana citizen gets and you do not have to pay any taxes in your home state. To set up your LLC you first have to select a unique business name, no duplication is allowed.
Then you select an agency to help you file the paperwork and they will act as your legal representative and take care of the red tape. The fees vary between agencies so pick a good one at an affordable price.
Since you would be saving anywhere between $4000 and $30,000 in sales tax, you can afford a very good agency to help you. What you are required to submit are the following items:
The name of your LLC (remember that this needs to be unique)
Duration of your LLC / how long you want it to exist
Mailing address
Registered agent information
Member information
Defining the management structure of your LLC
Signature and title of the person completing the paperwork
The registration of your new company takes about 7 to 10 business days and once it is done you can buy your RV or register a trailer you already own. The same agency will handle all the registration paperwork for you.
All you need to do is send them the paperwork so they can. The good news is this move is perfectly legal. Whether it will change remains to be seen.
Is RV Sales Tax Deductible?
You can check with a tax consultant before you make your purchase. They will give you all the necessary information to follow but yes, you can deduct your RV sales tax.
However, this is a one-time deduction and you cannot do it every year. The same goes for the ad valorem tax some states apply. This tax is based on the value of your RV and it can be used once as well.
Besides the sales tax, you may be able to use your RV for other tax deductions. Here are some of those options:
#1. RV loan interest- if your RV is your primary or secondary home, you should be able to deduct the interest of your loan from your taxes.
#2. RV business expenses- there is a list of expenses you may deduct if you use your RV for business purposes. However, if you use it for personal purposes you may not qualify.
#3. RV renting expenses- if you use your RV for part of the year and rent it out for the rest of the time, rental listing fees and insurance costs may be tax deductible
The best thing to do is talk to your tax accountant and see what you can or cannot do when it comes to deducting RV expenses from your taxes. We are not giving any tax advice here but pointing you in the right direction and giving you something to think about.
Tax advice should only come from tax professionals. Also, your tax consultant should tell which areas of these deductions need to be itemized and which do not have to be. Ask a lot of questions so you get all the answers you need.
Buying RV Out Of State Sales Tax
First off, it is okay and legal to buy an RV from a different state. You can even go and buy one across the country if you want. If that is where you find your dream RV, you can do it.
While there are some good positives that come from buying out of state, there is one major drawback you should be aware of. If you register your new RV in your home state, you will be subject to your home state’s sales tax assessment.
That situation includes the purchase of your RV in a no sales tax state. Up above, we explained how to do this in Montana and it seems to be the only state that offers that loophole.
However, if you have another legitimate permanent address in a lower sales tax state, you can register it there to save some money. Out of 50 states, only 5 have no sales tax.
Chances are you do not have a permanent address in any of them. That means that you will have to pay a sales tax regardless of where you buy it. When you make your purchase, just make sure to buy insurance to cover you as you drive your RV home.
What To Watch Out For When Buying Out Of State
Most states now have laws governing out of state RV purchases. You may save a lot of money by buying and registering your RV in Montana but when you bring that RV back to your home state, you have to re-register it.
The time frame to re-register varies from state to state but you get anywhere from 30 days to 6 weeks to do it. Just like changing your driver’s license when you move to a new state.
If you wait to register your new RV in your home state and you go past that deadline, it is now a crime. You are in a lot of trouble if you are discovered. Check out the laws carefully so you do not end up paying for an LLC for nothing in return.
Some Final Words
Governments have a way of collecting their fair share of our money. They create laws that you may never have heard about that govern RV purchases. Before you make an out of state purchase, talk to a lawyer who is familiar with those laws.
Violating them will cost you a lot more than just the sales tax price. It is not a situation you want to be in.
