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California Finally Closes the Montana Loophole for Exotic Cars
Mark Vaughan wrote in autoweek.com today that California is cracking down on Montana tax cheats. If you live in California, take note that registering your car in Montana, or elsewhere, is now illegal.
For years, a tax strategy that allowed luxury-car owners to save tens of thousands of dollars by registering their vehicles through shell companies in the sales-tax-free state of Montana has finally been outlawed by the state of California.
The so-called Montana loophole was a tax evasion practice where California residents created shell companies (usually a Limited Liability Company, or LLC) in Montana to purchase and register luxury cars, supercars, or RVs. Montana has no statewide general sales tax or heavy vehicle license fees, unlike California.
(Many thanks to Ben T. for sharing)
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As each registration is an LLC, I wonder if this will have a major impact on our status as one of the most entrepreneurial states?