You’re at a car show. Los Angeles, Columbus, Louisville, any city across the country. You drove 20 minutes, maybe an hour to get to the spot. As you’re inspecting the racers and cruisers, you notice that one of them has a Montana license plate …
At first, you think to yourself, “Wow, they must have driven for days to get here!” Then you notice another Montana plate. And another. And another. The questions start coming. Are all exotic car owners Montanans? Did they all drive all the way here? Or is it just one Montanan who brought about a dozen of his or her cars to the show?
All seem unlikely.
As you probably guessed, not all exotic car owners live in Montana. But many exotic car owners are smart about their money and that is what leads us to the Montana plates.
Paying Sales Tax Upon Registration
When you get a new (or new to you) car, whether it’s a Lamborghini or a Honda, you’ll need to take it to the DMV to get registered. This is where you’ll get plates, tags, the title, the whole shebang. However, you’ll also need to pay sales tax on the vehicle.
Oddly enough, sales tax isn’t paid when you buy the car from an individual or a dealership, but when you go to the DMV to get it registered. Interestingly, not all states have sales tax, so depending on where you are, there may be nothing but registration and license plate fees to pay at the DMV.
Enter Montana.
“The Treasure State” does not have a general-use sales tax. So if you’re registering there, there will be no sales tax to pay at the dealership, when you get your plates, or ever.
Why You Want a Montana Car Registration
It’s a simple answer — no sales tax. Depending on what kind of car you have purchased and what state you would have registered in, this could mean thousands of dollars in savings. For example, say you lived in Seattle, Washington.
Sales tax there, including Washington, Seattle, and King’s individual taxes, is 10.25%. If you bought a $350,000 2019 Ferrari 488 Spider, you would end up paying $35,875 in sales tax!
But what if you lived in Los Angeles, California? Sales tax there is about 9.5%. Less than Seattle, but you would still pay over $33,000 on sales tax. A Montana car registration would save you all those thousands of dollars.
Montana RV Registration
RVs also require sales tax to be paid in most states.
RVs, as you know, are much more expensive than most cars. It’s not uncommon for a motorhome to fetch upwards of $200,000. Registering your RV in Montana can save you thousands, just like registering your car in Montana.
Montana Registration Laws
In order to register your car or RV in Montana, you must follow the state laws in place. According to Montana state law, only residents or temporary, working residents can register their vehicles in the state. Don’t worry though, you don’t need to up and move to make a Montana car registration or Montana RV registration work.
You can set up an LLC in Montana and buy the car through the LLC. This will make it a company car. There are companies which can help you set up an LLC in Montana and register your car there with little to no hassle.
Step By Step, How to Register Your Car In Montana
If saving thousands of dollars in taxes sounds attractive to you, you’ll need to be ready to register your car or RV in Montana. You can find a list of things you’ll need on the Montana DMV’s website.
First, you’ll need to complete a vehicle registration application. This form can be found on the Montana DMV’s website under “Most Requested Forms.” Download the form, fill it out, and bring it with you to the County Treasurer’s office.
Next, you must show proof of insurance. In order to obtain the best value of insurance, get quotes from several providers and compare them, finding the best coverage for the lowest price.
You’ll need the VIN, the make, model, color, body type, and year of the vehicle you’re insuring. Once you have your insurance, the insurance company will either send you an insurance card in the mail or tell you to download their app.
Keep the insurance card in your car if you don’t have the app. If you download and sign into the app, you can pull up your insurance information with a few taps of the finger anytime you might need it.
Next, you’ll need to present the vehicle’s title. If you paid in full for your vehicle, the dealership or individual seller should give you the title right away. If you took out a loan on your vehicle, a lien will be put on the car and your lender will become the lienholder. They will have possession of the title while you work on paying off the loan. Make sure you pick the right lender by being proactive.
Go to your bank and get pre-approval for a loan. When you’re at the dealership, ask them to run quotes, too. This way, you’ll have several options and you can choose the best deal, the one that will cost you the least when it’s all over, and the title is yours. If you still have a loan out and don’t have the title yet, don’t worry. You can bring proof of payment to the County Treasurer’s Office in place of the title.
Next, you’ll pay the registration fee. Montana is interesting in that it provides you options: you can register for one year, two years, or permanently. The registration fee is based on the age of the car and how long you would like to register it for. For a 12-month registration, it will cost you between $28 and $217.
Lastly, you’ll be asked to pay a county option tax and license plate fees. Be prepared to pay.
Montana LLCs
Though we mention this in “Montana Registration Laws,” it is worth circling back and revisiting the concept of Montana LLCs. The formation of a Montana LLC is central to registering your car in the state. It is not permitted for a non-resident to register his or her car in Montana.
In order to avoid literally moving to Montana in order to register your car there, you can register an LLC in the state. This way, the Montana LLC can make the purchase, skip the sales tax, and get the car registered. Create your LLC in a county that doesn’t add a local sales tax in order to save the most money.
One can’t create an LLC from his or her laptop. You will need a lawyer to help set it up with you. Luckily, there are third party companies which can connect you to a lawyer, get your LLC set up, and get your car registered, all for one small fee. This fee is an investment that will save you thousands of dollars in the end.
Why a Montana LLC Is (Likely) Right for You
You have worked, earned, and saved for your dream vehicle. Be it a fast and sexy sportscar or a motorhome in which you can take your family to the most beautiful destinations you can imagine, it’s something for which you’ve saved the hard-earned cash.
And let’s just say it: a lot of cash. The last thing you need after all the blood, sweat, and tears is to be taxed into oblivion. You want the money you earned to go towards the vehicle, not its sales tax.
Obtaining a Montana LLC is how you’ll avoid spending thousands more than you need to on your dream vehicle. Get the LLC, get to the County Treasurer’s Office, and walk out with your plates and stickers without writing a five-figure check. If you are smart with your money, if you save your money where you can and spend where you want, this is the move for you.
Need your Montana License Plate or Montana LLC contact us today
