Why Thousands Choose to Register Their Cars In Montana
Practically every person has come across a sleek, luxury car on the highway, decked with all the bells and whistles that would make any ordinary car owner do a double-take. But upon taking a closer look, an out-of-state license plate appears to be tacked onto the bumper. Why would such a super-car have out-of-state plates?
That must mean it was bought under shady circumstances, one might wonder.
However, thousands of car owners — both ordinary and ostentatious — sport out-of-state license plates using a perfectly legal method that not only allows them to operate their vehicle anywhere in the country, but also be rid of financial burdens like hefty sales tax and license and registration fees. And not just among the wealthy; such a method allows the ordinary to purchase even the most ostentatious vehicles.
Now, we’re sure you have a handful of questions, so let’s uncover more information about this phenomenon, including how you can become a part of it.
Why Out-of-State Car Registration Is the Next Big Thing
Owning a car is one thing, but operating it is another. The initial purchase of any vehicle is something the vast majority have to budget for, but the additional costs involved with maintaining aren’t as predictable.
In many cases, those additional costs can amount to more than the actual price of the car. Particularly in today’s car market, where the average price of both new and used cars has skyrocketed, many people simply can’t afford to maintain their vehicles.
This has unfortunately left many dealers and individuals unable to purchase vehicles—whether it’s a motorhome, motorcycle, car, or RV — so much so, that dealers have begun contacting past customers offering to buy back their cars.
As the demand only looks to continue outweighing the supply, it’s become near impossible to get “a good deal” on any vehicle. However, both dealers and individuals have seemingly found a silver lining to the car crisis: out-of-state registration.
Let’s revisit our opening hypothetical: why do so many luxury cars have out-of-state license plates? Is it just a fun, new trend? Certainly not. With most luxury cars, the cost of owning the vehicle can amount to millions — that’s what makes it luxury. But what some luxury car owners don’t tell you is the outstanding taxes and fees that come with the purchase of the car.
In states like California, Washington, and New York, where sales tax, title and registration, and inspection fees are extremely high, buying a luxury car means paying the initial million-dollar price tag, but also an additional couple hundred thousand in fees.
So, to get around such hefty costs, luxury car owners are registering their vehicles in other states, while they continue to operate them in their current state of residency.
Montana Car Registration: What Not to Do
Of course, this brings up the question of legality. Surely, there is no way that buying a car in one state and driving it in another is legal … or is it? Regarding how to register your car in Montana, there is a perfectly legal way to do so, but before jumping right to that, let’s go over what not to do.
According to federal and state law, falsifying or misleading your personal information at DMV, such as your residential address, is illegal. Not only is it forbidden by law, but it’s a punishable offense that can result in fines of up to thousands of dollars.
In more extreme, deliberate cases, the government is entitled to press felony charges, which can result in up to four years in prison and additional fines. The above situation is a worst-case scenario and it’s extremely unlikely you will fall victim to such a circumstance. However, you should still take every detail involved with registering an out-of-state vehicle with the utmost scrutiny and attention to detail.
Before we dive into the process of Montana car registration any further, we advise you to contact and consult with a professional attorney before taking any further steps. Even if you’re only interested in the idea of doing so, it helps to have the protection and advice of a legal expert.
What to Know About Montana Car Registration
Ah, sales tax: the vexatious fee tacked on to nearly every single completed purchase. No matter how universal it is, people never seem to get used to it. Particularly when it comes to the purchase of any vehicle, sales tax fees can result in an overall higher cost than you might expect. And if you happen to live in a densely populated state, it’s likely that your sales tax rate is just as inflated.
Enter, the biggest reason so many people register their car in Montana: there is no sales tax.
Yes, you read that right. Zip. Zilch. Zero. Nada. Montana is completely sales-tax-free.
Don’t worry — there’s no catch for out-of-state residents. Instead of drawing their funding from sales tax, the Montana government generates financing from income tax — which, as someone who doesn’t live in the state, doesn’t affect you in the slightest.
With the exemption of sales tax, the possibility of purchasing a luxury car suddenly becomes far more attainable, and not just for the wealthy. Plus, Montana is also widely known for its low licensing and registration fees, and no annual inspection or emissions testing requirements.
For example, the luxurious 2022 Tesla Model X currently costs just over $46,000 — definitely no small purchase, but achievable, nonetheless. As a hypothetical resident of Miami, Florida, purchasing such a car would demand an additional sales tax of $3,220. Now, tack on the $225 initial registration fee and an inspection cost of $100-$200, and your total vehicle purchase comes out to more than $50,000.
Purchasing a car is already a big decision, but all the extra costs and taxes that come with it make it even more difficult to achieve. By removing sales tax and pesky fees, owning and operating a luxury car becomes more affordable, and thus, more accessible to the majority.
The Next Step: How to Register Your Car In Montana
Now that you know why people are registering their cars in Montana, let’s briefly uncover how they’re doing it. A limited liability company (LLC), also called a “shell company,” is the key to successfully obtaining a Montana car registration, particularly for those who don’t live in-state.
A shell company is essentially a business structure with no active business operations or considerable belongings that function primarily to protect the owner’s and members’ assets — such as an individual’s newly purchased vehicle. Shell companies can be opened anywhere in the country, and there is no need to transfer your residency to do so.
By opening a shell company somewhere such as Montana, an individual can purchase and register that vehicle under their Montana LLC and enjoy the various financial and tax benefits that come with any Montana-based purchase. Even though you’d be driving that vehicle in a different state, it would belong to the LLC you registered in Montana — making it a completely legal purchase.
Other than some additional paperwork and payment requirements, there’s not much else to the process of registering your car out-of-state. Montana even offers the perk of one-time flat-fee registration options, according to the age of your newly purchased car.
It’s worth mentioning, however, that not all insurance companies will be as excited as you are about out-of-state car registration; the company might assume the car was purchased under illegal circumstances and refuse any claims.
Fortunately, that’s where consulting with a third-party professional comes in. Not only can they serve as the first line of defense when such a case should cases arise, but they can offer guidance and support throughout the entire purchase and resignation process.
From the forming of your Montana LLC to the registration of your vehicle, all the way to sending your plates and registration directly to you, hiring a third-party service can streamline the process and ensure you’re getting the best deal possible.
Don’t Be Left Out: Get Your Montana License Plate Today
The modern car market is becoming increasingly unpredictable; with dealers and owners alike unsure how, when, and where to purchase vehicles, the solution of registering your car out-of-state in Montana becomes all the more appealing.
That way, you can partake in the included financial benefits regardless of where you live. Especially when you partner up with an external registration agency, you can save thousands in your total ongoing car cost.
Opening your shell company and purchasing your new car for your LLC becomes easier, and in just a matter of weeks, you can receive your Montana license plate and operate your luxury car in whatever state you reside in.
In addition to the help of third-party professionals, consulting with a legal expert can also ensure you understand all the key details involved with buying and registering your car in Montana, while also ensuring you go through each step efficiently and legally.
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