What is the Sales Tax on an RV?

What is the Sales Tax on an RV?

You’re ready to purchase a recreational vehicle (RV) and you’ve shopped around, finally finding  the perfect one. You may be in store for sticker shock once you realize that the added sales tax could bust your budget.

RVs typically cost tens of thousands of dollars, while luxury models can range in the hundreds of thousands of dollars. Most states levy sales and property taxes on RVs, and in many states, you’ll also be responsible for local taxes. Combined, these taxes can cost you approximately 5 percent to over 10 percent above your planned RV purchase price!

recreational vehicle

In Montana, however, there are no sales or property taxes on RVs, and even out-of-state residents can take advantage of a legal way to register an RV in Montana and pay zero sales and property taxes. (As with any out-of-state purchase, always make sure to check the use tax rules in your home state.)

Sales Tax Examples at a Glance

Let’s take a look at how several sample tax rates on an RV can add up at different price points.

 

RV COST Combined State, Local, and Use Taxes Total Taxes Paid Total Price Paid for RV
$15,000 5% $750 $15,750
$30,000 5% $1,500 $31,500
$50,000 5% $2,500 $52,500
$100,000 5% $5,000 $105,000
$250,000 5% $12,500 $262,500
$500,000 5% $25,000 $525,000

 

Even at the lower end of the possible combined tax rates you might pay, you can still see how the costs begin to add up! Take a look at a few more sample combined tax rates, from midrange rates to the higher end.

 

RV COST Combined State, Local, and Use Taxes Total Taxes Paid Total Price Paid for RV
$15,000 8% $1,200 $16,200
$30,000 8% $2,400 $32,400
$50,000 8% $4,000 $54,000
$100,000 8% $8,000 $108,000
$250,000 8% $20,000 $270,000
$500,000 8% $40,000 $540,000

 

If state sales, local, and use taxes add up to 10 percent or more, you’re looking at thousands of dollars in taxes owed on even more moderately priced RVs.

 

RV COST Combined State, Local, and Use Taxes Total Taxes Paid Total Price Paid for RV
$15,000 10% $1,500 $16,500
$30,000 10% $3,000 $33,000
$50,000 10% $5,000 $55,000
$100,000 10% $10,000 $110,000
$250,000 10% $25,000 $275,000
$500,000 10% $50,000 $550,000

 

 

RV COST Combined State, Local, and Use Taxes Total Taxes Paid Total Price Paid for RV
$15,000 12% $1,800 $16,800
$30,000 12% $3,600 $33,600
$50,000 12% $6,000 $56,000
$100,000 12% $12,000 $112,000
$250,000 12% $30,000 $280,000
$500,000 12% $60,000 $560,000

 

How to Pay $0 in Sales Tax for an RVsales tax on rv

In order to save on sales tax for an RV purchase, and you don’t live in the state of Montana, you first need to create a Montana-registered Limited Liability Corporation (LLC). You can purchase, register, title, and insure an RV through an LLC. When your LLC is registered in Montana, it enjoys the same tax benefits that all Montana residents receive. That means you do not owe sales tax on your RV purchase.

To set up an LLC in Montana, you must have a registered agent with a legal street address in Montana. MT Vehicles has decades of experience, not only acting as a registered agent for individuals who set up Montana LLCs, but also with helping them through the entire administrative LLC process. They also have pleny of know-how to assist with RV registration and titling for those who need it.

Contact us now at 1-877-913-5100 or click here to get started.

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