- High-value cars with fraudulent Montana Registrations allow buyers to avoid sales taxes.
- California indicted 14 people for using this loophole to avoid paying taxes on their expensive supercars.
- The cars involved include the McLaren Elva, Porsche Carrera GT and Ferrari TdF.
For years now, if you bought an expensive car but wanted to avoid potentially paying high taxes on it, you could register it in Montana. All you need to do is create an LLC in that state, then register your car with that business.
This allows owners of very expensive supercars to not pay taxes in their home states. Or at least it did, until some states started cracking down on the practice. California has been promising to do this for years, but is now finally taking action.
California Attorney General Rob Bonta’s office released a statement said that 14 people had been charged with tax fraud. Their car was registered in Montana and wore Montana license plates, but was garaged and driven in California.
According to the Attorney General’s Office, the cars involved in this crackdown include the McLaren Elva, Porsche Carrera GT and Ferrari TdF. The vehicles are worth more than a million dollars each, and that’s just a portion of the more than $20 million in vehicles owned by the 14 people involved in the crackdown.
The money California collects from these taxes goes to roads, schools, and community services in the state. The tax may be considered high by some, as California has the highest state-specific rates in the country. However, other areas of the country may have higher municipal or combined tax rates.
Regardless, if you live in certain states and want to drive a car on those roads, you have to pay taxes. And if you buy a million-dollar car, you have money to pay taxes on.
Motor Pickup1: Seeing a high-value car with Montana plates, even though it doesn’t actually in Montana, always lame. Paying taxes is never fun, but if you can afford a supercar, pay your supercar taxes.
Or move to Montana.
