Domicile SD - RV-Dreams Community Forum

gauijons · RV-Dreams Community Member

Domicile SD

Technomadia · RV-Dreams Family Member

I believe the rule is still that once you register your vehicles, you have 90-days to physically get to SD and complete your intentions of stating domicile by obtaining your driver's licenses.

Most of the mail forwarding companies up there (MyDakotaAddress, Alternative Resources, etc.) take just a few days to setup your account with them to be able to act as your proxy to handle your vehicle registration for you. Contact the ones you are interested in utilizing and ask them for the exact process.. they do this day in and out, and probably have it posted on their websites :)

- Cherie

gauijons · RV-Dreams Community Member

Thanks, I guess that the Q is if we are still working in Iowa and buy a motorhome 6-9 months before we quit our jobs and hit the road, don´t we still have to pay sales tax in IA ?? even if we go within 90 days to register in SD ?? I also wonder how long can one work in IA after registering in SD??

My DW Tricia enjoyed chatting with you earlier this week.

WestWardHo · RV-Dreams Family Member

If you're financing in Iowa, check with your lender as I believe most local banks and credit unions won't lend to full-timers but some do. I believe your dealer will require a drivers license for the state in which the rig will be registered so you won't avoid sales tax. Unless you have SD drivers license which you must get in person. Plus it could get complicated with your state income tax if any if you're still working in Iowa for a number of months.

IF you're financing your rig, you might calculate the interest %-age difference between full timing and and an instate non-full timing loan. Then balance that off with the greater instate sales tax. Hope this makes sense.

Again, you should talk to a tax advisor.

Sherry

NWescapee · RV-Dreams Family Member

we found that dealers are willing to license in any state, it's the lenders who require the license as the official ID to obtain a loan. If you're paying cash, it's not an issue. The banking laws are the problem. If we could have traveled to SD and got our licenses before initiating the loan, we could have registered the rig in SD.

Racerguy · RV-Dreams Family Member

You're jumping on a very slippery slope with what you are wanting to do.It can be considered tax evasion. You will have to pay the sales tax in IA in your current scenario.

bigboomer · RV-Dreams Family Member

As Racerguy pointed out, registering a vehicle in one state to make an attempt to reduce the tax burden can open Pandora's box. There are a lot of states that are very aggressive in tax collection and will pursue at all cost.

South Dakota's sale tax on RV's and other vehicles is 3%. The RV will need to be registered in SD. When you go to register the RV in SD they will ask for proof of tax paid and no matter where you bought the RV if you did not pay at least 3% they will make you pay up to and at least the 3%. If you paid over that they tell you "sorry to hear that you paid so much"!

The best and least red flag raising way to do it is to sell your home, establish your SD residency by setting up your address with one of the mail forwarding services, going to SD to get your drivers license, registering to vote, establishing bank accounts in SD and registering all of your vehicles in SD. If you still maintain a residence in another state and work in that state more than likely that state will want it's money and will do whatever it can to get it.

There are several cases out there with states like Minnesota, NY, California etc. who basically still consider you a resident if you have any kind of presence in the state (home, banking, work, vehicles, etc.). Some states consider you a resident even after just 3 months of working in that state. Breaking free of the chains has to be done by the book to prove you no longer consider them your legal "domicile".

Please consult your tax advisor and/ or attorney to make sure you do everything you need to do correctly to avoid pain later.

Good Luck,

Les

Lucky Mike · RV-Dreams Family Member

if you have noticed lately in the news.......Iowa is going after RVers for doing just that....going after LLC and corporate shells and registering in other states , and their prosecuting them !!

http://news.rvbasics.com/iowa-is-going-after-tax-evading-rv-owners/

Edit by moderator: Activated link. Terry

-- Edited by Terry and Jo on Wednesday 5th of June 2013 11:40:09 AM

WestWardHo · RV-Dreams Family Member

Les,

You said it best of all. Good job!!!!

Sherry

bigredoes · RV-Dreams Family Member

I concur with Les, as well, with one exception - I do not believe the sale of your present home is necessary prior to establishing SD residency. We didn't, but then again we didn't live in Iowa. Took us two years to sell the place and we did NOT stay there more than a couple of months a year until it sold

kb0zke · RV-Dreams Family Member

"I do not believe the sale of your present home is necessary prior to establishing SD residency." Given the slow real estate market these days, there are lots of people who are legal residents of one state and have a house for sale in another. From all that I've learned so far, there is no ONE checklist for establishing a domicile, but the more that you do to show that you have left the old state and are a resident of the new one the better. Canceling voter registration in the old state, getting new drivers licenses and license plates in the new state, registering to vote in the new state all go a long ways to proving that you have actually moved from the old to the new.

We're already in the process of cutting the Missouri ties (Missouri bank account will be gone in 90 days). We still haven't settled on the new domicile state yet, but we still have a bit of time on that. Since rules can and do change, we'll probably narrow it down to two front runners and then see which one gives us the best deal at the time we're ready to make the move. We are probably going to even transfer our church membership to a congregation in the new state, just in case Missouri decides to get picky.

DorisandDave · RV-Dreams Family Member

We registered our new fifth wheel in SD while still working in Kansas and bought the 5er in Nebraska. However, we didn't own a home at the time. When we established residency in SD we contacted our chosen mail service (Americas Mailbox) and we took care of everything through email and mail, including registration and re-registrating the tow vehicle and 2 motorcycles. The ONLY thing you can not do through the mail is driver's licenses. You must stay one night in the state, take your hotel or rv park receipt with you to the DMV. The mailbox service gave us a list of exactly what we needed in order to get our DL's.

For us residency was established by having an address in SD, registering 5er and truck in SD, and having DL's in SD. DL must be obtained within 90 days of registering vehicles.

Our situation:

5er and truck registered in SD

DL's in SD

Bank online through a bank in TX and one in KS

All insurance through a company in CA that specializes in Fulltimers

The first 8 months while DH was still at his job we did have to pay taxes in Kansas but because of the tax rules we became "part-year" residents.

Now, this was all in 2010 and I know the loan laws and rules for RV's have changed. So you will need to find a loan company that specializes in RV loans. When we traded in 5er this year for a MH we used Good Sams and the process was easy peasy and the finance rate was excellent.

With all that said and it being our situation only, you will still need to check the laws in your present state.

Doris

Jhoynacki · RV-Dreams Community Member

Home will be sold July 15th and we are planning on becoming SD residents. Question: SC where we live today we have a $300 cap on sales tax for cars, trucks, fifth wheel, etc. as they make it up on annualproperty tax bill. So if we become SD residents, do I have to pay the sales tax on my 2004 Chev. 3500, my 2010 Mobile Suite and 1 other car?

RVKevi · RV-Dreams Family Member

Jhoynacki, if I remember right, if you've owned it for over 6 months, you don't have to prove payment of sales tax, but I'm not at all sure of that. Your mail service would probably be able to answer that.

Clay L · RV-Dreams Family Member

When we registered our 2004 coach and 1999 car in SD in 2006 we had to pay 3% of the current value of each one. They were previously registered in NH which has no tax on cars or motor homes when you buy it. As I recall SD used the NADA value.

Of course NH makes up for that (and a lot more) by charging very high plate fees each year. For example my coach and car combined cost me $1800 in 2004.

The combined cost in 2006 in SD was $186.

-- Edited by Clay L on Tuesday 11th of June 2013 10:50:40 AM

RVKevi · RV-Dreams Family Member

Oh, maybe we didn't have to show proof because we came from NC, which has a 3% sales tax on vehicles. So I guess it depends on where your vehicle was previously registered.

Clay L wrote:
When we registered our 2004 coach and 1999 car in SD in 2006 we had to pay 3% of the current value of each one. They were previously registered in NH which has no tax on cars or motor homes when you buy it. As I recall SD used the NADA value.

Of course NH makes up for that (and a lot more) by charging very high plate fees each year. For example my coach and car combined cost me $1800 in 2004.

The combined cost in 2006 in SD was $186.

-- Edited by Clay L on Tuesday 11th of June 2013 10:50:40 AM