Good weekend to my leashackrs!
For all of my people in Georgia is there any loopholes around the paying tax on the total price on a vehicle? This makes it real difficult to get good deals when leasing vehicles.
I was looking at a tesla model x yesterday and paying over 7k in taxes just messes up the deal.
I have an LLC based in Nevada. Anyway I can buy the car using my LLC and not have to pay all taxes?
It would have to stay registered in another state to avoid paying the TAVT. Even if it was registered in another state and then registered in GA, the TAVT would be levied. Residents in GA that bought a car here, paid the TAVT, moved to another state while registering it there, and then moved back to GA would probably have to pay the TAVT again. It really is a dick move IMHO.
I can’t speak to whether the tax can be rolled into the lease, but the TAVT definitely gives pause to the idea of leasing a vehicle in GA.
Yup. Have your Nevada llc lease and register the car. Better still do it in Montana.
Thanks guys. Anyone have experience doing this successfully
IANAL
There used to be a lot of this happening in CA back in the day where people drive up to WA to pick up their vehicle and drive it down. I have heard that this is not an option anymore.
If you have an LLC in Nevada (same as Delaware), most likely that LLC does not have an operations in NV. If you do business using that LLC in GA, you would likely have to file a “Foreign” LLC which brings you back to GA. Even if you successfully do this, is $7k worth the risk of having to pay the tax (+ penalties) – your call? The chances of this being uncovered is probably less than the chance of your vehicle getting totaled but again, is $7k worth it?
I had an offshore entity setup before and my accountant (that I pay a ton of money for to maintain this) even told me to shut it all down as it was not worth it. Plus, my mentors have said “why are you raising your hand to get audited”? My accountant who does this for large firms and public firm auditors (now getting paid a lot less) advises me to just take the 60 cents from my dollar and go play. Probably one of the most painful things to hear but most likely is the best advice.
In the same way, putting a vehicle on your LLC may “raise flags” (for example: you need to file that foreign LLC paperwork in GA to do business) but again, I’m sure the government has bigger fish to fry than dealing with their $7k in lost tax revenue.
All that a judge or an auditor will ask was what was the intended purpose of the LLC and the vehicle.
It will work but you must be able to prove to a reasonable person that the LLC was not set up for the sole purposes of a tax shelter. In other words, do you have legitimate dealings in Nevada? Does the car serve a legitimate business purpose for the Nevada LLC? For example, does the Nevada LLC provide use of the car to its owners/employees to attend sales meetings,service calls or conferences in Nevada?
If the Nevada LLC has no other business dealings and assets other than the car and the car has never been used in Nevada, then it will be plain to see it is a shell for tax avoidance. But if the LLC has legitimate dealings that require the use of a vehicle, then its purchase and registration in Nevada by the LLC is legitimate.
Check with your lawyer or educate yourself for further details.
Example 1. A Nevada LLC buys/leases a pickup truck. That truck is used to make monthly or quarterly deliveries to the LLCs customers in Nevada. In between deliveries, to save on cost, the LLC agrees that the owner/employee in California shall garage and maintain the car and allows for personal use. To me, that is legit.
Example 2. A Nevada LLC buys/leases a Porsche. The Porsche is not used in Nevada for 2 years and has no logs associated with it that show any business purpose. To me, that is tax evasion.
+1 … 20 chars
Thanks for the advice. It sucks that California and other countries get these breaks but we in Georgia our screwed. Paying so much tax for the entire vehicle, not just the depreciation part.
Might just make more sense to buy here.
I agree - states that have tax on the whole value would not be ideal for leasing.
You are welcome to move to Montana where there is 0 tax on vehicles 
It is not a huge difference until you get to around $30,000 and higher, which is about the average transaction price these days of about $34,000. At least in VA the tax is only 4.15%, not sure about other full tax states.
The cars I’m looking at are 60k plus.
I was at the MB dealership this morning where my sales rep told me that the law was changed this session but it only goes into effect in July. Coincidentally I was on a flight with the owner of a Toyota dealer last week who told me it didn’t pass. But worth looking into and taking into consideration with your timing.
Unless you have a valid reason (other than to dodge taxes) for registering an LLC in Montana, I would suggest otherwise. This is especially true if you have a nicer car that may attract more attention. I had a friend who did this who often leased McLaren’s. He wasn’t audited but rather someone actually reported his plate (presumes it was one of his neighbors).
He affirmed immediately to being in the wrong and hired a good lawyer so he wasn’t prosecuted further. He got out without any charges other than a few fines &paying ALL of his taxes back for every vehicle he leased using the fake Montana LLC.
While he saved a lot of money over time, he actually had to sell one of his other exotics to foot the $100k+ in taxes that he now owed.
Not to mention legal bills
You got me curious on this. Apparently, the topic of the TAVT negatively affecting leases came up for this legislative session. If I understand things correctly, an amendment was passed this past Friday the 7th to tax only the lease payments and not the sale of the vehicle. If I read it right, it should be sitting on Gov. Deal’s desk to be signed and would go into effect January 1st. So might be worth waiting if you can wait.
Link to bill: http://www.legis.ga.gov/legislation/en-US/Display/20172018/HB/340
F that crappy neighbor. I wouldn’t want to live there after that. You need an estate to prevent this kind of BS so you don’t have a neighbor for a few miles.
I know. He always took his car to the local Cars 'n Coffee; I think it might have been someone from that personally. Rolling up in a bright orange McLaren in PA with a blue Montana plate was likely not the best idea. Only takes one jealous onlooker with half a brain to realize what was going on there. Maybe in something like a Maybach you could pull it off but not in a car that grabs attention like an orange McLaren.
F the a**hole dodging $100k in taxes. Whose pocket is that deficit coming out of?
I’m sorry that we live in a free economy where States can choose what to tax and what not to tax. He wasn’t avoiding federal taxes he was not choosing to pay State taxes. That’s life living in a republic - he paid the price.
You need an estate to store all your cars 