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Minnesota Going After RV Buyers Evading State Sales Taxes

November 17, 2011 by   - () Leave a Comment

The Minnesota Department of Revenue believes a small group of residents are attempting to evade paying sales tax on high end recreational vehicles by registering them in Montana, KARE-TV, Minneapolis-St. Paul, reported.

Motor vehicles are subject to the state’s 6.5% sales tax and the vehicles need to be registered in Minnesota. The rule applies no matter where the vehicle was purchased.

The agency says Minnesota residents are setting up shell corporations in Montana to purchase the RV and register the vehicle in Montana. The price of the motorhomes involved ranges from $150,000 to over $1 million.

The tactic violates state law and any resident caught evading sales tax could face gross misdemeanor or felony criminal charges. They would also have to pay the sales tax, as well as any penalties and interest.

Since October 2010, the revenue department has closed 22 cases and collected $230,000. Currently there are 270 cases under investigation. The agency is working with Montana authorities, Minnesota State Patrol and the state’s Department of Public Safety Vehicle Crime Unit.

Those who have not paid taxes on a recreational vehicle should contact the Minnesota Department of Revenue at (651) 556-6684 or visit the Department of Revenue website.

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