briand said:Could someone explain to me what you guys are talking about? Is it some kind of "final" bill of sale you get after you buy the last of the kits from Van's? I'm confused, I remember reading in the FARS that a Signed Bill of Sale is required for airworthiness, is that it?
Then when you least expect it they will come and ask you for their due sales/use tax. I paid Ohio use tax on my 2001/2002 purchase and will again pay them for 05 when I got my engine, prop and other finish items. So that was an approximately $3600.00 I had not counted on.
aadamson said:There is sales tax, and then there is use tax. If they don't get you for sales tax on the LLC idea, they *will* get you on use tax. YOu see, if you buy it thru an OR LLC and don't pay sales tax, then when your change the registration to TX, you get a bill from the state for USE tax on the sale.
mdredmond said:So...
Okay, just figured it out. Creating an Oregon LLC costs $50 if you're willing to spend 3 minutes to fill in the form. You can pay someone else $200 to do it for you. The LLC buys all the parts. In the end, the plane is bought from the LLC for whatever you feel like paying - that's the amount you'll pay sales tax on. That's it, there's nothing else to it.
aadamson said:Followed your exact scenario, even waiting a number of years before the LLC sold it to me. State retrieved the original sales records, saw that it had paid not sales tax (delaware LLC).... When it was *resold*, state used fair market value instead of the price paid and came after their use tax.
mdredmond said:...No offense to any of you out there, but government employees are one or more of (a) too stupid, or (b) too lazy, or (c) not mandated to determine an item's value - they just use sales documents to levy taxes...
Davepar said:Does the Van's license agreement need to be signed/notarized in order to get the bill of sale from them?
mdredmond said:My point is: by controlling the Oregon LLC, you can sell the airplane to yourself for whatever amount you wish, that amount being that used to calculate the sales/use tax you owe your home state.
mdredmond said:So...
What's to keep you from registering the completed plane to your Oregon LLC (based at Mail Boxes Etc. in Portland - Oregon has no sales tax) and then purchasing the plane from that LLC for $2000? In Texas, you'd owe a whopping $120 in sales/use taxes instead of $3000+.
Update:
Okay, just figured it out. Creating an Oregon LLC costs $50 if you're willing to spend 3 minutes to fill in the form. You can pay someone else $200 to do it for you. The LLC buys all the parts. In the end, the plane is bought from the LLC for whatever you feel like paying - that's the amount you'll pay sales tax on. That's it, there's nothing else to it.
RatMan said:Maybe this is a really stupid question. You seem to have put a considerable amount of thought into how to get around paying what you owe, why?
Rat
Deuskid said:There are 1/2 dozen legal, corp. law and income tax issues associated with doing this. Short answer: it doesn't work.
John
mdredmond said:B. There is precisely NOTHING about my spending 2000 hours to build a plane that entitles my fellow citizens to come tax me for it. Now if they'd like to help me build it, then I'll reconsider.
As far as I know, there isn't any sales/use tax on the hours you put into the plane. Only on the parts that other people made for you, Vans, Lycoming, Garmin, etc.Not trying to start a flame war. Just pointing out a small flaw in your logic. Personally, I'd like to avoid our 9% sales/use tax as well.