When should we start fulltiming?

[DonandBonnie]

It seems that using South Dakota for a domicile makes good financial sense. In our situation we will have to sell the stick house before we buy the Monty. We will then be fulltimers. I can't retire until the end of June, 2008, 18 months from now (539 days, not that I'm counting). Can I use South Dakota to legally avoid paying Ohio taxes and fees on the Monty before I retire and if so, how long before I retire can I do it? I know I will have to get some legal advice before we make the move, but hopefully we can get an idea of which direction is best.

[stiles watson]

When I looked into what I would receive if I retired early and what I would recieve if I waited until 65-1/2, I found that I would have to be 85 years-old before the losses from the reduced amount would equal the gains I would receive from retiring early.

It sounds to me like you are 63 or 64 and counting. A call to your Social Security Office and a visit to your personnel department may reveal some surprisingly positive answers about taking early retirement. Of course being an RR man may mean you have a different retirement system. I would still ask a lot of questions.

If I am right in my guesses, then you could put the stick house up and retire at approximately the same time as your closing. Then, walla, you are fulltime.

Someone better qualified can address you taxation concerns.

[DonandBonnie]

There are ways to leave the railroad before retirement without affecting the pension, however, health insurance is another matter. We can retire at 60, but are not eligible for medicare until 65. My employer will cover our health insurance until 65, but only if I stay until I reach age 60. If I go early, my pension will be ok, but I'll have to pay my own insurance until age 65. That's a no brainer. I'm just looking for info on when we can begin fulltiming in South Dakota without incurring the wrath of the Ohio tax gestapo.

[stiles watson]

Thanks for the clarification. I believe we are allowed to have a second residence even if it is in another state. Therefore I would assume that if you bought a Montana in SD under a SD address and registered in SD, that it would not be taxable in Ohio. If you buy it is Ohio, unless I am mistaken, state sales taxes are site taxes regardless of domicile and are collected by the selling entity. I am a little foggy on this so I really hope a tax person will chime in.

[FulltimeFollies]

If that is legal, how about getting a bank account in a state that has no income tax, and have your checks deposited direct, regarless of what state you live and work in. Sure save a lot of state income tax. I would not want to try it.

You may want to look into a Montana LLC, cost around 1200-1300 to do it, plus 125-150 year maintainence , dont kow if that is worth it or not.

[sreigle]

I'm not so sure Ohio would buy into that. I know in Kansas they occasionally "catch" someone who live in Kansas but have their vehicles, including RV's, registered in another state, avoiding the high Kansas personal property taxes. When they catch them, they get all the back taxes and punitive assessments.

On your income, you're going to pay tax on the state in which you live as well as in the state in which you earned the income. Since SD does not have a state income tax, you would only be paying in Ohio.

We became SD residents after getting a contract on the house and about three weeks before closing. We already had the Montana and truck so just switched them to SD that 3 weeks before closing.

[MAMalody]

I'm not going to go into the follies of some of the representations above, however, I would say,
1. "tell it like it is" and you won't have to worry about any state/federal agencies
2. research the states that may give you the best bang for your buck
3. find out that states way of being legal.

As an aside, CA waits for the Montana LLCs. While they can be a benefit, CA nails many of them every year that are not handled correctly.

[DonandBonnie]

Thanks Mike, I'm looking for advice to minimize taxes and fees legally, not pull a fast one that I have to worry about getting caught. I was just wondering if others had any similar experience that they would be willing to share.

[FulltimeFollies]

mamalody, your post reflects discontent with some post , as you say. Let me take a word to express my opinion of yours.
We can continue this banter, but to no avail as it is responses to post that stimulate free flowing thoughts and opinions, where most people learn. Nor do I need your post to challange the opinions of posters. For the future, if you do not like the responses given, why not simply notify the moderators of your feelings and let them do their duty? Or do you hold a "posting police" badge.

DonandBonnie.
The "follies" as listed above doesnt evade taxes. Nor does he ask on a rv forum how to evade taxes. If you desire to do so, I am sure there are other avenues and ways to "cheat" your home state of it"s rightful share of your wages.
You may classify it as "avoiding" or "limiting" taxes as you wish. There are movements nationwide and statewide that are instigated to stop just this type of evading taxes. If you ask the question and someone replies with their opinion, you should either accept the opinion or dont ask.
Our country is based on law and the rule of law. If you dont like the laws and the rules, then elect people to change those laws. Looking for a way around the front door is wrong.
You take the benefits of your state, pay your share. You reside in Ohio, you earn your living in Ohio, you utilize the benefits of Ohio, yet you want to evade taxes on an rv by registering it in another state, using a ficticious address to do so. Give me a break! You are certainly old enough and wise enough to post, purchase and use an rv, you should certainly be wise enough to know this is wrong. Nor does it belong on a public forum for rving with certain brand rvs.
Oh ,these are just my opinions.

[DonandBonnie]

Let me see if I can straighten this mess out before it degenerates any further. Several years ago we moved from Missouri to Ohio. We paid Missouri taxes for everything that was owed or earned in the state of Missouri. After that we paid the same in Ohio. Missouri was not "cheated" out of further income because we moved. At some date in the near future we are going to "move" again from Ohio to South Dakota when we begin fulltiming. At that time Ohio will get everything it is owed. We will make a proper decision on when to sell the stick house and buy the Montana that makes legal and financial sense. The tax codes are written to permit legal methods of minimizing taxes. They are called legal deductions (or loopholes if someone else gets them and you don't). That is also why, when you move to a new locale, you no longer have to pay taxes in the prior location. Let me make it clear here. I will take advantage of every law that allows me to minimize what is owed to the government, any government. I will not commit fraud in order to accomplish that goal!

[stiles watson]

Well said, Don. You express my efforts also. I will pay what I owe to the entity I owe. But if I am given an exemption by law, I will take every penny. My quest is to determine the law.

[HomeOnTheRoad]

This thread has turned negative and is not the tone we want in the Montana Owners Club. This topic is locked.