Posted 2012-02-13 10:08 AM (#140853) Subject: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
I need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
Posted 2012-02-13 10:30 AM (#140855 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Expert
Posts: 3853 Location: Vermont
Originally written by cdsgreen on 2012-02-13 10:08 AM
I need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
Posted 2012-02-13 11:26 AM (#140861 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Extreme Veteran
Posts: 350 Location: Penrose, Colorado
all horse-stock trailers are ag exempt in Oklahoma,here we do not have to buy license plates either all we are supposed to do is have the DL number on the trailer, you can put a private tag on for about $10 a year and all you have to do is have the trailer Mfg. and year not even a vin number as Oklahoma is a non title state on trailers. I always thought Texas was about the same.We have a private trailer tag on our LQ just to not get hasseld out of state.
Posted 2012-02-13 12:04 PM (#140863 - in reply to #140855) Subject: RE: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
I read your reply and I appreciate all the info. If I am reading this right, you have your customer sign state form...14-305 to exempt them from taxes. If I sign this form when I purchase this trailer, does this exempt me. That form states it is for rentals unless I have read it wrong. I have purchased LQ trailers for the past 30 years and I have never paid taxes on them. Thanks for your help. Any further input would be appreciated.
Posted 2012-02-13 12:35 PM (#140864 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Extreme Veteran
Posts: 402 Location: Lockport, Illinois
If you use the LQ for 80% ranch use as described and prove it, then you would be tax exempt as described.This is the last sentence of the first paragraph and states if you use it for pleasure you pay taxes. Transporting horses to race tracks, rodeos, livestock shows or contests, etc. does not constitute an exempt use of the trailer even if the purchaser owns or leases a farm or ranch and is in the business of raising and selling agricultural products in the regular course of business.
Posted 2012-02-13 1:03 PM (#140867 - in reply to #140864) Subject: RE: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
I did read that transporting, etc. did not exempt the buyer from taxes. I was curious, so I called the comptrollers office. I received a couple of answers. One was that if it was used for show, like show cattle, that animal would eventually be slaughtered, or sold, so it could be exempt. I am even more confused at this point.
Posted 2012-02-13 2:06 PM (#140870 - in reply to #140853) Subject: RE: taxes on living quarter trailers
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Posts: 14
Location: Tx
This is the first year the state of Texas started charging sales tax on horse and stock trailers. You have to have the new AG/TIMBER number now on the title app to be exempt from sales tax, in the past they did not require a number, all we had to do is check the farm use exempt box, you can goggle ''Get Ready Texas'' and it will take you to the web site to apply for your AG/Timber number. In the past Horse's, donkey's, Mule's etc.. were not considered agricutural but they are now as of Sept 1 2011. I have been selling trailers in Texas for 20 years and didn't think was going to happen but it did.
Posted 2012-02-13 2:20 PM (#140871 - in reply to #140870) Subject: RE: taxes on living quarter trailers
Expert
Posts: 3853 Location: Vermont
Originally written by BLM on 2012-02-13 2:06 PM
This is the first year the state of Texas started charging sales tax on horse and stock trailers. You have to have the new AG/TIMBER number now on the title app to be exempt from sales tax, in the past they did not require a number, all we had to do is check the farm use exempt box, you can goggle ''Get Ready Texas'' and it will take you to the web site to apply for your AG/Timber number. In the past Horse's, donkey's, Mule's etc.. were not considered agricutural but they are now as of Sept 1 2011. I have been selling trailers in Texas for 20 years and didn't think was going to happen but it did.
Yes...but he was discussing a trailer with living quarters...which is a TOUGH SELL to meet the 80% use rule for the exemption...
Posted 2012-02-13 2:46 PM (#140873 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 26 Location: Decatur, TX
This is an issue that is getting high visability in 2012. As a dealer we have spoke to our Texas Representative and they have clear as day said that no LIVINGQUARTERS is able to be tax exempt. They are actively pursuing this issue and have been making it very clear to the registration offices and contacting dealers and indivduals who have not been registering their livingquarters trailers with taxes being charged. If you are purchasing a trailer WITHOUT sleeping quarters you can put a tax exempt tag on the trailer with a tax exempt ID number, but if it has any sleeping quarters it is against the law to file it as a tax exempt trailer. This is becoming the norm as of this year and you start seeing everyone in Texas follow suite. There are HEFTY fines for not paying the tax on the trailers if caught. It is a much better idea and most dealers are requiring you to go ahead and register the trailer as a taxable trailer than to pay the penalty later. Please let me know if you have any questions on this as we have been studying this and have spoken directly with texas law on this matter. Thank you Krista NRS Trailers
Posted 2012-02-13 3:27 PM (#140875 - in reply to #140873) Subject: RE: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
Krista, Is this the first year everyone in Texas is required to pay sales tax on LivingQuarter trailers??? I've have always put a $5.30 farm tag and title fees.
Posted 2012-02-13 4:20 PM (#140877 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 26 Location: Decatur, TX
This law has been in effect for some time but they have been strictly reinforcing it this year and making sure everyone follows suite. To where our registration offices WILL NOT register the livingquarters trailers as a tax exempt. So it is now being reinforced to the highest degree. Just like tax on a vehicle it is going to be the "norm" now on livingquarters trailers.
Here is the link for the Motor Vehicle Tax Guidebook. It is towards the end of the book (at least 3/4 of the way) on page IV-3 it will state under Not Qualified for Exemption that on a horse trailer with sleeping quarters there is no exemption http://www.window.state.tx.us/taxinfo/taxpubs/tx96_254.pdf
There are some grey areas to Exemption but this is pretty cut and dry and so they are enforcing this to the best of their ability starting this year.
Again it seems this is now be the norm in Texas and you will see everyone following these guidelines or facing high penalties. Please let me know if you have any other questions on this that I can assist with.
Posted 2012-02-13 4:28 PM (#140880 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
Krista
I understand LIVINGQUARTERS. What do you think they (as the state of Texas) do about horse or livestock trailers that have only an AC unit or maybe the dressing room is paneled and insulated with an AC unit on it??
Posted 2012-02-13 5:13 PM (#140886 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 26 Location: Decatur, TX
That is where you get into a "grey" area. That is going to be up to the local DMV and dealer who is registering the trailer. You will for sure need a Tax Exempt Id number to go on the texas application (for any trailer now that you register as a farm exempt). But those are the shades of grey that will be hard to differientiate and will be up to the dealer selling the trailer and the registration offices policy.
Posted 2012-02-13 5:33 PM (#140887 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Extreme Veteran
Posts: 406 Location: Minneapolis, MN
Originally written by cdsgreen on 2012-02-13 10:08 AM
I need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
Posted 2012-02-13 6:25 PM (#140889 - in reply to #140887) Subject: RE: taxes on living quarter trailers
Extreme Veteran
Posts: 402 Location: Lockport, Illinois
Originally written by wyndancer on 2012-02-13 5:33 PM
Originally written by cdsgreen on 2012-02-13 10:08 AMI need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
Posted 2012-02-13 6:40 PM (#140890 - in reply to #140875) Subject: RE: taxes on living quarter trailers
Expert
Posts: 3853 Location: Vermont
Originally written by cdsgreen on 2012-02-13 3:27 PM
Krista, Is this the first year everyone in Texas is required to pay sales tax on LivingQuarter trailers??? I've have always put a $5.30 farm tag and title fees.
Posted 2012-02-13 6:45 PM (#140892 - in reply to #140889) Subject: RE: taxes on living quarter trailers
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Posts: 2958 Location: North Carolina
Originally written by BigT on 2012-02-13 3:25 PM
Originally written by wyndancer on 2012-02-13 5:33 PM
Originally written by cdsgreen on 2012-02-13 10:08 AMI need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
How much money we talkin'?
6.25%...about $2,000 on a $30,000 trailer
Whew !! The link posted by Krista shows no wiggle room. Tax guide book says sleeping area. If it has a bed like area , It's taxed. potty or no potty, A/C or not ALL is taxed. Put some stuff into the "neck over" otherwise it'll be the "sleeping area"
Posted 2012-02-14 8:05 AM (#140909 - in reply to #140890) Subject: RE: taxes on living quarter trailers
Member
Posts: 6
Location: Winfield, Tx 75493
I read the response you attached. I guess my question is, who should be responsible for enforcing it. Our local TAC said as long as a farm exempt paper was signed and we had our exempt number, it could be tagged as farm use. Now I am understanding that this is not so. So who is responsible for enforcing the rules if our local TAC doesnt even know.
Posted 2012-02-14 8:21 AM (#140911 - in reply to #140889) Subject: RE: taxes on living quarter trailers
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Posts: 406 Location: Minneapolis, MN
Originally written by BigT on 2012-02-13 6:25 PM
Originally written by wyndancer on 2012-02-13 5:33 PM
Originally written by cdsgreen on 2012-02-13 10:08 AMI need some help or info. I have recently gone to buy a new living quarters trailer. I am now being told that I will have to pay taxes on this trailer. I have never had to pay taxes on a trailer in Texas before. Has anyone else come across this particular situation? Any comments or help would be appreciated.
Posted 2012-02-14 9:01 AM (#140913 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 26 Location: Decatur, TX
It needs to be taken upon everyone involved to become educated. The DMV's, Dealers, and individuals. This enforcement has been a long time coming and will quickly beccome the rule and will be enforced by everyone involved because if they dont the penalty will be way more than it would have been to just pay the sales tax in the first place. Again if it is not a livingquarters you can just get a tax id number and be farm exempt this is just for a livingquarters trailer. You can still technically get farm tags on the trailer but will have to pay the sales tax. The registration fees are a little bit less than regular tags but it will subject you to possibly getting questioned and pulled over while travelling. I understand the headache of having to spend extra money (thousands in some cases) paying the sales tax but this will be "safer" and point blank the legal answer to do. We deal with state registration all over the country with our out of state customers and very few states can you get away with not paying sales tax on a trailer. Until recently Texas has been one of those states, but times are changing and it is going to be the norm now. There is still a transition period going on so you will have to ask your local dealer or DMV what their protocol is in this situation but per our state representative EVERYONE in the State of Texas is to abid by this regulation.
Please let me know how I can further inform.
Posted 2012-02-14 11:12 AM (#140930 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Elite Veteran
Posts: 714 Location: Minnesota
I have the same question as wyndancer. Is that sales tax a one time fee? Here in MN we pay a 6.875% sales tax when we buy a trailer, truck or anything but food and clothing. That add an extra $2750 to a $40,000 (net) trailer. We also pay for license tabs annually. I just paid $39.75 to register mine for 2012.
Posted 2012-02-14 12:07 PM (#140934 - in reply to #140853) Subject: RE: taxes on living quarter trailers
Member
Posts: 26 Location: Decatur, TX
In Texas it is a one time 6.25% sales tax at time of purchase or at first registration. When you renew you will have some registration/license fee but will NOT have to pay the sales tax every year.
Posted 2012-02-14 12:41 PM (#140936 - in reply to #140930) Subject: RE: taxes on living quarter trailers
Extreme Veteran
Posts: 406 Location: Minneapolis, MN
Originally written by genebob on 2012-02-14 11:12 AM
I have the same question as wyndancer. Is that sales tax a one time fee? Here in MN we pay a 6.875% sales tax when we buy a trailer, truck or anything but food and clothing. That add an extra $2750 to a $40,000 (net) trailer. We also pay for license tabs annually. I just paid $39.75 to register mine for 2012.
Genebob,
As you well know, the People's Republic of MN collects sales tax every time that trailer is sold. Just as it does on every vehicle.