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State Law Targets Tax Loophole
DES MOINES, Iowa (AP) -- Iowans have lost a tax dodge for their luxury motor homes.
Legislation passed this spring toughens a state law aimed at ensuring Iowans pay a 5 percent fee on new-vehicle registrations.
Violators can be charged with fraudulent practices and fined as much as 75 percent of the fee.
The law keeps Iowans from registering the vehicles in Montana, where out-of-state residents legally can set up a shell company and register a motor home there. Montana doesn't charge general sales taxes.
The new Iowa law says that if a vehicle owned by a nonresident is located in Iowa for more than 90 days and is operated by an Iowa resident during that time, the vehicle is not considered to be in the state temporarily.
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