Are You Ready for Another Snowbird Tax?

In recent stories I reported that the governor of two northern states have declared war on the so-called rich snowbird.

NoNewTaxesGovernor Mark Dayton of Minnesota proposed a snowbird tax on residents who live 60 days to just under six months in the state.

Dayton told snowbirds that since you’re rich, you can pay more.

“It’s time snowbirds paid their fair share,” he stated.

In a separate story the Iowa Senate approved a bill intended to prevent tax evaders (their words, not mine) from using out-of-state shell corporations to avoid paying registration fees on million-dollar recreational vehicles and other luxury vehicles.

In the most recent development this new rule affecting all current and future RVers was inserted in a catch-all bill approved by Iowa legislators.

And now a third state proposes a plan to squeeze more tax dollars out of the so-called rich snowbird.

Nevada lawmakers are looking to see if they turn up more cash from snowbirds. Already the state mandates that anyone of the age of 10 who resides in the Silver State for more than 31 consecutive days must purchase a seasonal identification card at a cost of $12 (reduced to $7 for seniors).

However, if Nevada AB405 is passed into law, that mandated fee will jump to $17 for all, the RV News Service reported.

Relax and enjoy the beauty of Gulf State Park. © Rex Vogel, all rights reserved
Relax and enjoy the beauty of Gulf State Park. © Rex Vogel, all rights reserved

Even more odious is what’s hidden in the fine print in the bill: Bring a vehicle into Nevada, you’ll need a seasonal decal, at $18 per year. Bring your Class A motorhome and a tow vehicle, make the total decal bill $53.

The Nevada Assembly voted 40 to 1 to send the bill to the Senate for its consideration.

In an article carried by the Mojave Daily News, tourist promotion officials are shown to be more than a little concerned.

“Assembly Bill 405 reminds me of the issue with the RVers and dry camping back in 2006,” said Connie Davis, executive director of the Laughlin Chamber of Commerce.

“The economic impact that issue caused was tremendous, due to the fact that the RVers went national with the message that Laughlin doesn’t like RVs. To this day, we still haven’t recovered.

“Snowbirds and RVers bring in tourism dollars to Laughlin and the whole Tri-state area,” continued Davis.

“The perceived benefits from AB405 won’t outweigh the negative effects. Those folks will go spend their money elsewhere.”

The bill is the brain-child of sponsor Assemblyman Richard Carrillo, D-Clark County.

You may all go to hell and I will go to Texas.—David Crockett © Rex Vogel, all rights reserved
You may all go to hell and I will go to Texas.—David Crockett © Rex Vogel, all rights reserved

In an ironic twist, a view of Carrillo’s web page lists the Alliance of Retired Americans as one of his affiliations.

Just another one of those initiatives where politicians say “they’re rich, let them pay more.”

As one of “them” I can assure you I will visit another state before I will pay Nevada one dime.

The proposed tax grabs by the states of Iowa, Minnesota, and Nevada draw the contrast of what is happening in United States today. At least, let’s hope it is not a trend.

Maybe, it’s time to move to Texas!

Worth Pondering…

In my many years I have come to a conclusion that one useless man is a shame, two is a law firm, and three or more is a congress.
—John Adams

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Iowa Hides RV Registration Fee Tax Grab in Catch-All Bill

In recent stories I reported that the governor of two northern states have declared war on the so-called rich.

nelson_haha2Governor Mark Dayton of Minnesota proposed a snowbird tax on residents who live 60 days to just under six months in the state.

Dayton told snowbirds that since you’re rich, you can pay more.

“It’s time snowbirds paid their fair share,” he stated.

In a separate story the Iowa Senate approved a bill intended to prevent tax evaders (their words, not mine) from using out-of-state shell corporations to avoid paying registration fees on million-dollar recreational vehicles and other luxury vehicles.

Iowa Senator Tod Bowman, a Democrat from Maquoketa, said Senate File 364 will make it easier to crack down on those who deliberately evade paying registration fees.

The bill was approved on a 46-2 vote and sent to the House.

In the most recent development this new rule affecting all current and future RVers was inserted in a catch-all bill approved by Iowa legislators.

How will this new tax affect the lifestyle of Iowans? (Source: theveganmom.com)
How will this new tax affect the lifestyle of Iowans? (Source: theveganmom.com)

Bowman says it’s a crackdown on tax evasion, radioiowa.com reported.

“What this will do is close the loophole by addressing a sham or a shell fake (limited liability) corporation specifically being in place in the state of Montana,” Bowman says.

“We’re talking about million-dollar RVs or luxury vehicles that are being registered out-of-state, but they’re being driven in the state of Iowa, they’re maintaining residence in the state of Iowa, but they’re getting through this loophole and not paying their user fee.”

Montana does not charge sales tax, so people around the country have set up corporations in Montana to avoid paying their home state’s sales tax on the purchase of expensive motorhomes. Bowman says some Iowans are using that loophole.

“If you’re talking about a $25,000 vehicle, that might mean $2000, but if you’re talking about a million dollar vehicle, it’s $50,000,” Bowman says.

The proposal that has cleared the legislature makes it a crime for an Iowa resident who does not use their RV to do business for a Montana-based corporation to evade Iowa taxes by registering their motorhome in Montana. Bowman says motorhomes create wear and tear on the state’s roads just like other vehicles and the state sales taxes paid on motorhome purchases help finance road repairs.

“That money goes directly to our Road Use Tax Fund,” Bowman says.

“We all know the need in our Road Use Tax Fund.”

Sales taxes on motor vehicles and state taxes charged on motor fuel are deposited in the state Road Use Tax Fund, but officials say the fund is at least $250 million short of covering the amount of repair and construction needed in Iowa’s road system.

Some states have set up tip lines for residents to call in and report on neighbors who have an RV with Montana plates.

camper-bike-6This motorhome sales tax issue was included in a huge bill that cleared the legislature on its final day. Governor Branstad has the authority to item veto sections of the bill and he routinely refuses to say in advance whether he’ll approve or veto proposals.

The proposed tax grabs by the states of Iowa and Minnesota draw the contrast of what is happening in United States today. Maybe, it’s time to move to Texas!

Worth Pondering…

Even if the majority agrees on an idiotic idea, it is still an idiotic idea.

—Sam Levenson

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Are You Ready for a Snowbird Tax?

The governor of a northern state is proposing a snowbird tax on residents who live 60 days to just under six months in the state.

Minnesota in winter (Source: minnesota.publicradio.org)
Minnesota in winter (Source: minnesota.publicradio.org)

Spend most of the year in Florida, Texas, Arizona, or another Sunbelt state, and a snowbird smack down could be your new reality.

Governor Mark Dayton of Minnesota is proposing a snowbird tax as part of a larger tax grab by proposing to increase Minnesota’s personal income tax rate to 9.85% from 7.85% on income above $150,000 for singles and $250,000 for joint filers.

Minnesota’s income tax rate would be the country’s sixth highest.

Dayton tells snowbirds that since you’re rich, you can pay more. It’s time snowbirds paid their fair share!

Dayton, a Democrat, proposed the idea last month when announcing key parts of his proposed $37.9 billion budget.

He made a similar proposal last year that was defeated by the then-Republican-controlled legislature.

The plan would purportedly raise no more than $30 million over two years from all Minnesota residents who live 60 days to just under six months in Minnesota by taxing their capital gains and dividends as well as income from stocks and bonds.

The prorated income tax would largely hit older residents and retirees because they leave northern states to establish residency in such warmer places as Arizona and Florida.

Yuma, Arizona in winter © Rex Vogel, all rights reserved
Yuma, Arizona in winter © Rex Vogel, all rights reserved

According to Dalton’s logic it’s unfair that somebody can live six months and a day outside of Minnesota and pay no state personal income taxes, then come back and take advantage of “all the state has to offer for five months and 29 days.”

“This is a snowbird tax—absolutely,” he told reporters.

Apparently in Dalton’s world it matters little that seniors have worked for upwards of 35 years contributing to the state economy and paying taxes and scrimping and saving in order to enjoy their senior years in a warmer climate.

The purportedly first-of-its-kind tax would be difficult to enforce and is already facing opposing from state Republicans.

The hassle factor will be enormous, with the taxmen presumably demanding proof of location during the year via the likes of golf or restaurant receipts, reports Wall Street Journal.

When revenue invariably doesn’t meet expectations, maybe Dayton can require a GPS locator for grandma’s cellphone.

But raising revenue isn’t the point of this exercise. In the governor’s own words it’s about “unfairnesses”. The goal is to punish people for the sin of being able to afford to travel south for the winter.

“I don’t even think that’s constitutional,” Senate Minority Leader David Hann told the MinnPost.com.

“I don’t even know how you’d do that. (And) as far as I can see, there’s not a lot of money attached to it.”

FoxNews reports that a Florida Republican congressman is welcoming to his home state Minnesota residents who migrate south to escape the Midwest’s notoriously cold, harsh winters—now that their governor is trying to impose a so-called “snowbird tax” on them.

“Dear Governor Mark Dayton,” Rep. Trey Radel wrote.

Winter in Florida © Rex Vogel, all rights reserved
Winter in Florida © Rex Vogel, all rights reserved

“I’m writing today to thank you. As a Floridian, I am overjoyed to hear about your plan to raise taxes on Minnesotans, most especially the so-called ‘snowbirds.’ Your proposal gives us a chance to shine here in the Sunshine State.”

Radel, argues in the letter, which appear written with pointed sarcasm to skewer higher taxes, that southwest Florida would welcome more entrepreneurs and philanthropists investing in the region. And he cited such incentives as no income taxes, investment incentives for big and small businesses, and “great” public, charter, and private schools.

“It’s my sincere hope your plan has just driven many Minnesotans to become year-round residents of our great state,” he wrote. “I thank you for your policy.  It draws the contrast of what is happening not only in United States today, but the world.”

Worth Pondering…

Even if the majority agrees on an idiotic idea, it is still an idiotic idea.

—Sam Levenson

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