I bought a new F-150 earlier this month and it's almost time to pay the sales tax. I live in Missouri and the sales tax rate for my county is 5.85%. The city i live in tacks on an additional 2%. A friend of mine has lived in a neighboring city for around 10 years and has bought 6 new cars says that he simply tells the person at the DMV he lives in the county (not a lie, but leaves out the fact that he also lives within the city limits) therefore paying the lower tax rate. As i've said this has been going on over the last 10 years and he has had no problems. My wife and I are pretty conservative and don't have the guts to do that, but would like to know how likely it is that he will be caught, what agency would likely catch this, and what the possible repercussions could be. He claims that there is no risk.
2007-07-18 06:35:01 · 5 answers · asked by mrb_2131 2 in Business & Finance ➔ Taxes ➔ Other - Taxes
I live in MO and your "friend" is F-O-S if you catch my drift! When you go to register the vehicle and pay the tax, the folks at the license office will use your physical address to determine what the sales tax is that is due. If you have a RR Box number or your address isn't coded in the system, they'll pull out a map and look it up. If you live inside the city limits, you'll pay the appropriate city tax. If not, you won't.
My mailing address is "Joplin" but I'm located outside the city limits. The system knows from my 911 address that I'm not in the city so I don't pay the Joplin City tax.
If your "friend" is getting away with this, either the folks at the local license office are lazy OR someone is in cahoots with the fraud. Tax fraud will get you in trouble with the state and frankly the $400 you'd save on a $20,000 car just isn't worth the grief.
2007-07-18 10:53:03 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
It depends on where he has his car registration sent to. If he has it sent to his home address, and his driver’s license is at his home address then there is a really good chance he’ll get caught. It is just a matter of time.
Don’t take the chance. Be honest and legal. The fines and prison time for committing fraud is not worth the chance you’ll not get caught and save some money.
2007-07-18 08:29:34 · answer #2 · answered by Robin C 5 · 0⤊ 0⤋
Some states use Zip codes for determining sales Taxes for city /county areas. Don't know if Misssouri uses this system,
but if and when they do, Your friend is looking at being "fried" in state tax court for with-holding complete information for tax evasion purposes which, I think, borders on felony charges. Plus monetary penalties and back taxes.
2007-07-18 07:30:58 · answer #3 · answered by THE Cupid HATER 7 · 0⤊ 0⤋
And what does your crook friend put down for his address for them to send the registration papers to - some mythical house in the country, or his own in which case eventually he's likely to get caught. If he has for example parents in another area and uses their address for his own, he might get away with it.
Risks would be having to pay the back amounts plus fines, or possible prosecution (unlikely) for fraud.
2007-07-18 06:49:34 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
Normally they go by the address you live at.
No risk, how about defrauding the government of the taxes he owes. Purposely leaving out information for personal gain is fraud.
2007-07-18 06:39:12 · answer #5 · answered by Tim 7 · 0⤊ 0⤋