Storage of Motor Home in Tennessee Created Nexus for Montana LLC

Tuesday, December 2nd, 2014

 
 
Share
Link
Tennessee
General

The Tennessee Court of Appeals ("Court") recently ruled that a Montana LLC had nexus with Tennessee because it stored a motor home in Tennessee for six months a year.

The taxpayer was a Montana LLC. The owner and only member of the LLC had a home in Tennessee. The LLC purchased a motor home to use outside Tennessee as a mobile office. Starting in 2007, the LLC stored the motor home in Tennessee at the LLC owner's home for six months out of the year. The LLC only drove the motor home in Tennessee while going to or from other states. The LLC only used the motor home as an office in other states.

A state can only require an individual to pay or collect tax if that individual has "substantial nexus" with the state. An out-of-state individual must have some physical presence in a state to have substantial nexus.

The Court ruled that the LLC had substantial nexus with Tennessee. The LLC stored the motor home in Tennessee for six months out of the year for around seven years. The LLC also used the motor home for transportation in Tennessee, even if only briefly. The Court ruled that this was enough physical presence for the LLC to have substantial nexus. Tennessee could therefore require the LLC to pay tax on its purchase of the motor home.

http://www.tncourts.gov/sites/default/files/mccurryexpeditionsopn.pdf


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Washington Penalty Reduction Program

Monday, May 21st, 2018 -Businesses that apply to register with Washington's Marketplace Fairness Penalty Reduction Program by June 30,...

Cloud Software No Longer Taxable in Indiana

Thursday, May 17th, 2018 -Effective July 1, 2018, cloud software will no longer be taxable in Indiana. Indiana taxes the sale, lease,...

Sales Tax Increase in the Historic Triangle Region of...

Monday, May 14th, 2018 -Effective July 1, 2018, there will be an additional one percent (1%) regional sales and use tax imposed in the...

Sales by Charitable Organizations Generally Exempt in...

Friday, May 11th, 2018 -The Arkansas Department of Finance and Administration recently addressed the taxability of sales made by a non...

Credit Card Convenience Fees Taxable in New York

Wednesday, May 9th, 2018 -The New York Department of Taxation and Finance recently ruled that convenience fees for credit card purchases...

Farming Exemption Does Not Apply to Residential Gardening...

Monday, May 7th, 2018 -The Arkansas Department of Finance and Administration ruled that a utility vehicle used for residential garden...