WARNING OF DOING RV BUSINESS IN TEXAS - VIT TAX

A very sensitive and outrageous matter has come up, while doing business in the State of Texas, which merits making all our followers aware. As you know we have pledged to report the Good and the Bad of all matters which we encounter in our RV travels. While some are just a matter of preference (like the benefits of one campground over another, or good places to shop) others are more serious and alarming (such as this one}.

When we purchased our new 2023 Fleetwood Discovery 44B diesel pusher at Motor Home Specialist in Alvarado, Texas, an added charge was added to our contract, stated simply as "VIT". Had it been for $2.50 or something like that, we would not have questioned it, but since it was for $988.49, and we have never encountered it in any other purchase, we had to question it, and we did. The Finance and Insurance (F&I) Manager, Billy Fussell at Motor Home Specialist, explained that it is a new "tax" that the State of Texas imposes on ALL motor vehicles being sold in the State of Texas, which has to be paid by the Buyers, and that it is based on a percentage of the sales price, which the computer calculates automatically. 

It sounded 'fishy' but since we were buying an RV with a specially low price, as long as it closed by the end of the year, with only a few days to go, and because we had no way by then to go to another state to make our purchase, we accepted it. However, 4 days later, during the closing, and with a different F&I manager, Matt Killam, we again questioned the "VIT tax" and were told AGAIN that it is a new sales tax on ALL vehicle sales imposed by the State of Texas, so it is required to be paid.

We were surprised by this added charge for several reasons:

1. This dealership prides itself on the fact that it has no dealer-added fees to the sale price,

2. If this is a sales tax, WHY is it added separately from the "Sales Tax",

3. Why is the entry just titled "VIT" and not with an explanation of what it is,

4. IF it is something new and on the up and up, why was it not disclosed until we questioned it?

After closing on the new RV, and after the New Year holidays, we started to research the so-called VIT tax and found out from the Office of the Attorney General of Texas and the Office of the Comptroller of Texas, that the VIT, which stands for Vehicle Inventory Tax (as in Publication 96-254) is:

1. Considered a Property Tax, and 

2. Imposed against the Dealer(s), NOT against the Buyers.

For your reference, here it is as listed on the Comptroller's website:

https://comptroller.texas.gov/taxes/publications/96-254/vit.php , to wit:

TEXAS MOTOR VEHICLE TAX GUIDE

Vehicle Inventory Tax (VIT)

For local property tax purposes, Texas law requires a motor vehicle dealer’s inventory to be appraised based on the total sales of motor vehicles in the prior year. A dealer must file an annual declaration of total sales from the prior year with their county appraisal district. A dealer must also file a monthly form with the county tax assessor-collector to report motor vehicles sold during the prior month and prepay, to an escrow account, a vehicle inventory tax (VIT) for those sold vehicles.

Property Tax and Not Sales Tax

The VIT is a property tax assessed on the dealer, not the purchaser, and is a negotiable item on the sales agreement. Moreover, the VIT is not, by statute, a part of "total consideration." Dealers may, however, separately list a reimbursement of the VIT on the sales agreement.

For more VIT information, see Publication 96-545, Motor Vehicle Dealer’s Special Inventory (PDF).

Sales Price

If the dealer and seller agree to include a reimbursement of the VIT in the transaction, the VIT reimbursement must be listed separately because it cannot be included in the sales price. Motor vehicle sales tax is not assessed against the separately stated VIT.

The VIT is based on the sales price on Form 130-U, Application for Texas Title and/or Registration (PDF), Box 38, after deducting any rebate, including factory and dealer rebates passed on to the customer. The net sales price in Box 38 is the sales price used for the VIT. For example, if the initial sales price is $20,000 and a $1,000 rebate is available, Box 38 should reflect the $19,000 net figure.

Publication 96-254
(09/2021)

Following all our investigation, it became evident that MOTOR HOME SPECIALIST had committed FRAUD, in misrepresenting the VIT charge as a mandatory tax on the Buyer, not disclosing the truth about the tax, and because there was a finance document (loan) involved had violated Truth in Lending laws..

Bill, not one to leave money on the table, and someone who will not let anyone cheat us, set out to address the issue with Motor Home Specialist and prepare a Complaint Form with the Office of the Attorney General, if they refused to correct their offensive actions.

On 01/13/2023 we wrote an email to the Sales Manager and the President/CEO of Motor Home Specialist, referencing the lies by the F&I Managers, and the unlawful charges by Motor Home Specialist. 

Five days later, on 01/18/2023 we receive a reply from a Giff Akins of Blue Compass RV in Alvarado, stating that the Sales Manager we addressed in our email forwarded the email to him because he and the President/CEO were both away from the office, but assured us that they would respond upon their return in a few days.

By 02/07/2023, having given them 20 more days to respond, without their having done so, we wrote them one last time, advising them that given their non-response, we were continuing with the consumer complaint at the Attorney General's Office.

On 02/09/2023, Giff Akins again wrote, stating that as he is in charge of dealing with consumer relations for all their stores (of which MHS is 1 of 107) and of all the legal matters,  he had taken point on this and that having reviewed the case finds with us that certain procedural errors were made, and offered to refund us our $988.49, and wanted to know to whom the check is to be made and to what address it is to be sent. We said with BOTH names (as on the Buyer's Order), but to let us know when the check is ready and we will drive to Alvarado to pick it up, so we can put this matter behind us as quickly as possible.

During the week that followed 01/30/2023 the area of Dallas / Ft. Worth suffered an ice storm which has apparently created damage to phone lines and communication equipment, so we shall give them a few extra days and hopefully we can bring this matter to an end, with our refund of our $988.49.

However, we wanted to post this on our website to WARN our readers and followers of things to be wary of IF / WHEN doing business with vehicle purchases in the State of Texas. While this (our) problem may be resolved, we would not put it past Motor Home Specialist (or any other dealer) to continue to misrepresent  themselves as to the VIT tax and continue to try to saddle the Consumer with that burden, which was designed to falls on their shoulders, NOT on their consumers. 

The problem is derived because the law states that:

1. It is a 'property tax', NOT a 'sales tax', and as such has no place to be part of a sales contract.

2. While it can be 'negotiable' to be paid in whole or in part by the Consumer, we can't see why a consumer would want to volunteer to pay for something he/she has no legal requirement to do so.

3. It should not state that "dealers MAY separately list a reimbursement of the VIT on the Sales Agreement", as that alone can further confuse the issue. IF ANYTHING, it should say that that dealers MAY separately list a reimbursement of the VIT on the Sales Agreement... IF and ONLY IF the Consumer has signed a written statement to the fact that he is willing to pay to reimburse the dealer for their taxation, and to what amount.. Otherwise it cannot be charged against the Consumer."

Therefore, BUYERS IN TEXAS...  BEWARE. 

IF a Texas dealer tries to burden you with a charge for VIT on your sales contract, read and advise them of the law, and refer them to:

https://comptroller.texas.gov/taxes/publications/96-254/vit.php

  

We left Wyoming to get away from the Cold, Snow and Ice... and except for snow (yet) ended right back in it, in Texas.

When we left Wyoming in November 2022 it was already 5 degrees F, as a nighttime temperature. It was so cold that our whole house water filter froze (thank goodness for PEX water lines). Just the same we figured it was time to get out of Dodge (actually Star Valley Ranch), so we did. We would have left earlier had it not been for Bill's dentist delaying a procedure until then, but just the same, we were glad to have been able to leave then (with 12" of snow on the roof of the 5th wheel, that lasted into Colorado). 

Later we found out what Bill had always suspected, that 5th wheels and trailers are not built as sturdily or are as weather hardy as motorhomes. Everything started breaking down, and re-breaking even after fixing it and replacing some parts with new ones. We had already taken it to the Keystone factory service center to repair a bunch of things, but they would not take care of anything, even though it was under the New Vehicle Warranty. They ONLY do warranty work through their dealers, which have a long 5-6 month waiting list and since they are in snow country, that makes it extra difficult to get anything done. They suggested that we take it to another dealer (like a Camping World, which was where we bought it, but as evidenced in an earlier post, CW did such a poor job of customer service with constant lies, that we were not about to go through that again.  So we had to plan to make our return to Wyoming trip via Goshen Indiana, to be able to get all our Keystone Montana issues (which were multiplying by the week) fixed.  

By contrast, motorhomes ALL have a factory service center, which will take care of New Vehicle Warranty work, right at their factory service center.  Like Keystone, their dealers are also 'supposed to' also do warranty work, BUT the issue with a dealer doing warranty work vs a factory service center is like a housewife (oops... that may be politically incorrect, so let's just say a 'domestic person') cooking a great meal vs a master Chef preparing the same meal. The latter is a professional and can do the same with greater perfection, and less waste of time and products. It is the same with a dealer, whose priority is selling RVs and servicing non-warranty work which they can charge their regular hourly rate for, as well as for parts. Sure, the manufacturer will pay them for doing warranty work, but not to the same amount that they can get for doing the same work to a non-warranty unit. Further, a case in point, we have a friend, Russell, who had just bought a  brand new Tiffin Allegro Bus with a very fancy paint job, which had been badly botched up from the factory. His dealer sold it as is promising that they or any dealer would gladly repair the messed up paint job, under the factory warranty. As it turned out, the dealer said that it would take them at least 20 hours to correct the paint job, BUT the manufacturer  (service center) said they could do it in only EIGHT (8) hours and that is all they were willing to pay the dealer, under warranty work. The only solution was that Russell had to take his new Tiffin Allegro Bus to the factory service center, which thankfully was in Red Bay Alabama, and not in northern Indiana, like most other factory centers.  

Well, as we mentioned in the last post, things started breaking down faster than we could keep track of them and having to live with all the issues for months until we could take it back to Indiana just grew to become unbearable. That, added to Bill's growing dislike of life in a 5th wheel (breakdowns and lack of weather hardiness), we eventually took the opportunity of it being the end of the year to make a super deal on trading the 5th wheel in on a Fleetwood Discovery LXE motor home, which we have had previously and seems to be the best of all the RVs we have had. We kick ourselves every day for having traded out of our 2015 Discovery 40E, but as they say... that's life and how we learn. We too had a Tiffin Phaeton 40IH (sadly bought in 2020, the year that Bob Tiffin sold his company to Thor and no longer cared for his production) and we were so disgusted with all the issues in that coach that when the selling dealer (La Mesa) offered us $3,000 more for it than we had paid for it when new, and they would send a driver to pick it up, we sold it. Yes, it was that bad. Actually Bill was not as disgusted with it as Mary was, but since we were going to give up RVing due to the rising costs of diesel during the Covid era, it seemed like the right thing to do, so we did.

After that, though we had bought a 0.5 acre lot to build on in Star Valley Ranch but didn't build due to the lack and high cost of building materials, we decided (being now literally 'homeless' (no house and no RV) to buy a house. It was the middle of winter (March) in Wyoming, and we were in Red Bay, Alabama visiting the Tiffin factory service enter for THIRD time in 10 months. There weren't a lot of houses available for sale, as even some that are for sale, the listings are removed during the winter. Of what was available nothing seemed worthy of our interest until one morning Mary found this one house that looked really nice and for a good enough asking price, so we asked our Realtor friend, Ed Koontz to go preview it and let us know his thoughts on it. Of course, the exterior was covered in snow, so all he could do was a walk-through on Face Time to show us the place and give us commentary as to what he could see inside. We could tell that it would need some modernizing and some repair, but given Bill's real estate experience and marketing skills we knew we would not lose any money on it and could even make money on it, selling it in two years to benefit from the favorable capital gains tax treatment on a primary residence. So we put an offer for it, which was accepted and we rented a 6' x 12' U-Haul trailer, loaded the freezer and all our stuff from the Tiffin and drove the 2,400 miles back to Star Valley Ranch WY, staying at the Wolf Den Motel (cabins) until closing.

Later, because both our properties (building lot and the house) were located on a golf course, we found out that our Roxy girl is deathly afraid of golfers (people with swinging sticks). Since she is a 'rescue' we don't know what her background is, or what abuses she has faced, so we put our building lot for sale and sold it for a $75,000 profit in just 18 months, without a Realtor. Bill prepared a website for it through which prospective buyers could read up on it and view photos of the lot, from wherever they were and then could come by to see it in person.  He is now preparing another website... www.golfchalet4sale.com, for the sale of the house, detailing all the work we have done to restore it. This way someone who drives by it and sees the For Sale sign, or sees it advertised somewhere, can see it online and find out all about it before needing to show it  to people who are not interested in it. IF they are interested, then they can call to make an appointment to come see it in person, but the majority of the work will already be done, and then all they have to do is 'fall in love with it' and make an offer.... OR better yet say "We'll take it, but we won't pay any more than $1,500,000." 😉

So anyway, here we are in Texas, having come way down South to get away from the freezing weather of Wyoming, and for the last two weeks we have seen temps in the teens for lows and in the 30s and 40s for highs, and had whole weeks where at times the sun does not make an appearance for more than a few minutes, and other times, some days it rains almost 6" in just 1 day and 1-3" other days. For several days we have had to fill the water tank and disconnect the water hose so it does not freeze. Still, we are glad that we have much more weather hardiness in this motor home than we would have had in the 5th wheel.

When in Conroe, TX we always plan to have electronic work done our rig.  This trip is no different.  We had some confusion concerning how the television connections were supposed to work and for some reason, when in the campgrounds in Texas, our Verizon Routers did not have internet access, even though our phones did have access.  So, when we had Sats2Go come to help with our television set up, we asked them about internet access.  They recommended Starlink, stating that they had been selling a lot of the systems to RV'ers.  So, Bill looked into Starlink.  We ordered an In Motion set up for RVs and Sats2Go installed it.  They did a great job and helped us set it up.  We love it!!  We turned off our Verizon Routers and have had zero issues with the dishy.  On the way down to the Colorado River Campground, Mary took the opportunity to try out Starlink internet, while Bill was driving down the road.  It worked perfectly, despite totally clouded skies and pouring rain!  

Once we had Starlink up and running, we downloaded an App (VegaTouch Eclipse) that allows us to monitor all of the systems in the Discovery and turn lights and HVAC off and on as necessary, among other things.  Now if we are away and have to leave Roxy in the motorhome, we can check to ensure that it isn't getting too hot or too cold in the motorhome.  If it is, we can turn on the AC and cool it off for her or turn up the AquaHot (which also manages the heating when temperature is under 45 degrees, or the heat pump A/Cs, when it is over 45 degrees.  Technology can be great!!  

Today, we got our FLORIDA registration sticker for Mary's old TWNTWR Florida license plate, which we have hung on to, since taking it off of the 2017 Ford F150 (Edith 2). We had referred to the 2018 Ford F350, as Edith 3 and then the 2022 Ford Explorer XLT, as Edith 4; BUT, since it is going from Edith 2 to the 2023 Fleetwood Discovery LXE 44B, should we call the new motor home, Edith 3... or Edith 5?. To make matters more complicated, since the F350 would not make a good toad (flat-towed vehicle) and we later came to find out that the 2022 Ford Explorer is no longer flat-towable, we will probably have to trade BOTH the F350 AND the Explorer in on another vehicle that we can flat-tow, that is comfortable for us to ride in, that is a 4x4 to go on the off-road places we like to go to when we are exploring, and that is reasonably more economical. So, would THAT one be Edith 4 OR Edith 6? What are your thoughts on that??

For those that are not familiar with where the name "Edith" came from, when Mary was traveling by herself (as she likes to point out... "BEFORE Bill'), in her 2015 Ford Explorer, she said she would feel silly talking to herself, so she would talk to the car (of course talking to a car makes all the difference) while driving, so she decided to name her Explorer... "Edith" (#1), and that made her feel better about talking to herself.😕 'Edith' refers to a book she had read earlier, called "Land of the Burnt Thigh", which is the historical biography and memoirs of Edith Eudora Ammons Kohl, a pioneer woman who participated in, and became an expert in the land rushes and homestead movements in the late 1800s and early 1900s, the last major wave of pioneers of the West. She and her sister Ida Mary were half-orphaned when their mother died and her father remarried so they formed a strong bond to each other by their twenties. Since home life was unsteady and finances uncertain, they strove to become independent and explored the 'homesteading' lifestyle. They lucked into a 160-acre homestead claim in South Dakota which already had a house built on it and with the help of new neighbors, they learned how to make their lives prosper. Edith came into good fortune inheriting a newspaper which added to their finances and eventually she prospered teaching others how to do homesteads. She taught other single women how to homestead, as this became an excellent way for a woman alone to acquire a dowry, to marry. It seems to Bill that Mary might have better picked "IDA" instead of 'Edith', since it was Ida that shared her name, 'Mary'... LOL, but she picked Edith, so Edith it is. 

We will be staying in Texas (until 02/17 at Thousand Trails (TT) Colorado River in Columbus and 02/17 to 03/02 at TT Lake Conroe in Willis, and then head out to TT Three Flags in Wildwood (The Villages)  in Florida, where we'll be 03/07 through 03/21, and then to TT Orlando in Clermont 03/21 to 04/04. After that, we may stay in FL a bit longer before we start to head back north, stopping in Georgia (Blairsville and Blue Ridge) to visit some friends, Russell and Carey & Darci, respectively. Then, on s-l-o-w-l-y to Decatur, IN to the REV (Fleetwood) Factory Service Center to address the few issues we have identified, and to Shipshewana IN to have the four 300 watt solar panels that Bill took off of the Montana, re-installed on the new Discovery LXE 44B. Since Motor Home Specialist wasn't going to give us what we wanted for the Montana, after having installed all that extra equipment, we took it all off of the 5th wheel to reinstall what we can to the new RV (solar panels and 100A solar controller) and sell the remainder (a 3000 watt inverter, a Furrion 3-Camera System 7", a four-battery box, four almost-new batteries, a Rock Guard 2", two Maxxair 2 white vent covers, an Andersen Hitch complete with a brand new coupler and cable (MHS broke the attached one and replaced it) and the old Roadmaster Blackhawk 2 All Terrain tow bar, when we get back to Wyoming. In Shipshewana we'll undoubtedly go to E&S Bulk Sales and Yoder's Meat Market  for some cheese and meat stash to take back home. Mary now has a full size residential French-door refrigerator, and extra 2 cu ft freezer in the cargo compartment plus a 5 cu. ft. chest freezer in the bunk beds area, more than enough for all the extra foods she wants to get. IF Darren and Rozz or Jerry and Sue or Richard and Carolyn want to place an order for meat or cheese or both, let Mary know your pleasure.

Well, that does it for now. We just wanted to keep you all in the loop of our goings on and plans for the future. We're looking forward to seeing some of you real soon, and others later on, but if we don't see you this trip, just know that we always think of you and often mention you in conversation. Rest assured, it is always 'good'.