A new law, passed this year by the Indiana General Assembly, exempts purchases of RVs by nonresidents from Indiana sales tax, if the purchaser’s home state where they intend to register the RV offers similar treatment to Indiana purchasers.
Currently there are eight non-reciprocal states (AZ, CA, FL, HI, MA, MI, NC, and SC) where the RV sale would not be exempt and a special tax rate applies. If the purchaser intends to register the vehicle in one of those sates, Indiana RV dealers must collect the tax at the rate of the state where the RV will be titled and registered, collecting only the state tax and not any local sales taxes. After July 1 of this year, that tax rate is now equivalent to the non-reciprocal state’s sales or use tax rate.
As shown in the attached notice from the Indiana Department of Revenue, the dealer should also issue to the nonresident purchaser a form ST-108NR as proof of the sales tax paid. All sales taxes collected will continue to be remitted to the Indiana Department of Revenue.
For any additional information regarding sales tax on RVs or cargo trailers, industry members should contact the Indiana Department of Revenue Tax Policy division at (317) 233-4197.
