Under RR 97-5, how much South Carolina sales tax did a nonresident owe when buying a travel trailer?

Plain-English summary

South Carolina Revenue Ruling 97-5 said a dealer selling a travel trailer to a nonresident generally charged the lesser of two amounts: the tax that the buyer's home state would impose or the South Carolina tax that a resident would pay.

Under the ruling's then-current law, the South Carolina comparison amount was the lesser of five percent of the trailer's sales price after any trade-in allowance or $300. If the buyer's home state did not tax travel-trailer sales, South Carolina tax was zero. The same was true if the home state would not give the buyer credit for sales tax paid to South Carolina.

The special nonresident treatment depended on documentation. At the sale, the dealer had to obtain and retain a notarized Form ST-385 stating that the purchaser intended to license the trailer in the home state within ten days. The purchaser also provided a copy to the home-state sales-tax agency.

Conditions in the ruling

• The buyer was a resident of another state.
• The travel trailer was a type required to be registered and licensed.
• The dealer obtained the notarized statement at the time of sale and kept it for Department review.
• The buyer intended to license the trailer in the home state within ten days.
• South Carolina tax could not exceed either the destination-state tax or the stated South Carolina maximum.
• No South Carolina tax applied if the home state would not credit tax paid here.

Common questions

Q: Did every nonresident trailer sale automatically get the special calculation? No. The dealer had to obtain and retain the required notarized form and meet the statute's other conditions.

Q: Did a trade-in reduce the South Carolina comparison amount? Yes under the ruling; the five-percent calculation used the price less the trade-in allowance.

Q: What if the buyer's state imposed no tax? The ruling said the South Carolina dealer should not charge South Carolina tax.

Q: Are the $300 cap and Form ST-385 current? This page does not establish that. Both reflect the ruling's 1997 law and procedure and must be checked against current requirements.

Citations and references

• S.C. Code Ann. § 12-36-930 (sales of registerable vehicles and trailers to nonresidents)
• S.C. Code Ann. § 12-36-2110(A)(6) (then-applicable recreational-vehicle maximum tax)
• S.C. Code Ann. § 56-3-720 (travel-trailer registration and licensing cited)

Subject

Sales of Travel Trailers to Nonresidents

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/RR97-5.pdf

Original ruling text

State of South Carolina

Department of Revenue
301 Gervais Street, P. O. Box 125, Columbia, South Carolina 29214

SC REVENUE RULING # 97-5

SUBJECT:

Sales of Travel Trailers to Nonresidents
(Sales and Use)

EFFECTIVE DATE:

Applies to all periods open under the statute.

SUPERSEDES:

All previous documents and any oral directives in conflict herewith.

REFERENCES:

S. C. Code Ann. Section 12-36-930 (Supp. 1996)
S. C. Code Ann. Section 12-36-2110(A)(6) (Supp. 1996)

AUTHORITY:

S. C. Code Ann. Section 12-4-320 (Supp. 1995)
SC Revenue Procedure #94-1

SCOPE:

A Revenue Ruling is the Department of Revenue's official advisory
opinion of how laws administered by the Department are to be applied to
a specific issue or a specific set of facts, and is provided as guidance for
all persons or a particular group. It is valid and remains in effect until
superseded or modified by a change in the statute or regulations or a
subsequent court decision, Revenue Ruling or Revenue Procedure.

Question:
What amount of sales tax is be imposed on sales of travel trailers to nonresidents?
Conclusion:
If the seller obtains a Form ST-385 from the purchaser and meets the other requirements of Code
Section 12-36-930(B), the amount of sales tax due is the lesser of the amount of tax which would
have been due had the customer purchased the travel trailer in the customer’s state of residence
or the amount of tax a resident would pay under Chapter 36 of Title 12. The amount of tax a
resident would pay under Chapter 36 of Title 12 is the lesser of 5% of the sales price of the travel
trailer, less any trade-in allowance, or $300.
Discussion:
South Carolina Code Section 12-36-930 reads:
(A) The tax imposed by this article [sales tax] on sales of....trailers....of a type to be
registered and licensed, to a resident of another state, is the lesser of:
(1) an amount equal to the sales tax, which would be imposed in the purchasers
state of residence, or
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(2) the tax that would be imposed under this chapter.
(B) At the time of the sale, the seller shall:
(1) obtain from the purchaser a notarized statement of the purchasers intent to
license the vehicle, within ten days, in the purchasers state of residence [Form
ST-385]; and
(2) retain a signed copy of the notarized statement. The purchaser shall give a
copy to the sales tax agency of the purchasers state of residence.
(C) No tax is due if a nonresident will not receive credit in his state of residence
for sales tax paid to this State under this section. (Emphasis added.)
As for “the tax that would be imposed under this chapter [Chapter 36]”, Code Section 12-362110 reads, in part:
(A) The maximum tax imposed by this chapter is three hundred dollars for each
sale....or lease....of each:

(6) recreational vehicle, including tent campers, travel trailer, park model, park
trailer, motor home, and fifth wheel; or (Emphasis added.)
It must be determined whether the term “trailer” in Section 12-36-930 includes travel trailers.
The term “trailer,” as used in Section 12-36-930, applies to all trailers that are of a type to be
registered and licensed in South Carolina. Per South Carolina Code Section 56-3-720, travel
trailers must be registered and licensed in South Carolina. Therefore, Section 12-36-930 is
applicable to sales of travel trailers. The amount of tax to be charged is the lesser of the amount
of tax that would have been due in the customer’s state of residence or the amount of tax a
resident would pay under Chapter 36 of Title 12. The amount of tax a resident would pay under
Chapter 36 of Title 12 is the lesser of 5% of the sales price of the travel trailer, less any trade-in
allowance, or $300. If the customer’s state of residence does not tax sales of travel trailers, then
the dealer in South Carolina is not to charge this state’s tax. The same is true if the nonresident’s
state does not allow a credit for the sales tax paid in South Carolina - this state’s tax is not to be
imposed.
NOTE - To come within the provisions of Section 12-36-930, the dealer must obtain a Form ST385 from the purchaser and have it available for examination by the Department of Revenue.
SOUTH CAROLINA DEPARTMENT OF REVENUE
s/Burnet R. Maybank III
Burnet R. Maybank III, Director
Columbia, South Carolina
, 1997
April 28
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