Skip to main content

Park Models and Ad Valorem Tax

park-models-and-ad-valorem-tax

Park Model RV?

Tiny Homes go by many names:

Park Model RVs (PMRV), Park Model Tiny Homes, Park Model Trailers, Travel Trailers, recreational vehicles, recreational park trailers, house trailers, Park Home RV, or Tiny Homes. It’s important to understand the differences in terms of law, construction and for titling and tax purposes.

There is no national standard, laws, rules, etc. for a Park Model RV, but organizations like RVIA and NOAH are working on that. However, their primary role is to insure manufacturers build in accordance with ANSI 119.5 for PMRVs.

The Texas Comptroller’s Tax Guide considers “Travel Trailer or Recreational Trailer” as motor vehicles. The Department of Motor Vehicles collects sales tax on “travel trailer“ and “park model trailer” as unregistered vehicles.

There is no mention of the term “park model RV” in Texas Constitution, Texas Tax Code, Texas Comptroller Tax Guide or Texas Department of Motor Vehicles, however, we were taxed on the purchase of a “travel trailer” by the Department of Motor Vehicles, and received our title from them.

Both “travel trailer” and “park model trailer” are:

“Not designed or used primarily as a permanent dwelling, but as temporary living quarters for recreational, camping, travel, or seasonal use; and are built on a single chassis.”

However, by Texas DMV definitions, a park model trailer differs from a travel trailer in that, it can be:

“greater than 8.5’ wide, and it can be longer than 45’ but must be 400 square feet or less when “measured at it’s horizontal extremities.”

While the travel trailer:

“Must be less than eight (8) feet, six (6) inches in width or less than forty-five (45) feet in length (not including the hitch [ed. no mention of square footage]).”

The DMV collected sales tax and provided a motor vehicle title for our designated “travel trailer”. Notated on our receipt was this:

TRAILER TYPE: TVL TRLR
L/W/SQFT: 35' 2"/11' /399

However, by their own definition provided on the application form entitled “Trailer Verification Statement of Fact” it is not a Park Model trailer by our (actual) single chassis dimensions, which are 15’ x 51’, and also not a park model or a travel trailer since we intend for it to be “used as a permanent dwelling.”

Not on the Trailer Verification Statement of Fact, but according to the Texas Comptroller’s Tax Guide:

A travel Trailer
“contains plumbing, heating, and electrical systems that may be operated without connection to outside utilities”

The Texas Constitution, Texas Tax Code, Texas Comptroller, Texas Department of Motor Vehicles and the Burnet Central Appraisal District (Tax Accessor Collectors) all acknowledge an exemption from ad valorem tax for “Travel Trailers.”

The Texas Tax Code Section 11.14 provides for exemption from personal taxes for a structure that has a gross trailer area in the set-up mode of 400 square feet or less. However, a “travel trailer” or “park model trailer” can be taxed as tangible or real personal property by the governing tax authority.

Leah, from the Burnet County Tax Accessor Collectors office says that

“they will tax the entire unit if the gross trailer area exceeds 400 square feet, but that you can file a homestead exemption and your taxes won’t be very much.”

Platinum Cottages, and other “Park Model” Homes, prominently display certification stickers from NOAH and RVIA.

Scroll to Continue

These organizations are helping to set the standards for tiny homes, particularly Park Model Recreational Vehicles (PMRVs). One of the goals of RVIA is to ensure that your PMRV complies with ANSI 119.5. Another, perhaps equally important goal is to make sure state, city and county laws, statutes, regulations, etc. recognize park model RVs the same as any other recreational vehicle, particularly for the property tax advantage.

Curt Richardson at RVIA tells me, they helped convince HUD to agree to not consider square footage of decks unless enclosed as for a living space and lofts no greater than 5 foot high.

Some of my neighbors tell me they were only taxed for their decks and that I should expect the same. This seems to be a, sort of, “standard“ around the country. It’s not. It is a misconception.

Here’s what I mean: our park model RV (PMRV) has a living area of 400 square feet and a loft 51 inches tall at it’s tallest point. We have a 10 foot deck in the front, a 6 foot deck in the back, and a 4 foot deck from front to back totaling 365 square feet. So will I be taxed for 365 square feet? Nope. Leah, the Burnet County Tax Accessor says,

“If your gross trailer area was 400 or less, there would be no taxes. However, since it’s more than 400 you’ll be taxed for the full 765 square feet.”

Leah, also mentioned that I should receive notification of taxes soon and should complete a Homestead Exemption form.
COMPTROLLER TEXAS.GOV
https://comptroller.texas.gov/taxes/property-tax/exemptions/residence-faq.php

Then there’s this definition for PMRV or “recreational park trailer” from RVIA’s website and many RV and legal websites:

“PMRVs are built on a single chassis, mounted on wheels and have a gross trailer area not exceeding 400 square feet in the set -up mode.”

Looking at my gross trailer area, I note the entire chassis extends from the front to the back and from side to side increasing gross trailer area to 765 sq ft!

Mr. Richardsons, Director of Inspection Services, RVIA, (crichardson@rvia.org) tells me that ANSI 119.5 has provided for this additional support in order to insure the home (and fellow commuters) are safe during transport. So how do they compute square footage? He sends me this:

park-models-and-ad-valorem-tax
park-models-and-ad-valorem-tax
park-models-and-ad-valorem-tax

There was no attachment but I found: HUD A‐1‐88 Manufactured Home Procedural and Enforcement Regulations; Clarifying the Exemption for Manufacture of Recreational Vehicles

Summary:
“This rulemaking revises the exemption for the manufacture of recreational vehicles to clarify which recreational vehicles qualify for an exemption from HUD's Manufactured Home Construction and Safety Standards and Manufactured Home Procedural and Enforcement regulations.”

https://www.federalregister.gov/documents/2018/11/16/2018-24950/manufactured-home-procedural-and-enforcement-regulations-clarifying-the-exemption-for-manufacture-of

To be clear, the exemption is for recreational trailers to be excluded from HUD regulations as pertaining to construction of manufactured housing. The ruling above (HUD A-1-88) is to include ANSI 119.5 construction code for Park Model RVs and has nothing to do with titling, taxes, or how the RV is used.

“HUD emphasizes that this rule does not affect the use of RVs by consumers. Rather, this final rule clarifies the exemption for RVs from HUD manufactured housing regulation.”

AND

“HUD is not regulating use of manufactured homes or RVs. More specifically, how individuals decide to use their manufactured home or RV unit after purchase-and, in some cases, after receiving a Manufacturer's Notice about the unit's compliance with RV standards-is beyond the scope of this final rule. The regulation of use and occupancy of RVs is the purview of state and local authorities, not HUD.”


COMPTROLLER TEXAS MOTOR VEHICLE TAX GUIDE

Trailers and semi-trailers are motor vehicles and are subject to motor vehicle tax, unless specifically exempt.

Trailer Types

Types of trailers include house trailers, such as travel trailers and park models

Related to “travel trailer” I can find no glossary of terms for the Texas Constitution, Texas Tax Code but there is one for Texas Comptrollers:

MOTOR VEHICLE TAX GUIDE

Glossary of Terms

Travel Trailer or Recreational Trailer

A trailer designed for human habitation as temporary living quarters in connection with recreational, camping, travel, or seasonal use that is not designed to be used as a permanent dwelling; is less than eight feet six inches in width and 45 feet in length in the traveling mode and contains plumbing, heating, and electrical systems that may be operated without connection to outside utilities; and is not a utility trailer, enclosed trailer, or other trailer that is not designed for human habitation as its primary function.

Park Model

A trailer designed to be used for human habitation, with or without a permanent foundation, when connected to the required utilities, and is less than eight feet six inches in width and 45 feet in length in the traveling mode; includes the plumbing, heating, air conditioning and electrical systems; and is not required to be affixed with a label or decal issued by the U.S. Department of Housing and Urban Development and by the Texas Department of Housing and Community Affairs.”

What is property tax?

“Property tax” is a municipal tax levied by counties, cities, or special tax districts on most types of real estate - including land, homes, businesses, modular homes, tiny homes, but not Recreational Vehicles.

In 2001 the Texas Constitution was amended : H.J.R. No. 44

“A JOINT RESOLUTION proposing a constitutional amendment authorizing the legislature to authorize taxing units other than school districts to exempt certain travel trailers from ad valorem taxation.

“Passed by the House on May 9, 2001, by the following vote: Yeas 135, Nays 7, 2 present, not voting; passed by the Senate on May 22, 2001, by the following vote: Yeas 26, Nays 4, 1 present, not voting.”

The only thing written into Texas State tax code is related to trailers that comply with A119.5. It says Trailer-type structures are exempt from personal property tax. But nothing is said about “Park Model RVs.”

However, counties, cities, and special tax districts have their own autonomy. It’s anyone’s guess how Park Model RVs, Park Model Tiny Homes, Park Model Trailers, Travel Trailers, recreational vehicles , recreational park trailers, house trailers, Park Home RV, or Tiny Homes will be approached in the future here in Liberty Hill or Burnet County. For now, rest assured, some taxes will be forthcoming.

The Department of Motor Vehicles

…collects sales taxes on “Travel Trailers” and “Park Model Trailers.”

We paid taxes to the Texas Department of Motor Vehicles (6800 dollars) for purchase of our PMRV and it was listed on the Title Application Receipt and the Texas Certificate of Title as a “travel Trailer.”

The DMV collects sales tax on Travel Trailers, but not registration fees and does not license them.

park-models-and-ad-valorem-tax
park-models-and-ad-valorem-tax

Can our “travel trailer” be taxed as tangible or real personal property? Yes, as covered here:

Texas Tax Code

Sec. 11.14

Tangible Personal Property Not Producing Income

(a) A person is entitled to an exemption from taxation of all tangible personal property, other than manufactured homes, that the person owns and that is not held or used for production of income. This subsection does not exempt from taxation a structure that a person owns which is substantially affixed to real estate and is used or occupied as a residential dwelling.

(b) In this section:

(1) “Manufactured home” has the meaning assigned by Section 11.432 (Homestead Exemption for Manufactured Home).

(2) Structure does not include a vehicle that:
(A) is a trailer-type unit designed primarily for use as temporary living quarters in connection with recreational, camping, travel, or seasonal use;

(B) is built on a single chassis mounted on wheels;

(C) has a gross trailer area in the set-up mode of 400 square feet or less; and

(D) is certified by the manufacturer as complying with American National Standards Institute Standard A119.5.

(c) The governing body of a taxing unit, by resolution or order, depending upon the method prescribed by law for official action by that governing body, may provide for taxation of tangible personal property exempted under Subsection (a). If a taxing unit provides for taxation of tangible personal property as provided by this subsection, the exemption prescribed by Subsection (a) does not apply to that unit.

(d) The central appraisal district for the county shall determine the cost of appraising tangible personal property required by a taxing unit under the provisions of Subsection (c) and shall assess those costs to the taxing unit or taxing units which provide for the taxation of tangible personal property.

(e) A political subdivision choosing to tax property otherwise made exempt by this section, pursuant to Article VIII, Section 1(e), of the Texas Constitution, may not do so until the governing body of the political subdivision has held a public hearing on the matter, after having given notice of the hearing at the times and in the manner required by this subsection, and has found that the action will be in the public interest of all the residents of that political subdivision. At the hearing, all interested persons are entitled to speak and present evidence for or against taxing the property. Not later than the 30th day prior to the date of a hearing held under this subsection, notice of the hearing must be:

(1) published in a newspaper having general circulation in the political subdivision and in a section of the newspaper other than the advertisement section;

(2) not less than one-half of one page in size; and

(3) republished on not less than three separate days during the period beginning with the 10th day prior to the hearing and ending with the actual date of the hearing.

park-models-and-ad-valorem-tax

Related Articles