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Texas Court Sides with RV Owners on Tax Issue

December 14, 2009 by · Leave a Comment 

The question of whether or not recreational vehicles are taxable has just become more complicated in Texas.

For certain, though, litigation on the question will continue, according The Brownsville Herald.

Attorneys are assessing the implications of a recent opinion from the 13th Court of Appeals partially reversing the state’s 357th District Court.

The appellate court opinion exempts travel trailers built on or after June 15, 1976, from property taxation – but only for the 2001 tax year.

The appellate court was bound by the state court’s ruling that it had jurisdiction for tax year 2001 only.

“On appeal (from the state court ruling), neither party disputes this conclusion,” the appellate court pointed out in its Nov. 24 opinion.

The appellate court opinion comes after more than nine years of litigation initiated by a group of RV owners in a civil lawsuit titled Thora O. Rourk et al vs. the Cameron Appraisal District (CAD), which sets values on real and personal property for purposes of taxation.

The group maintained that its members’ trailers were nontaxable recreational vehicles rather than taxable manufactured or mobile homes due to their size, shape and intended use as temporary living quarters for recreational, camping, travel or seasonal use.

The appellate court opinion noted that the trailers of those members of the group that could not prove that their trailers were manufactured on or after June 15, 1976, are taxable. This is the date when federal standards regarding the construction and definition of manufactured homes went into effect.

Rourk was glad to hear that her group of travel trailer owners prevailed in the appellate court opinion.

“You’re kidding!” Rourk said in a telephone interview from Illinois.

“I just sold the (travel) trailer,” she said, noting, however, that, “We’ve been fighting for years.”

The group’s attorney, Ruben R. Peña, said, “I feel that the opinion vindicates our position.”

But it’s a shaky position at best.

Peña said that the ruling only applies to the 2001 tax year and that even the prevailing parties would have to go through the appraisal protest process and perhaps even litigation year after year – if CAD doesn’t honor the spirit of the appellate court opinion.

CAD isn’t saying.

The limited statement issued by CAD attorneys noted that the appraisal district plans to file a motion for a rehearing before the appellate court, asking that it reconsider the portion of the opinion exempting some travel trailers from taxation.

“We do not believe the court correctly analyzed the tax code definition of improvement. We believe it is important (that) this issue be correctly analyzed by the Texas courts,” CAD attorney Judy Hargrove said.

The issue could reach the Texas Supreme Court.

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