California targeted tax avoidance through Montana shell-company vehicle registrations with SB 1406, signed on September 30. The law addresses registering expensive vehicles, boats or aircraft in an out-of-state company’s name to avoid California taxes. A company is treated as a state resident when conditions such as having an owner residing in California and lacking substantive business activity are met. Liability for unpaid taxes, interest and penalties was also strengthened. The state says the law takes effect immediately, but it is not a blanket prohibition on registrations by all companies legitimately doing business in other states.