If this has not yet been posted, it is a good introductory article discussing the issues from a reputable source — a specialty car insurance company.
https://www.hagerty.com/media/market...ole-explained/
In my opinion, as someone who practiced law for 30 years, mostly in a state attorney general’s office, this is tax fraud. It is totally legal to have a Montana LLC and register your car under it if you use that car for the purposes of the LLC and confirm to all of your state’s laws. But where the Montana LLC is really a sham because it has no other business than registering your car and you don’t live in Montana or garage your car there, you are violating laws in many if not most states.
The cases will play out in court over time and it may be that in some states the statutory language was not written precisely enough to capture this method of evading taxes. I sued some some national corporations and lost in a tax case years ago. Lawyers can debate the meaning of the language and whether it covers the issue at hand, and a judge decides (typically in cases of statutory interpretation the question is a legal one not dependent on the credibility of witnesses so a jury is not necessary) the matter and one side wins and one loses.
Without looking at 49 state statutes and case law on in the matter, I can’t say which states will be problems for those using Montana LLCs to avoid taxes and even if I did give an opinion, it might be wrong. I won most of the hundreds of cases I filed but lost a big tax case. Some states won’t bother pursuing these case. Some will and will lose. I might be worried if I had my car under a Montana LLC, but it may be that most of the people doing this have plenty of money and are just greedy.