As others have indicated, vehicular laws vary from state to state and as such, laws about license plate display will too.
However, there is a lot of uniformity between states' vehicular laws. You can most likely count on a couple things regarding the display of your license plates:
- There is most likely a state statute dictating that your license plate must be clearly visible. How exactly they define that will vary from state to state.
- There is also most likely a statute dictating where your license plate must be placed. I.e., not more or less than a certain distance from the ground. And although I'm not aware of a state that does this, it's not unthinkable that there would be something requiring that the license plate be horizontally centered on the rear of your vehicle.
For example, I live in Missouri and our laws say:
301.140. Each such plate shall be securely fastened to the motor vehicle or trailer in a manner so that all parts thereof shall be plainly visible and reasonably clean so that the reflective qualities thereof are not impaired. Each such plate may be encased in a transparent cover so long as the plate is plainly visible and its reflective qualities are not impaired. License plates shall be fastened to all motor vehicles except trucks, tractors, truck tractors or truck-tractors licensed in excess of twelve thousand pounds on the front and rear of such vehicles not less than eight nor more than forty-eight inches above the ground, with the letters and numbers thereon right side up.
Again, the exact wording of your laws will be different. You should really look them up.
You should also note that it is not just tow hitch racks that can obscure a license plate. Many trunk racks will also obscure the plate if it is placed on the trunk and not the bumper.