Hello,We're US citizens and planning to purchase a vacation

Italian law says that you cannot buy a car if you are not resident in Italy. 

info about obtaining residence in italy , here >  https://www.italianmortgageservice.com/Inglese/italyresidenceguide.htm

US driving licence:-

https://it.usembassy.gov/u-s-citizen-services/local-resources-of-u-s-citizens/transportation-driving/

Buying a car?  I have heard that some get an Italian to buy a car and insure it, then use it themselves.. (obviously you pay for all costs)

US driving licence:-

https://it.usembassy.gov/u-s-citizen-services/local-resources-of-u-s-citizens/transportation-driving/

Buying a car?  I have heard that some get an Italian to buy a car and insure it, then use it themselves.. (obviously you pay for all costs)

Yes Alan .. but

when the traffic police stop the car, for a check, if the driver is unable to prove, why he drives a car that is not his - The diligent agents seize the car and entrust it to the court that sells it at auction - and the driver cannot be opposed - To avoid this problem, the name, date of birth and residence of the usual driver must be noted on the vehicle registration certificate, under penalty of a fine of a minimum of 516.46 euros per a maximum of 2,582.28 euros in addition to the withdrawal of the registration certificate. - obviously if the driver is not a resident, the annotation will not be accepted by the offices in charge

> https://www.laleggepertutti.it/273542_guidare-auto-non-intestata

I know that  anyone who lives (has a residence permit) in Italy for more than 60 days is prohibited from driving a vehicle registered abroad

I would advise you to look into a lease program such as that offered by Peugeot. There are likely other such programs available for Italy but that is the one I am somewhat familiar with. The cost is quite reasonable, they also provide full insurance coverage (including emergency road service) and they handle the maintenance as well. No worries about storing the vehicle while you are away (at a minimum you must remove the wheels so that the tires don't get flattened out of their round shape, and you may need to drain the gas tank as well!) or putting it back in condition to drive when you return.

As Ugo has advised, it is not a good idea to try shortcuts in order to own a car in Italy. In particular you should be wary of well-meaning shortcut 'advice' offered on Facebook such as purchasing and licensing the car in another country then driving it in Italy while maintaining a vacation home there. The police are wise to this. A number of Brits got their cars towed away a few short years ago when the police cracked down on people exploiting this shortcut.

As mentioned in a previous post, there are several long-term lease programs available to non-EU citizens. Peugeot and Renault offer a new car, fully insured, with pick-up and delivery sites in a number of European cities, including Italy. If you pick up and return in a French city the cost is reduced by some €400. There is also an advantage to driving a French licensed vehicle in Italy. Check them out for leasing up to six months.