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Old 01-18-2010
ToddLochner ToddLochner is offline
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MD and PA vessel tax

Typically, MD and PA have a reciprocal relationship. The reality is that reciprocity is done on a "state by state basis" and although the answer rarely "officially" changes the practical ease of taking the exemption can vary based upon the relationship between the vessel tax enforcement administrators. I have heard of one state bureaucrat giving a different state's bureaucrat a hard time over reciprocity and an individual taxpayer has been caught in the middle. Remember that it is all about money and which state keeps the tax dollar. Budgets are tight all over. There is an organization which tries to smooth over some of these common issues and you may find their site useful. It is the National Association of State Boating Law Administrators.

As for PA and MD in particular, they have always had a good relationship. This can be a real blessing on one hand but on the other it is a huge problem for the vessel owner. When the vessel tax officials are "too chummy" they have one another on speed dial. If you escape tax in one state they call their compatriot who often goes for penalty and interest.

You should also consider whether your vessel may be a good candidate for offshore flagging. It is not as expensive as people think. Depending upon a number of circumstances, the break point for cost savings is usually with a purchase price in the $150,000 to $200,000 range. There is info available on a site that I am not allowed to post due to forum rules.

Since you have two threads I will post the answer in both.

Todd Lochner
Proctor in Admiralty
Lochner Law Firm, P.C.
30 C West Street Phone: (443) 716-4400
Annapolis, Maryland 21401 Fax: (443) 716-4405
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