Corporate ownership?

[dtempleton]

Hi;

I'm nearing the purchase of a 39' Freedom, that I can afford to buy with cash (the loan rates are outlandish, compared even with second mortgages). When I called to get an insurance quote, I was surprised at the question "Will this be owned by an individual or a corporation?"

But after thinking about it, there may be some advantages to holding the boat as a closely-held corporation:

1) reduced liability exposure
2) sharing expenses with buddies while leasing from the corporation
3) perhaps simpler leasing/fractional ownership relationships

Any I have missed?

I would be interested in hearing the collective wisdom about this option, and how others may have used it.

Thanks

D

[night0wl]

reduced taxes if you register as an overseas corporation and foreign flag the vessel. trouble is, fees for setup usually exceed the cost of most smaller boat purchases ($5-7k)

[sailingdog]

There are also on-going costs to registering and holding a boat under a corporation to consider. Unless you're seriously considering partners or partial ownership, forming a corporation is probably more trouble than it is worth. Be careful about "sharing expenses" as that may or may not be seen as chartering the boat, and if it is, the costs on your insurance will go way up, since you'll be required to have COMMERCIAL insurance on the boat.

[kd3pc]

Be careful of "corp" ownership...one from the IRS point of view...is it a business or a hobby...Audit...

Someone in the Corp may actually have to be a USCG Captain and your insurance will definitely be of higher costs..

be forewarned...

dave