Sales Taxes, Property Taxes, Registration...

[EpicAdventure]

I hope everyone has their taxes done for tomorrow! Yuk!

Out boat search is starting to kick into high gear. One question that came to mind is taxes. We are looking for a used boat in the 50k price range. We are looking throughout the east coast, Florida, and Gulf Coast.

How does sales tax work in the different states? What about personal property taxes? I think there are some states that charge personal property taxes?

Basically, I'm trying to figure out 1) how much more than my offer I need to plan for and 2) if there are some states that I should favor and others I should avoid.

So far here are some costs I have in mind:

Survey: $12-17/ft
Haulout (for survey if it is in the water or to put in if it is in the hard -- I would think I would want to test sail just about anything before committing to buying it): ~$7/ft

Registration -- don't know what state I'll be buying so don't know how much to expect. We live in Minnesota but will be "cruising" elsewhere. Where does is make sense to register it? Any thoughts?

Sales taxes -- same as above. It looks like Florida, for example, has a sales tax of 6%. However, the boat is sold to someone out of state, that is exempt.

Personal property tax -- I know very little about this. I have just heard that some personal property in some states.

[sailingfool]

The taxes are pretty much all driven by where you are going to keep the boat, or by the first place that you will keep it, assuming that you move it fairly quickly after purchase, and you purchase it in a state other than the one that you reside in.

SO decide where you will keep it and research from there.

[EpicAdventure]

What about if our immediate plan is to cruise it?

Probably doesn't change things much....

[daydreamer92]

I'd register it where you plan to keep it, because generally speaking, that's the waters you will sail in most. What I ended up doing with my boat is registering it in NH (where I live) 'cause it's very easy and quick and then I have a legitimate form of owner identification to give to the Coast Guard for documentation purposes. If I weren't going to document it, I'd register the boat in Massachusetts instead because that's almost certainly where the boat will end up.

The town you keep it in probably will want to get their fee in the form of a permit of some kind.

If you are planning on cruising outside of the U.S. documenting the boat might be in your best bet instead.
If you document it, you don't have to register it.

[EpicAdventure]

Originally Posted by daydreamer92

If you are planning on cruising outside of the U.S. documenting the boat might be in your best bet instead.
If you document it, you don't have to register it.

What do you mean by "document it?" I don't think I'm familiar with that term?

The plan would be to sail the Caribbean -- Bahamas, leeward and windward islands.

[daydreamer92]

By documenting, I mean document the boat with the Coast Guard. For me, it's a one stop proof of ownership deal that means I don't have to get a yearly registration and apply for a title in MA; I also don't have to put numbers on the bow

Other advantages I've heard of are that banks like documented boats (easier time of financing) and an easier time of cruising international destinations. Actual cruisers can probably address that better than I. I'm sure there are other advantages too -- that's just a quick top of the head.

I'm sure there must be a topic or ten in these forums about documentation.

Here's a link to the Documentation FAQ on the Coast Guard site. Note that your boat has to be over a certain size to be documented and the owner must be a U.S. Citizen.

USCG National Vessel Documentation Center, FAQ Page

[hellosailor]

epic, if you do a little searching for older threads on state boat registration versus federal boat documentation, and the tax issues, you'll find them discussed in detail and at length.

Bottom line is that you WILL render unto Caeser, and you will leave a paper trail, and if you try too hard not to render...Caeser has no sense of humor. Sometimes it is just easier to pay up front, but do the research, sometimes you can be safe and still save a few dollars.

[EpicAdventure]

I searched through some other threads. It does look like it has been discussed quite a bit! I also found the cost guard FAQ pretty helpful.

Any other states like MA?

I'm still a little fuzzy as to whether state registration is required if I were to immediately cruise and not stay within any particular state more than 90 days (or 20 days or whatever...). If the vessel has it's CG documentation, would the be sufficient?

Like you say, it sounds like it might be easier to just pay the ~6% sales tax and register it in whatever state I buy it. On an ~$50k boat that isn't totally peanuts, but it sounds like a way to keep it simple.

[remetau]

No matter where you buy your boat, the state you register it in will want their money. If you buy the boat in one state and pay say 5% sales tax and then move your boat to another state and register it, if they have a 6% tax, then most of them will want the extra 1%. The same may be true if you register it in one state and then later register it in a different state.

One consideration in figuring out where to register your boat is how often do you have to get a new registration and how easy is it? You don’t want to register in NJ and live in FL and find out that you need to show an ID while registering, because then you’ll have a long expensive trip just to get a new sticker.

I have heard some states are a lot less than others and some make it really easy to get a new sticker.

We are cruising Florida and have our boat registered here. We bought our boat in Connecticut and had it transferred to Florida. When doing this, you only have so much time to register your boat and pay the sales tax. We were fined because we didn’t get our sales tax to Florida paid in time. The registration fees down here are based on boat size. We have a 33’ boat and I think last time I bought a 2 year sticker for about $250.

[sailingdog]

Lots of states will accept USCG documentation in place of state registration. If you plan on keeping the boat a long time, USCG documentation may make more sense. It is a one-time fee, versus annual. In Massachusetts, if you own the boat longer than 5 years, you're actually going to save money by documenting it.

Originally Posted by EpicAdventure

I searched through some other threads. It does look like it has been discussed quite a bit! I also found the cost guard FAQ pretty helpful.

Any other states like MA?

I'm still a little fuzzy as to whether state registration is required if I were to immediately cruise and not stay within any particular state more than 90 days (or 20 days or whatever...). If the vessel has it's CG documentation, would the be sufficient?

Like you say, it sounds like it might be easier to just pay the ~6% sales tax and register it in whatever state I buy it. On an ~$50k boat that isn't totally peanuts, but it sounds like a way to keep it simple.