Avoiding sales tax on purchase of used boat - SailNet Community
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post #1 of 69 Old 01-01-2011 Thread Starter
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Avoiding sales tax on purchase of used boat

It looks like I may be buying a used sailboat in Florida. We will be living aboard outside the US. Where would be the best place to register boat to avoid sales tax? We recall New Hampshire being a good choice? Is this still the case? Are there other alternatives?
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post #2 of 69 Old 01-01-2011
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Document it with the Coast Guard which is very inexpensive and then move it within the Florida tax period which I think might be 90 days.

Off-shore registrations tend to be $1000+.

While a US flag allows the US Coast Guard to board you anywhere in the world this is only a problem if you are doing something illegal. The big advantage is that it is easier to get them to go out of their way to help you if you are US.

Once out of the US you only have to pay each country's entry fees which are from nothing in the Grand Caymans to $200-300 in many Caribbean and Latin American countries.

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post #3 of 69 Old 01-01-2011
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You have to have an out of FL address and remove the boat from the state by the deadline (I forget if it's 30 or 90 days) or Florida WILL ding you for the sales tax.

You can get an extension of the deadline if the boat is in a yard and under repair.

Problem is, most other states also have a sales tax and if FL doesn't get you then they will. Where do you actually live, register to vote and/or get your mail? Where do you plan on registering the boat?
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post #4 of 69 Old 01-01-2011
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Be very careful. Avoiding taxes by choosing the best offer is perfectly acceptable. There are states that have no sales or use tax on boats that are kept within their boundaries. I'm sure that is done to promote the money that mariners will then spend in their state on income tax generating businesses. However, be sure you don't misrepresent where the boat is being kept for purposes of avoiding sales tax. That is tax evasion, which is a crime they love to enforce because they will get way more out of you than just the tax you once owed.
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post #5 of 69 Old 01-01-2011 Thread Starter
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Thanks for the feedback. Just to clarify things, I do plan to obtain USCG documentation, primarily because it makes entry into foreign ports easier ie, all countries recognize it. Since we will not be spending much time in any one State, it's really a matter of finding the most tax friendly State. I do want to be registered in a State because failure to do so creates problems when transiting from State to State (even with USCG documentation). I'm hoping someone in a similar situation can provide details of what's involved. I have seen references to RI and NH as having no sales tax. Is this true and are there any boaters out there who can verify same and perhaps explain the procedure? Thanks
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post #6 of 69 Old 01-01-2011
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Delaware is best for "DUMMY CORPORATIONS" - read tax evasion. Any state will follow you eventually if you stay long enough. I believe the "QUICK BOOKS FOR DUMMIES" series have a book on using your boat for business and how to's for tax elimination.

Remember who you are ultimately cheating, at the end of the day - the schools, closed libraries, the homeless and elderly, etc... not politicos.
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post #7 of 69 Old 01-01-2011
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Rhode Island does not have sales or use tax on boats. However, the state registration form requires you to identify your primary port of mooring. I doubt they allow the tax haven if you are not going to actually be there. Lie about that mooring location and you are back into tax evasion. Worse, you are going to be pursued by your state of residence, since your home address will be on the USCG reg form, unless you can demonstrate that the boat is elsewhere, such as with a slip/mooring rental, etc.
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post #8 of 69 Old 01-01-2011
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Perhaps the best option is to find out which states are most friendly to liveaboards staying in-state, rather than the state with the lowest you'd hvae to pay. This may work to your benefit in dealing with the beaureaucracy in the long run. That being said, if you have means to declare a legitimate home port in Rhode Island, it would be an effective avoidance of those extra fees tacked on.
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post #9 of 69 Old 01-01-2011
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From NH

We pay no sales[sails] tax here. We pay no excise or use tax on personal property as do many other states.
You may wish to look at BOAT YARDS-not marinas to call home here.
I would give you a few but not over net.
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post #10 of 69 Old 01-01-2011
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That is an excellent idea. If you can associate with a boat yard and they are willing, one may be able to declare such a place to be the legitimate port of call while overseas.
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