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post #1 of 11 Old 10-24-2006 Thread Starter
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boat taxes

We have been cruising in Mexico and Central America for the last 5 years and are now working our way up the East Coast. We hope to be in the Chesapeake Bay by next spring. We have heard that if you stay in the Bay over a year or so that Maryland will collect a 6% tax on the value of your boat. Is that true or are there other taxes like this that we should be concerned about? We plan to stay in the Bay at least a couple of years.

Thanks,

Joe and Jacque
s/v Marna Lynn
Alameda, CA
currently in Brunswick, GA
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post #2 of 11 Old 10-24-2006
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Check this site for info on Maryland and taxes. Assuming your boat is documented, you may have to pay a tax of up to 5 percent unless you can show you paid a similar tax in another state. This applies only if your boat spends more time in Maryland waters than another state.
http://www.dnr.state.md.us/boating/r...vessel_reg.asp

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post #3 of 11 Old 10-24-2006
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J and J... there is currently only a pittance ($25 bucks or so) personal property tax in Norfolk, Portsmouth and Hampton Roads. Anywhere else in MD or VA will take a chunk out of your cruising kitty. The taxes are generally assessed in January so you can cruise around the bay in the good weather as long as you do't sign any long term dockage contracts until you settle in for the fall in the Norfolk area.
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post #4 of 11 Old 10-24-2006
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jandj-
It sounds like Maryland applies a strict and simple 50% rule, i.e. if the boat is there more than 182 days a year, they own you. You might want to contact them in writing to find out if it is that simple, or if they provide for vessels in slow transit, etc.

Each state has their own regulations about boats and motor vehicles. Generally, you can expect a local "burden" sometime after you have had a motor vehicle in a state for 30 days. Sometimes that's tax, sometimes that's registration, but yes, it is that short in some states. State and federal rules about "domicile" versus "residence" may also come into play, you'll need to check that out too.

In many states the time period is tolled by moving in/out of their waters, it looks like Maryland doesn't let you cheat that way, they may just be counting days.
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post #5 of 11 Old 02-26-2007
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Maryland excise tax

The important thing to remember in Maryland is that the rule is not just 50% of the time must be outside of Maryland. You must have more time in another SINGLE state than you do in Maryland. So 4 months in Maryland and then 3 months in VA and 3 months in North Carolina and then 2 months in DC means Maryland will come after you for taxes. The other bogus Maryland deal is that Maryland wants you to pay the tax upfront before you have been in the state for 90 days if you plan to stay for more than 90 days even iof you plan to go elsewhere for more than 4 months in another state. Then there is currently NO FORMAL METHOD to request a refund of your excise tax even if you can prove you are entitled to get it back. This link to MD DNR. Just be careful they play dirty. When I was there a boater took them to court over the wording of their tax law saying the intent was not to tax people who were visiting with no intent to have MD their primary state of residence. The day after he won the legislature modified the tax law to close the loophole so it applies to anyone who boats in MD waters. BTW the Potomac is all in MD up to the Virginia shoreline.
http://www.dmarine.net/maryland.htm
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post #6 of 11 Old 07-09-2009
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Is that true or are there other taxes like this that we should be concerned about?


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post #7 of 11 Old 07-09-2009
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"The other bogus Maryland deal is that Maryland wants you to pay the tax upfront before you have been in the state for 90 days if you plan to stay "

That's not really bogus, not particularly a Maryland thing, and not even really a tax issue. That's a residency issue, and AFAIK anyplace you try to live, you will have similar problems with residency and domicile, both of which also subject you to taxes, jury duty, and general benefits and obligations of citizenship.

In some states you become a state citizen after residing there for 30 days. (Residing, not just living.) In some states you can declare your residence even if you are NOT living there, but have definite plans to return and settle down permanently. (Like Jacob sojourning in Egypt, but not residing there.)

Vagabonds and vagrants aren't expected to know these things, they're expected to keep on moving. Folks who plan to stay in one place for a month or longer--had better scout out the land. And the local definitions of all those nasty terms, like 'citizen' 'resident' 'domicile'....
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post #8 of 11 Old 07-09-2009
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Been there done that..got caught up between Fla's '90 day rule', where I bought our boat; Pa. where I reside and Md. where the boat resides..

Here goes..We purchased our boat in Fla. had 90 days to remove said vessel from the Fla waters..even had a letter from Fla stating I had to prove that the vessel had moved or pay Fla taxes..

Received a tax statement from Pa. stating I owed taxes on the purchase price to Pa because Fla had notified Pa that my residence is in Pa....

Received notice from Md. that I must pay (please note) a "User's Fee" because Pa. notified Md. that the boat resides in other than Pa..

Bottom line...You have to prove to every State that taxes where paid/users fees or the boat is not in their jurisdictional waters.... In Md. the Natural Resource Police go from marina to marina looking for said 'Sticker'...I've watched from my vantage point at Kent Narrows( a very busy transiting area) have seen people being stopped for that missing or improper display of registration numbers to include documented vessels that have been observed to long in the area with foreign hailing ports...

Good luck,

Clay AA3JY
s/v 'Tango'
Piney Narrows Yacht Haven
Chester,Md.
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post #9 of 11 Old 07-09-2009
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As I understand it, Maryland collects a one time tax of 6%. In Virginia, you pay personal property tax every year. Each county assesses the tax so the amount you pay can vary greatly based on what county you are in. According to what I could find on the web when researching this for myself, Middlesex Country has the lowest tax assement on boats.

So if Cam is right (and he most often is) then the info I found was flawed. Unfortunately, that info won't help me because there is no way I'm moving my boat further from me than it already is.

Anyway, I would suggest calling the commissioner of revenue of Middlesex county and whatever counties Norfolk, Portsmith and Hampton are in and find out how they acess their tax. I think you'll find it would be cheaper to pay two years PP tax in VA than a flat 6% in MD. I could be wrong though and the only way to be sure is to call, get the facts from the horses mouth and then do the math.

I can tell you that the amount you would save on slips in Middlesex County (Deltaville, VA)vs. points either north or south on the Chesapeake will likely far offset any tax conseqence.

PalmettoSailor
s/v Palmetto Moon
1991 Catalina 36

Last edited by PalmettoSailor; 07-09-2009 at 05:00 PM.
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post #10 of 11 Old 07-09-2009
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Maryland hits you all at once with a sales tax. VA get's you annually. MD has guys in runabouts slipping in and out of marinas looking for out of state registrations. They take note of the date and return later to see if you're still there. If you are you'll be contacted. If you plan on crusing the bay and not stay on any one place for an extended period of time it's doubtful they'll ever find you. I'd also check MD tax laws as I believe there's a statute of limitations on how far back they can go to charge you sales tax.
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