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A cheaper place to Register a Sailboat.

4K views 39 replies 16 participants last post by  swampcreek 
#1 ·
Hi All I am trying to find a cheaper place to register a boat. Here in Florida it is 7% sales tax on a boat and I have heard that You can do it in Delaware for less money. Any info would be helpful. Thanks.:D
 
#2 ·
You must pay the tax of the state the boat resides in.

Unless you don't plan on being in any state longer that 5 months, you could register in a lower taxed state, but with todays economy I'm seeing enforcement of tax collection stepped up big time. IE: the tax officials in MD (DNR) are photo documenting our marina every month, and have told me they will be sending violations/bills to all boats who are not displaying current stickers.
 
#4 ·
Registering in a different state to avoid sales tax is a really bad idea, and illegal besides.
 
#5 ·
As a point of clarification (and correct me if I'm wrong), it would only be illegal if you register it in Delaware and keep it in Florida. If you register it in Delaware, keep it in Delaware, but live in Florida, that's fine. But it's massively impractical in this situation.

Tax avoidance (which is perfectly legal; contrast with tax evasion, which is illegal) is not free. There is a cost associated with lowering your tax bill, and very often it's cheaper to simply whine and ***** about it and just pay the tax anyway.
 
#6 ·
I suggest you write John Kerry at his US Senate addy. I hear he's pretty good with stuff like this. :)
 
#9 ·
CP, if he keeps his "yacht" docked in RI he's responsible for RI taxes, not MA where he lives. I live in VA but keep my boat in MD, and I had to pay the 5% MD tax as opposed to the 4% VA tax...
 
#8 ·
Taxes

I have worked for the tax collector for a long time and I used to watch them agonize over how they could collect more taxes. And watching the people that receive the tax money and piss it way was also an education. In an average county in Florida the tax collector will bring in 400 million in taxes a year. and the schools get half of that . How they can squander it so easily I'll never know.:D
 
#12 ·
USCG documented or not, you are required to pay the user tax in the state the boat resides in.

Only if you buy a boat and stay out of the US then you can get away without paying any state user tax. But once you return and stay for more than 3-6 months in one state, you owe.

FWIK, it works the same in foreign countries as well, so you can't moor your boat in the Bahamas and not expect to pay a tax to Bermuda.

It's a given, when you buy a boat that you need to add the tax owed to the purchase price.
 
#13 ·
documented boats

as far as documented boats go, every state has their way to trying to track the boat.
If the mailing address for the boat is in that state and its sold, most states will go after the seller and/or the buyer who registers a boat in that state
Some states like Maryland and California walk the marina and find you that way. Others do not. I know of people who document and have the mailing address in a no-tax state, and keep the boat in a high tax state which I will not mention and never get a bill.

In California they will drive around and look into people's yards.
This goes for sales and use tax as well as excise taxes or personal property taxes.
In Newport Beach, one owner brings his megayacht up from Ensenada one month a year. Got hit with a $200,000 property tax bill times X years. he won on appeal.
 
#14 ·
First, registration and sales/use taxes are two completely different things.

Generally, most states require you to register your boat in their state, pay an annual fee and display a sticker or hull registration numbers, if you keep it there for an extended period. I've seen as short as 90 days up to 6 months. Even if you are USCG documented, you typically register in the state where you keep the boat, although, hull registration numbers become unnecessary. You may here of documented vessel owner'swho claim they never register. Be careful, since they aren't required to display hull reg numbers, its just harder to get caught.

Sales tax is owed on defined purchases in the State where you purchase the boat. Most states exempt sales taxes to residents of other states if: they are immediately removing the item from the state of purchase and agree to pay their home state's "Use Tax". The Use Tax is usually the equivalent rate as Sales Tax. It was designed to essentially collect sales taxes, if you avoided them by purchasing out of state and immediately transporting the item home to "use" it. The qualifying and disqualifying time frames between purchase and then use in another state, along with how long you must use it within the state to become obligated, vary greatly between states.

John Kerry apparently claimed to be using his boat in RI, where there is no sales or use taxes on boats. There is nothing illegal about buying a boat outside RI, immediately removing the boat from where you bought it and being exempt from sales tax there, then bringing it to RI to "use" it, where there are no use taxes.

I'm not fully informed of his details, but I suspect one of three problems. First, he lives next door in Mass. If he tied the boat to a slip in RI, but sails it home every weekend (and Martha's Vineyard is Mass), his home state maybe arguing he really does use it there. Second, several states have insidious agreements between them that require there residents to make up the difference in sales/use tax rates to each other in these conflicts. I do not know if RI/MA have such. Third, it just became a rich man's tax shelter on his yacht, screw the little guy, political problem, not a legit tax problem. He could defend himself, keep attention on his extravagant lifestyle and potentially cause the tax laws to change, or just pay and make it go away.

BTW, the tax review is worth what you paid for it. YMMV and you must research all the specifics of the state's involved.
 
#15 ·
Tax "avoidance" vs "evasion" is a pretty fine distinction. It is like talking about the difference between a "fib" and "lie". Sure, there is a difference in connotation there but at the end of the day it is all untruth.

I have no problem with people who choose not to be a part of society, but it really bugs me when they rationalize their choices to the extent that they start pretending that is not precisely what they have done.
 
#17 ·
Not quite. It's more like the difference between telling a lie and not saying anything at all.

Tax avoidance is moving from New York to Florida where there is no personal income tax. Tax evasion is staying in New York and refusing to file a NY tax return.

In this case, "avoidance" means registering and keeping the boat in a lower-tax state (Senator Kerry says Rhode Island is a good choice). "Evasion" means registering the boat in Rhode Island but keeping it in Florida.
 
#23 ·
I don't care if YOU pay taxes or not ! I don't subscribe to the "responsibility" approach as it attempts to justify and simplify an unjust and somewhat involved issue in an attempt to "shame" one into feeling as if the situation somehow merits honor.
If you can, then do. If you choose not to, then don't. but don't try to sell it to me, I'm not buying it.
If I had only known then what I've found out since then, I would be all the wealthier.
Keep your head down, light draws fire.


Live the dash - when they throw dirt in your face you'll have as much/little money as when it's shoveled into mine!
 
#25 · (Edited)
I don't care if YOU pay taxes or not ! I don't subscribe to the "responsibility" approach as it attempts to justify and simplify an unjust and somewhat involved issue in an attempt to "shame" one into feeling as if the situation somehow merits honor.
If you can, then do. If you choose not to, then don't. but don't try to sell it to me, I'm not buying it.
If I had only known then what I've found out since then, I would be all the wealthier.
Keep your head down, light draws fire.

Live the dash - when they throw dirt in your face you'll have as much/little money as when it's shoveled into mine!
Somehow I don't think I'm going to shame Larry Ellison or Mr. Perkins into anything :laugher There are many better things to do with life. One thing that can be said about paying taxes is it does tend to buy us some semblance of civilization.
 
#33 ·
Yeah, I don't understand why people hate paying taxes. Actually if you get a weekly paycheck this week starts out as the first week the money is all yours, being that from the beginning of the year until now you have worked to pay taxes and pay against the govt. dept burden. So rejoice! Look taxes pay for our smooth roads, secure boarders, and keeps criminals locked away from harming our loved ones and way of life....Uh, on second thought...Think I'll sit this one out.
 
#34 ·
What gets me is the sales tax on a used boat. The tax for the boat was already paid when the boat was new. Why should the government receive more money each time that boat is sold. For a small boat built in the 60s, and sold multiple times over the years, the government receives more in taxes than what the boat was actually worth.
 
#36 · (Edited)
Now your starting to "get it".

Wasn't there a big fight a couple hundred years ago about the whole taxation issue ?

Oh yea, we're supposed to be too dumbed down to make that connection.

my bad.
Well, I suppose it was easier when there wasn't any real land transport infrastructure, electrical grid (think TVA), compulsory education (MA was the first in 1852, MS the last in 1918), state university systems, those damned charts and buoys we use, etc... but I suppose we're too dumb to make that connection. :laugher And talk about government intrusion... that Jefferson, suggesting creating a public school system. Haruuumph....

hint: it wasn't taxation, but King G's taxation without representation. Like the current powers that be or not, they're elected, not divine. )
 
#38 ·
I believe no one would argue sensible taxation for sensible investment in infrastructure. BUT we have crazed spending freaks throwing our money around far worse than any drunken sailor I have ever seen (A drunken sailor usually stops spending when he runs out of money). We are over taxed! Except the recipient citizen of whom have recently developed a strong resentment, they spend my money and resent me for it. I'm not talking about old people on SS, I'm talking about multi-generational welfare recipients who are great great grandmothers by the time their 58. While people like my Uncle who bought a house in the 1950's for $15,000 pays $5,000 a year in taxes to keep it, he rebuys his house every 3 years! If he doesn't they will confiscate it and throw him out and move a bunch of section 8's in. So do you really ever own a house? Or just pay the loan off then rent it from the government?

One point. I am subject to urinalysis in order to keep my job, so are many other tax payers. I believe EVERYONE who is on the receiving end of my tax dollar (including politicians) get drug tested too.

I tried to stay out of this but I see tens of thousands of dollars confiscated from me every year to be thrown around at will by morons in what sometimes seems like a drug induced frenzy.
 
#40 · (Edited)
And true facts...they're so disturbing...

Regardless it's about boats here and the discussion is starting to go off track. It's understandable though since some of us could really use the tens of thousands of dollars that are taken from us so it's always on our minds...How much more boat could I afford? Others make enough that it's no big deal and some are just recipients so so the more the contributor contributes the better off they are. With that I'm finished, I'm jumping ship on this one.
 
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