Join Date: Feb 2010
Location: Narragansett Bay
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Re: Annapolis Boat Show October!
I did notice several pitches for "Boat as a Business". You buy the boat, take on the debt and the charter company rents it out and covers your costs. At least for the first few years, you own a boat for nothing but the down payment.
I think the Caribbean charter companies want cats mostly. I think that drives some of the display.
I hated walking past the guy in the tent, pitching this concept like an infomercial. Never buy anything that needs to be sold to you by a guy with a microphone, yelling like a snake oil salesman. I was amazed that the tent was standing room only, every time I passed. People are so often drawn to something for nothing.
The problem is that you depreciate your tax basis to zero. When the charter company is done with your boat in a few years, you have to either sell it and pay taxes on whatever it sells for, suddenly take on all those expenses yourself, like you bought it outright in the first place, or trade up into a newer bigger model and roll your tax basis forward. Guess which one the charter company pitches to you.
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