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post #1 of 19 Old 04-07-2016 Thread Starter
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Boat Ownership and Taxes

I hope to be in a position to purchase a boat soon. I will be semi-retired and will be able to live aboard and sail for part of the year.
I live in the Midwest and whatever boat I buy, wherever I buy it, will never set foot (or hull) in my home state.

I've scoped out marinas where I might make a home for my boat. I'm sort of favoring the central east coast (Georgia or the Carolinas, possibly Virginia, Maryland or Delaware for second choices) because it would give me the option to easily sail north to New England or south to the Keys or Bahamas and follow the most favorable weather. I've also looked at some boats on the Gulf Coast and scoped out marinas in Texas, Louisiana, and on the Florida panhandle as home port options for a while.

I'm wondering what the personal property tax situation for boats is in each of these states. If I had a boat licensed in my home state, I would pay $300 to $500 annually in taxes.
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post #2 of 19 Old 04-07-2016
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Re: Boat Ownership and Taxes

while not a true "personal property tax", MD taxes (yearly use) can be quite high on something big enough to live on, and their laws on what constitutes "their" taxable property is pretty rotten. X number of days boat is in MD, gives them the power to harrass you, the boat owner, to pony up the difference between your home port (where ever that may be) and what they dictate. They have the same mentality on sales tax...check closely before you commit to living there. Then there are the license fees, separate from the above.

Some counties in VA, since it is a personal property tax state, assess no tax on boats, while others are quite high. Sales tax used to be capped, circa 2008, not sure about the details on that in current years. On my Passage 42, slipped in Northumberland County personal property tax ran a bit over $1K yearly. And they do hire people to walk marinas and identify to the county, boats from out of county and out of state. If your boat is documented, in many counties you do not need to pay for state registration/license.
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post #3 of 19 Old 04-07-2016
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Re: Boat Ownership and Taxes

Maryland doesn't really have a personal property tax on anything, though we do have a real estate tax on homes, which has absolutely nothing to do with boats. Now, when you bring a boat to Maryland and register it, there is a tax, that is pretty much a sales tax. However, Maryland has a reciprocity agreement with many states when it comes to this. In some situations, if you have already paid the tax in your state of purchase or residence on the boat, and it is equal or greater than the Maryland tax, then you don't have to pay it again.

There is an annual registration fee of $12 for all boats other than canoes and rowboats, that is paid semi-annually. The most difficult part about your task if finding a live aboard marina at a reasonable price.

Good luck,

Gary
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post #4 of 19 Old 04-08-2016
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Re: Boat Ownership and Taxes

Not to high jack the thread but if the boat was USCG Documented would there still be a tax other than maybe a one time sales tax if purchased in a state that it is staying in?

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Re: Boat Ownership and Taxes

To assess this situation, one needs to fully understand these separate taxes:

Sales tax
Use tax
Property tax
Registration fees

They are assessed differently for each State, with some granting an offset, if you've already paid another. The one common denominator is they are only due in the State where the boat is actually present. Each state defines how long the boat needs to be present, before these are due. Whether you title the boat with USCG documentation or a State Title, makes no difference. Taxes are due where the boat resides. Of course, there are states that don't have some of these taxes/fees at all. However, to take advantage of that, you have to actually keep your boat there, which is the reason they are being competitive in the first place. RI, for example, has no sales/use tax on boats. They do have bi-annual registration fees and RI property taxes only apply to individuals who are residents.
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post #6 of 19 Old 04-08-2016
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Re: Boat Ownership and Taxes

Florida... No annual property taxes. Registration required after 90 days, with a very reasonable annual fee (less than $200 per year unless you own a mega-yacht, about $30 per year if your boat is an "antique"). Sales tax is 7%, with a cap of $18k.

And, no, Coast Guard documentation generally has no bearing on the four different kinds of taxes that Minnewaska mentioned.
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post #7 of 19 Old 04-08-2016
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Re: Boat Ownership and Taxes

Delaware has no sales tax on boats and annual registration is between $10 and $60 depending on length of boat.

But if the boat is in another state for more than 60 or 90 days depending on the state, sales tax, registration fee and possibly other taxes and fees will be due.

I would suggest select the area you desire to cruise, then investigate the costs both for taxes, fees and living expenses. The cost of taxes may not be as critical as other living expenses.
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Re: Boat Ownership and Taxes

This is probably a state by state thing, but in my experience in Washington State documentation makes no difference in taxation. If my boat is going to "reside" in Washington State (even though I'm an Idaho resident) for most of the year (can't remember exact number of days), it needs to be registered in Washington, I paid sales tax on it in Washington, and I pay my annual Washington excise tax on it too.

Only difference (again, states surely vary) w/documentation as far as state of Washington is concerned is I am not required to post state registration numbers and stickers on the boat, just follow the USCG documentation regs.

Quote:
Originally Posted by sweepint View Post
Not to high jack the thread but if the boat was USCG Documented would there still be a tax other than maybe a one time sales tax if purchased in a state that it is staying in?
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post #9 of 19 Old 04-08-2016 Thread Starter
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Re: Boat Ownership and Taxes

Quote:
Originally Posted by Ulladh View Post
I would suggest select the area you desire to cruise, then investigate the costs both for taxes, fees and living expenses.
I've already done that. I've identified suitable marinas in Georgia, North and South Carolina, Virginia, Maryland and Delaware. I would prefer to not be farther north than Dover Delaware due to cold winters and not farther south than Savannah Georgia due hot summers. And from any of those locations, I can cruise most any place I want.

So, my question is: Which state among Georgia, North and South Carolina, and Virginia, have the most favorable tax situation for 30 to 33 foot sailboats?


However, If I found the boat of my dreams somewhere along the Gulf Coast, I would probably keep it in the Gulf for the first year or two as I gain more sailing experience and get accustomed to the boat. Then I might sail it out of the Gulf and up the east coast.
I have found suitable marinas in Texas, Louisiana and Mississippi and would like to know the comparative tax costs of those states.

Thanks,

Last edited by midwesterner; 04-08-2016 at 11:09 AM.
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post #10 of 19 Old 04-08-2016
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Re: Boat Ownership and Taxes

Don't be confused by this. Interstate commerce laws prevent States from assessing taxes, unless they can establish the transaction or usage within their boarders. In fact, if you simply trailer your boat through your home state, to get to it's permanent marina, it is specifically exempt from the State having any right to tax. Otherwise, all road and rail transportation would be taxable in every state they crossed.

That said, most States are looking for the cheaters vigorously. They will check every single USCG documentation mailing address and, if they find an address in their state, they will send you a letter asking for their taxes. Assuming the boat was never there, you just have to prove it, with your bill of sale, marina rentals, etc. Be sure to keep them all. BTDT.

Further, the waiting periods, as mentioned, in the various State's, are often immediate, if you do in fact use or buy your boat in your home state. The waiting periods, which are most typically around 90 days, only apply to residents of other states to accommodate transients.


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