It totally depends on the state in which you plan on keeping/using the boat. Each state has it's own requirements as to sales and use taxes on boats kept or used in their states. The general rule is that, regardless of whether a vessel is documented, it must still comply with state laws and pay applicable state taxes (including sales or use taxes). The hailing port you choose when documenting has no impact on state taxation. If you are in CA, you may want to take a look at this CA publication: http://www.boe.ca.gov/pdf/pub79.pdf. There is another discussion thread on this topic at: http://www.sailnet.com/forums/gener...forums/general-discussion-sailing-related/72591-use-tax-documented-vessels.html. It may have some other info.

 

Consider the 90 day yacht club....

Loophole You Can Sail a Yacht Through - latimes

 

I believe they've actually closed that loophole. The Governator signed the legislation making it a year wait now, back in 2008?

 

Use tax will be paid to the California BOE based the tax schedule for where the boat is to be keep and then the county tax goes to the county where the boat is keep on January 1 of each year. County tax will be 1% of the purchase price on the first year and be base on the current assessed value each year after.

 

If you are a CA resident and the boat will stay in CA then absolutely CA will want their pound of flesh.

Any variation of those two parameters then you may or may not have to pay sales tax but you better be prepared to fight it out with CA because they are known to be extremely aggressive in pursuing tax revenues, sometimes when they are legitimately exempt.

 

california state bureau of equalization is where you pay sales tax on documented vessels.
they find you if you donot find them.

 

Register in Delaware no tax.

 

This is bad and dubious advice, unless the boat is located in Delaware.

States with sales/use tax laws, which are most of them, want to collect that sales or use tax for every and any vessel for which it is due. If you live in one of those states, or keep you boat there, you need to deal with the sales or use tax. If you do not, and the boat is in CA eventually a harbormaster or sheriff or city or county agent will come across your boat and you will get a demand tax bill, for the sales/use tax, plus a penalty and interest from the date of original sale. Unless you can conclusively prove that you did not and don't owe that tax, you will end up paying it, the alternative being perhaps to leave the country and not return.

The taxing agencies are very aware of the desires of the boating public to not pay these taxes, and have organized their efforts to seek out, identify and tax every and any vessel subject to the tax.

In some of the other threads on sales/use tax, you may find my story of paying a MA use tax demand, even though I then lived in MN and had sold the boat several years before.r

 

buy a documented boat in cali and federally document it while in cali you will be found and taxed.
you have 30 days to relocate out of state before they get you on their rolls.
they will place liens for nonpayment.
the 90 day yacht club is currently 1 year, thankyou to terminator.

 

Thank you all for the advise. I bought the boat in Dana Point, CA and is now in Moss landing, CA. I called the franchise tax board and they did not know. I will contact the Use Tax Section referred in one the link given.


Thank You,
Charles

 

I called the CA franchise tax board and could not get a clear answer from them. Anyway I will contact the Consumer Use Tax shown on the link provided above.
Thank you all for the advises.

Charles

 

You're contacting the wrong people. That's why they can't answer your questions.

In most states, when you buy a car, you pay the sales tax when you transfer the certificate of title into your name. That's also how sales tax is collected on the purchase of a boat. You'll pay it when you transfer title into your name.

On the certificate of title or bill of sale, there is usually a place to state the purchase price. The amount of tax you pay will be based on that price. Some people lie about the price, but the states are pretty clever at finding out if you're fudging. If they catch you, a fraud conviction might cost you much more than the sales tax. You'll ultimately have a happier life in the future if you just pay it.

 

california board of equalization is the gang to contact with these sales taxes.

 

If you don't plan on keeping the boat in Ca. and haven't already signed the paper work talk to your broker about doing a offshore purchase.

 

after purchase in cali , you have 30 days to remove boat from cali waters before they come get you--per bureau of equalization.

 

It makes more sense to think of USCG documentation to be a form of Federal Title, rather than State title. It's a record of ownership and liens. That's all. No state tax/fee impact.

Registration makes sense to think of as a permit to use something within a state. Many states still require Federally Documented (titled) boats to register, if they remain within the State's water for a defined period (often 90+/- days). You often pay the same registration fee, you just don't display registration numbers. Each state is slightly different.

Sales/Use tax laws also differ by state and are also based upon your purchase or use of something, within their boarder. Some collect them with registration, others require you send them in with your annual income taxes, etc.

Forgetting to pay or paying the wrong state, will earn one fines and penalties. Trying something like registering in Delaware and pretending one's boat is not permanently in CA, is willful tax evasion and will get one arrested. As it should.

 

We bought our current sailboat in Florida 20 years ago and registered it in CT (our home state/port) and had it documented at the time of sale.
Our point of FL departure was on the west coast and we had just so many days to remove it from FL or pay FL sales tax. Well, we got it to NC about 2 1/2 weeks later and bought fuel to obtain a receipt verifying we were out of FL. I mailed that receipt to the FL revenue folks within the deadline and continued on to CT, where we arrived less than 2 weeks later.

Lo and behold, FL had sent me a dunning letter that crossed in the mail wth my verification of having left FL. That was settled, but then CT decided that the boat must have cost more than my bill of sale indicated and required that I provide a copy of the check that went to the previous owner or pay an additional $3000 in sales tax.

Well, this was a third party transaction through a legitimate financial organization, which then provided a copy of the check (which I never saw) and that settled the issue. Truth to be told, I got a very good deal on this boat!

So, my bottom line is that the states can be very aggressive in going after sales/use tax, as others, like Minnewaska, have said. Take this issue seriously!

 

Yes, sales tax and property tax (for USCG documented one) for CA resident.

 

They'll find you and you'll get a bill. My bill went to an old work address in CA, where I had been a contractor and not an employee so no idea how that happened, and so I never received the bill. Don't pay that bill and you will get a lien, late fees and a ding on your credit record. Call the county tax office where you plan to keep the boat. The bills are sent in late summer. Due by Oct 1, I think.

 

In several states like MA, the tax/use bill for a purchase boat is due at the time of the purchase, or when the boat is brought into the state. Sales/use tax payments are related to the a one-time event not to an annual schedule, perhaps you are thinking for an annual excise tax, where the state sends the tax bill one a year with payment expected on the same date annually.

 

there is no annual excise tax in cali. there is sales tax from boe, and there is property tax from the counties. that is all.
we are talking documented boats.
registered boats do a registration every couple of years.