[thevdeub]

Hey,
I live in HI and planning to buy a boat in CA in June.
Only issue, I don think I can't get the boat ready to leave right away.
in HI, there is no sale taxes on used boat. In CA, it is certainly close to 10%.
Anyway I can register my boat in HI, keep the boat until next Summer (full year) in CA and sail it - when ready - at that point ?

Is it really illegal ?

Thanks,
Olivier

 

[aeventyr60]

Probably not legal. Think the term or solution maybe the 90 day yacht club in Ensenada.

 

[Rhapsody-NS27]

You not only need to be concerned about sales tax, but CA also has a Use tax. If keeping your boat in CA after the sale, you may be subject to both.

 

[MikeGuyver]

Or bring it to Oregon, we don't impound boats or rape the owners.

 

[thevdeub]

I guess the easiest would be to buy the boat officially in HI.
I just need to find a way to cover 2 months of preparation in CA.
I work mostly remote from HI for a company in LA. The only practical way for me to prepare the boat and the trip is to berth in Marina Del Rey.
Maybe if I offer to the owner a security equivalent to the value of the boat ?
Any other ideas ?

 

[thevdeub]

Actually a offshore deliver seems legal and possible for me as I am not CA resident.
California Offshore Delivery Law Firm - The Law Office of Weil & Associates - Lawyer - Law Firm - Attorney

"For non-residents, where the buyer keeps the boat in California for more than six months during the first one year after the purchase"

Which would not be my case.
Opinions ?

 

[overbored]

in California you can either register with the DVM or document the boat. If you register it then the DMV will collect the use tax at that time. If documented then the state sends you a bill for the use tax about 6 months after the sale for any boat documented with a California address

 

[christian.hess]

buy the boat, go to dmv....bill of sale for less than its worth and you get your pink slip in the mail...

simple

 

[Rhapsody-NS27]

I was sent a Use tax bill for having a CA hailing port on my boat. Just had to send proof the boat was located outside of CA. Haven't heard anything since.

 

[MarkSF]

You not only need to be concerned about sales tax, but CA also has a Use tax. If keeping your boat in CA after the sale, you may be subject to both.

Use tax IS sales tax. You don't pay both. It's called sales tax on some items, like TVs, and use tax on items like boats. It's a matter of nomenclature, that's all.

 

[MarkSF]

in California you can either register with the DVM or document the boat. If you register it then the DMV will collect the use tax at that time. If documented then the state sends you a bill for the use tax about 6 months after the sale for any boat documented with a California address

Or in my case, you pay the use tax to the DMV, then 6 months later the state demands it again!

 

[MarkSF]

Hey,
I live in HI and planning to buy a boat in CA in June.
Only issue, I don think I can't get the boat ready to leave right away.
in HI, there is no sale taxes on used boat. In CA, it is certainly close to 10%.
Anyway I can register my boat in HI, keep the boat until next Summer (full year) in CA and sail it - when ready - at that point ?

Is it really illegal ?

Thanks,
Olivier

Your best option might be to ship it.

 

[GMFL]

You not only need to be concerned about sales tax, but CA also has a Use tax. If keeping your boat in CA after the sale, you may be subject to both.

You are thinking of property tax here. In CA, use tax is what you are supposed to pay for items purchased out of state.

 

[MarkSF]

Property tax is due yearly and is about 1%. Sales / use tax is a one off tax due on purchases, and is about 9%, regardless of whether the item is purchased out of state, or in CA.

Why not do some research on the CA tax websites where you might get some ACCURATE info?

 

[christian.hess]

yup whatever it is called its around 9 percent paid on the spot at dmv...

really simple like mark says

 

[GMFL]

Property tax is due yearly and is about 1%. Sales / use tax is a one off tax due on purchases, and is about 9%, regardless of whether the item is purchased out of state, or in CA.

Why not do some research on the CA tax websites where you might get some ACCURATE info?

EXACTLY! For instance, I only pay 8% sales tax where I live.

Use tax is usually stated and paid on your tax return BTW and is only for out of state purchases. Sales tax on a boat or vehicle, if done privately, is paid based on what YOU state the purchase price is, FWIW. (hint, hint)

 

[christian.hess]

tried to hint at that before...

wink wink!

 

[GMFL]

Back to the OP's question,

What's to stop you from buying the boat in CA, taking the bill of sale back to HI and just transferring title there? Get your new HI numbers, sticker and slap them on next time you're in CA. Sail it home when you can.

 

[windward54]

Actually there are three taxes paid on California boats, but normally you only have to worry about two of them, the sales tax and the annual property tax. Sales tax is due on the purchase, you can avoid it by taking an off shore purchase. The boat has to go out of the State for at least one year. There is an exception for repairs, and the boat is allowed to stop in the State for making repairs. But the use of the boat is limited while under repair to 25 hours on the engine.

The second tax is property tax, and that is assessed on the boat if the boat is moored or docked in California on January 1st. The State actually hires people to walk docks to check on boats.

Best bet, take an off shore delivery and head for Ensenada. They do great work there and you don't have to deal with the State.

 

[Minnewaska]

Lot's of confusion above. Sales tax is paid upon sale and sometimes collected when you register. Use tax is the equivalent concept, but due upon "using" your property within the State. The concept is born from those that buy their property in another state and immediately remove it, thereby being exempt from sales tax in the state of purchase. The State you use your property withing still wants their vig.

Looks up California Sale/Use tax rules. Some states will provide a longer exemption for moving your property to your home state, if you keep the boat on the hard. I do not know CA rules.

However, forget about trying to beat the system by lying or deceiving. If you get caught (and the tax guys LOVE to catch rich boat owners), the penalties and interest will make you bleed. Do it correctly.