State Use Taxes

[TBill36]

Trying to understand state use taxes. Do states tax or impose a fee on out of state boats that are moored in that particular state for extended periods of time? I'm from Florida and was thinking of docking my boat in a GA or SC marina for a month or 2 this fall. Will I have to pay that state a use fee?

 

[twistedtree]

Trying to understand state use taxes. Do states tax or impose a fee on out of state boats that are moored in that particular state for extended periods of time? I'm from Florida and was thinking of docking my boat in a GA or SC marina for a month or 2 this fall. Will I have to pay that state a use fee?

Yes to the first question, but details vary for each state. There are at least 50 answers to the question, so you need to investigate each state. How long you stay, where you are a resident, what taxes you might have already paid somewhere else, etc are all factors. Also note that the requirement to pay taxes and to register the boat often trigger together, but not always, so you need to look at both.

 

[Comodave]

Yes, you may be liable for taxes in some states. You should do your homework with the state officials for the state in question. Don’t rely on what you read here because none of us will pay the taxes or possible penalties if you get bad info here.

 

[Alaskaflyer]

Yes, you may be liable for taxes in some states. You should do your homework with the state officials for the state in question. Don’t rely on what you read here because none of us will pay the taxes or possible penalties if you get bad info here.

OK, but hopefully we can still provide some information subject to verification?

I have researched Georgia due to my earlier interest in having our future vessel there. There is registration required after 60 days continuous "use" in the state. (Some sources say 90 days but DNR - who is responsible for the registration process - clearly says 60 on their website.) Registration triggers inquiries about personal property taxes however the boat must be in the state for more than 184 days per year to trigger it. The use tax is a complicated question depending on when and whether you originally paid sales tax on the purchase in another state, where you are domiciled etc etc but if you are there 60 days or less it is not due.

When you register the boat you also must purchase a separate marine toilet sticker including answering questions about your system, for a small fee.

I've no data about South Carolina.

EDIT: what is "continuous use"? I called the regional DNR office in Brunswick late last year and spoke to a LEO who said that he interprets it as "operable." Your mileage may vary, as they say.

 

[Porgy]

Many states have reciprocal use allowances. From my scribbled notes, GA allows out of state boats 60 days. SC coastal counties allow 180 days. (The default for SC is 60 but counties have the option to extend it to 180, which the coastal counties have done.)

 

[Crusty Chief]

Timely subject. Our boat is registered in OR. And USCG Documented. She is currently in So. Carolina and will be relocated within the 6 month requirement. Georgia allows us to stay for 60 days. Because of no sales tax in Oregon or property tax, we have to be diligent in locating/storing the boat anywhere for extended periods. Florida may be the next spot this winter.

 

[Larry M]

John: We bought our last boat in Alaska, there was no sales tax due. When we came to Florida and registered her there, we were told since we had satisfied the taxing jurisdiction in Alaska there was no sales tax due in Florida. There were a couple of things that came into play but that was the jist of it.

 

[Lepke]

Many states require marinas to list the boats in their docks. If you don't stay at a marina, the state doesn't know you exist. Probably the best situation is leave your boat in a no sales tax state. Most of the E & W coastal states have spending problems. Giving them more money is like giving booze to an alcoholic.

 

[PMF1984]

There is sales tax, state registration fees, state excise tax, and perhaps a local waterways fee.

I have not heard of a state not recognizing another states sales tax.

For example, I bought my boat up north and paid a sales tax. If I move to Florida and bring the boat there, they will not have me pay sales tax again - if I can show I paid it in another state.

To register a boat you have to demonstrate you paid the sales tax. (Or in the case of Alaska, show you have fulfilled your obligation.)
If you document your boat with USGG, you are still liable for sales tax.

The “operational” item is important and seems universal, even when not written down. I bought a boat in New York for delivery to Massachusetts. (Which would trigger the MA sales tax). But there were issues and the boat stayed on the hard for three years. I called the NY folks who are in charge of such things as I was clearly over the 60 day limit. They told me that the 60 days refers to “in the water.”

Sales tax is the big hit. If you want to move your boat every sixty days and try to avoid paying, well… that’s a crazy way to run your life if you ask me. But some people like cheating, so there it is.

The excise tax in MA is $160, and the local use fee is $160. Helps pay for all the waterfront infrastructure we love.

 

[Comodave]

We bought our last boat in Virginia and 8 months later brought it home to Michigan. We paid 2% sales tax in Virginia. Michigan sales tax is 6% so they gave us credit for the 2% and we just paid 4% to Michigan.

 

[BandB]

Trying to understand state use taxes. Do states tax or impose a fee on out of state boats that are moored in that particular state for extended periods of time? I'm from Florida and was thinking of docking my boat in a GA or SC marina for a month or 2 this fall. Will I have to pay that state a use fee?

Every state has different rules. However, typically registration is the first sign of something needing to be done and most states allow you to be on their waters continuously for up to 60 or even 90 days before you're required to register. You can and may have multiple registrations in a year. However, if you're in GA for 59 days and then SC for 59 and then back to GA for 59 and on to FL you'd not have to register in either GA or SC.

Why do I mention registration first? Because that's what triggers sales or use tax. If you had to register in another state, you would then be subject to their rules on sales and use tax. However, having to pay anything is unlikely unless it's a new boat. They provide exclusions based on sales taxes you paid in other states, based on time of ownership, and based on other factors.

As an example, if you bought a boat and paid FL sales tax and moved it to GA permanently the following day and you were a GA resident, then you might have to pay additional use tax for the difference in GA and FL sales taxes on the boat. But that isn't your situation. You're not a GA resident. You've owned and used the boat in FL, so highly unlikely you'd be assessed any use tax in any other state.

Registration fees are generally small. The only other tax you might be subject to is property tax but that's just in certain states and has it's own set of rules. It typically requires the boat there on January 1 and that state to be your principle place of use. Again, each state with it's own rules.

I've never personally known a cruiser of a properly registered boat to be assessed any sales or use tax in another state. I've known a few cruisers to be required to register their boat in other states. Some states and even counties are more diligent than others. Keep marina and fuel records to show how long you've been there.

 

[DonW28]

I can only speak to SC and Florida as I have experience with both recently. Porgy and Crust Chief are spot on with SC. If you have a documented boat and keep it in SC less than 180 days you are good. Otherwise you will owe property taxes.


Florida is a strange one to me. If you buy a boat and register in Florida (required even if documented if you are staying there) then you may owe sales tax. If you paid sales tax on the purchase elsewhere you get some or complete credit. But if the boat was purchased more than 6 months and 1 day before it entered Florida there is no sales tax due. For me there was no sales tax on the Mainship but we do owe it on the used dinghy we recently purchased. And if you have a bill of sale that spells out the value of the boat/motor/trailer (outboards only) then you only pay the tax on the boat part. It does pay to read the rules and even call. I did that with Florida just to confirm the 6 month rule as I found it hard to believe that I owed tax at 5 months but not at 6 months. Florida revenue officer was actually sorta funny when he said we had to make the cutoff somewhere. Guess he has a point.


Don

 

[kthoennes]

Yep, potentially 50 different answers. In South Dakota there's a registration requirement after 60 days, but no use tax or annual property tax on boats or vehicles (zero, for anybody, state residents or otherwise). There is initial sales tax (unless you paid it elsewhere) but as I recall it's very low. Only annual registration renewal after that, about $20 per year for us.

A couple years ago the state also instituted an optional local registration system for certain areas or bodies of water due to zebra mussel infestations. You do a local registration which means you don't intend to remove your boat from certain already-infested bodies of water or certain zones and therefore you don't have to submit to Game Fish & Park inspections and draining and cleaning requirements (until you ultimately leave the zone someday). It's free, no charge. Relieves us of having to get inspected or hot-water blasted every time we pull the boats for any reason. My point is, yes, you'll get 50 different answers to registration and taxation requirements, right down to little shelled creature requirements.

 

[MYTraveler]

There is sales tax, state registration fees, state excise tax, and perhaps a local waterways fee.

I have not heard of a state not recognizing another states sales tax.

For example, I bought my boat up north and paid a sales tax. If I move to Florida and bring the boat there, they will not have me pay sales tax again - if I can show I paid it in another state.

My understanding is subtly different. In your example, if the tax you paid up north is less than the tax you would otherwise be required to pay in Florida, Florida will charge you the difference. In other words, you get credit for the tax you paid in another state, but a higher tax rate state will want your total tax obligation to be the same as their law otherwise imposes.

 

[fgarriso]

Our boat was in GA. at the Brunswick marina for one year. The GA DNR checked us one time, and said it wasn't worth the trouble. Our boat is owned and operated by a USCG Documented, Delaware Blind LLC so it doesn't show an individual owner. GA said they needed to put a name on the summons not an LLC. I didn't have a name or address for them so they just wrote it off.

 

[BandB]

Our boat was in GA. at the Brunswick marina for one year. The GA DNR checked us one time, and said it wasn't worth the trouble. Our boat is owned and operated by a USCG Documented, Delaware Blind LLC so it doesn't show an individual owner. GA said they needed to put a name on the summons not an LLC. I didn't have a name or address for them so they just wrote it off.

I must ask this. Why did you choose not to comply with GA law? Simple enough to register the boat. Cost is $210 on a boat your size.

 

[rslifkin]

I must ask this. Why did you choose not to comply with GA law? Simple enough to register the boat. Cost is $210 on a boat your size.

I'm not sure it's quite that simple if the boat were to be only state registered in another state, but not documented. You'd have to cancel the original registration, register it in the new state, put on new numbers, etc.

 

[fgarriso]

I must ask this. Why did you choose not to comply with GA law? Simple enough to register the boat. Cost is $210 on a boat your size.

I did not intend to stay in GA that long. I also travel to several other states.
We were doing the Great Loop over two years.
GA registration required a name and GA address.
Things are not all that simple when you travel full time.

 

[BandB]

I'm not sure it's quite that simple if the boat were to be only state registered in another state, but not documented. You'd have to cancel the original registration, register it in the new state, put on new numbers, etc.

No, you don't have to cancel another registration. Can be registered in multiple states.

 

[BandB]

I did not intend to stay in GA that long. I also travel to several other states.
We were doing the Great Loop over two years.
GA registration required a name and GA address.
Things are not all that simple when you travel full time.

I understand not planning to be there that long. As to name, can be a business entity. Does not require a GA address. Any mailing address. Requires identifying the GA county it's in.

Fortunately enforcement is easy on boat owners. On autos, they take it far more seriously.

 

[rslifkin]

No, you don't have to cancel another registration. Can be registered in multiple states.

That might be the case if you're documented, but not if you're only state registered. You can only show 1 set of numbers and the registration or title (depending on the state) is your proof of ownership.

 

[HTurner]

That might be the case if you're documented, but not if you're only state registered. You can only show 1 set of numbers and the registration or title (depending on the state) is your proof of ownership.

Titling and registering are two different things.

 

[fgarriso]

I understand not planning to be there that long. As to name, can be a business entity. Does not require a GA address. Any mailing address. Requires identifying the GA county it's in.

Fortunately enforcement is easy on boat owners. On autos, they take it far more seriously.

I will attempt to answer you questions one at time.

1. COST - "If the watercraft is valued over $5,000 according to current Blue Book or NADA Guide, the applicant must post a bond equal to the value of the boat plus 20%. After one year, the applicant can request the bond be released. " GA application

2. TIME IN STATE - Some states we were in their waters less than 24 hours.

3. Some states require TAXES to be paid at time of registration.

4. REGISTRATION NAME - "BUSINESS NAME (only if business registration -place contact person above)" Do not wish to have my name attached to registration.

5. DRIVERS LICENSE # - Do not hold a STATE drivers Lic.

 

[BandB]

I will attempt to answer you questions one at time.

1. COST - "If the watercraft is valued over $5,000 according to current Blue Book or NADA Guide, the applicant must post a bond equal to the value of the boat plus 20%. After one year, the applicant can request the bond be released. " GA application

2. TIME IN STATE - Some states we were in their waters less than 24 hours.

3. Some states require TAXES to be paid at time of registration.

4. REGISTRATION NAME - "BUSINESS NAME (only if business registration -place contact person above)" Do not wish to have my name attached to registration.

5. DRIVERS LICENSE # - Do not hold a STATE drivers Lic.

Maybe I've gone blind but looking at GA application and don't see the bond requirement. Regardless, I'll admit a lot of nuisance factor. I'd remove it from the state periodically to avoid having to register in other states. We've been very careful in that regard.

 

[ssobol]

There are more the 50 answers. In VA it goes by county, not the state. There are some counties where you pay no tax on your boat, others where it is personal property tax. You register your boat with the state and pay tax to the local authority (or not).

Also, in some states it depends on why your boat is there. There are some exemptions if you bring your boat (or plane) into a state to get work done on it.

 

[markpierce]

Pay the taxes and be a responsible citizen. ... Vote wisely.

 

[Judy at JWY]

Additional information for Florida Sales and Use tax:

Somewhere between FYI and self-promotion, the State of Florida offers a benefit to using a yacht broker. If you purchase a boat in the State of Florida, a broker can offer a choice of sales tax exemptions with the most common being checking the box on the form good for 90 days. That means you can buy a boat in Fl. through a licensed broker, fill out the paperwork, and cruise our waters for 3 months without paying a sales tax. But you must submit proof of having left the state by the 90th day and not return for 6 months. For an additional $450, the broker can fill out the form that extends the stay to 180 days. That's 6 months in Florida waters with no tax. None of this applies to a boat purchased privately without a broker. One more helpful hint, Florida caps the sales tax at $18,000.

There are additional ways of "beating" the states' sales tax, and I have helped many clients do so successfully and legally. However, my personal opinion is if you have made enough money in our beloved country to afford a boat, pay your taxes and help support the states providing you with boating benefits.

 

[rslifkin]

Titling and registering are two different things.

Not always. My boat is NY registered, not documented. And due to the age of the boat, I just receive a transferable registration, no title.

 

[friz]

.....if the tax you paid up north is less than the tax you would otherwise be required to pay in Florida, Florida will charge you the difference..... .

That statement contradicts Larry M's statement about 0% sales tax in Alaska was honored as tax obligation fulfilled in Florida. I like Larry's statement.

 

[Larry M]

…When we came to Florida and registered her there, we were told since we had satisfied the taxing jurisdiction in Alaska there was no sales tax due in Florida. There were a couple of things that came into play but that was the jist of it.

One of the things that came into play was the length of time from when the boat was purchased to when it came into Florida. Coming from Alaska it easily exceeded the States requirement. I don’t believe you could buy a boat in North Carolina pay the 3% sales tax up to $1,500 then go directly to Florida and register it there with no sales tax due.