Sales tax on documented vessel

[Rufus]

Let's say the owner lives right on the border between two States. The boat is Federally documented. It is stored (on land) in one State for part of the year, and also operated in that States' waters for a period. The boat is also operated in the adjacent State's waters for extended periods of time. The exact division of time varies from year to year. When the boat was purchased it was taxed and registered in the first State. In order to avoid any misunderstanding with water police authorities in the second State, the owner wishes to purchase a second registration. So, the boat would now be now registered in both States. Should it be possible to do this without paying tax in the second state. (Registration is relatively inexpensive...the titling process is another story if taxes enter the picture).

 

[Bryant]

Sales tax

I bought Californian in Cape Coral, florida in Feb,2019. sent in the documentation paperwork and received the new documents in March,2020 due to issues with the correct wording on the bill of sale. I live in New Jersey ( for now, retire in a few years, maybe next ) claimed my home port as Manasquan, NJ as I intended to bring it up but the Okeechobee was too risky at that time, so I put it on land storage in Moore Haven, where it has been since.
Now for my question:Where do I pay sales tax? I contacted Lee county tax in Florida and they said see USCG? they don't do this. Do I pay tax in Florida, or New Jersey?
Worth a mention this is a 1979, I LOVE it ! Can't wait to spend the rest of my years saving turtles after 40 years as a machinist, finally doing something good with my life.
thanks all

I can answer this, having done something very similar.

You can pay sales tax in Florida when you register it in the county where it will be kept or where it is when you register it. Yes, documented vessels in Fl are required to be registered. You only display the registration decal, not the state numbers. Since it has been in storage and not in use, I don’t think you will have to pay a late fee. If you move the boat to New Jersey you will be required to pay the difference between Fl sales tax and NJ sales tax.

Unless the laws have changed (which is entirely possible) this should be your situation. Call the county tax collector in Fl where the boat currently resides. They can answer your questions quickly.

 

[Bryant]

Tax

Let's say the owner lives right on the border between two States. The boat is Federally documented. It is stored (on land) in one State for part of the year, and also operated in that States' waters for a period. The boat is also operated in the adjacent State's waters for extended periods of time. The exact division of time varies from year to year. When the boat was purchased it was taxed and registered in the first State. In order to avoid any misunderstanding with water police authorities in the second State, the owner wishes to purchase a second registration. So, the boat would now be now registered in both States. Should it be possible to do this without paying tax in the second state. (Registration is relatively inexpensive...the titling process is another story if taxes enter the picture).

Depends where you are. Here’s an actual example:

I’m military. I had a boat registered in Fl but I was stationed in Washington St. I was allowed to keep my boat in the water and use it for 90 days per year on my Fl registration and a Wa state permit which was dated and had to be displayed. After that the boat had to be pulled and stored on dry land. If I exceeded 90 days I was required to pay the difference in Fl sales tax and Wa sales tax (2.5% at the time) and register it in Wa.

 

[kthoennes]

Shrew is right. What you think ought to happen or what seems fair or reasonable has nothing to do with it, and there is no generic or general answer to the OP's question -- it all depends on the statutes, rules and regs of the multiple jurisdictions involved. We bought our documented boat from an owner who lived in MA, and as I recall the MA tax regs and advisories at the time (2015) said we had to pay sales taxes where the transaction occurred or where we took possession, even though we expected to motor the boat out of MA waters literally within a few minutes of taking possession. I took the helm -- took possession -- as soon as we crossed that invisible dotted line in RI waters. Probably way overly cautious but I wanted to follow the letter of the law, and South Dakota taxes (where we keep the boat and where we ultimately paid the taxes) were a tiny fraction of what MA would have been. Since then I know some jurisdictions -- mostly to chase sales taxes on internet purchases -- have closed that provision about taking possession and limited it to where the transaction occurred. It's a constant tax money chase.

I never quite understood why boaters seemed to have endless forum discussions about the elaborate limbo dances around tax regs. Now I get it.

 

[Ostinato]

Unfortunately because you stored in Florida for more the 90 days (or 180 with an exception) after you bought it, you owe sales tax in Florida. Florida would have given you the 90 days to get the boat out Florida before you owed taxes there.

I would call (or better still go to) the county Tax Collector for where you bought it and tell them you need to pay the sales tax. I doubt they will think twice about it but there is always that chance. Download this pdf about this at the FL Department of Revenue web site: floridarevenue.com/Forms_library/current/gt800005.pdf

When you get it to NJ you may owe the difference between what you paid in FL and what NJ charges but that is for some one else to answer.

 

[Newtrawlerowner]

Sales Tax

I bought Californian in Cape Coral, florida in Feb,2019. sent in the documentation paperwork and received the new documents in March,2020 due to issues with the correct wording on the bill of sale. I live in New Jersey ( for now, retire in a few years, maybe next ) claimed my home port as Manasquan, NJ as I intended to bring it up but the Okeechobee was too risky at that time, so I put it on land storage in Moore Haven, where it has been since.
Now for my question:Where do I pay sales tax? I contacted Lee county tax in Florida and they said see USCG? they don't do this. Do I pay tax in Florida, or New Jersey?
Worth a mention this is a 1979, I LOVE it ! Can't wait to spend the rest of my years saving turtles after 40 years as a machinist, finally doing something good with my life.
thanks all

I didn't read every response but here are my 2 cents.
Almost every state will require you to pay their sales tax if you keep the boat in that state for more than 6 months in a row. I live in Colorado and have a boat in Florida. Even Colorado has that law.


Where Do You Pay Sales Tax
You pay the tax at the county tax office. If you keep your boat in Lee County, visit that tax office. Don't be surprised if the county tax agent didn't know the answer. I paid the Florida sales tax to the brokerage when I bought my boat. I live in Palm Beach County, that's where the boat is registered. But you only need pay the sales tax if you plan on leaving the boat in the state more that 6 months in a row.



Who Enforces This?
I've never heard of anyone getting caught not paying the sales tax and I am on many of these types of sites. Anyone that has heard otherwise please post back. BUT if you decide to register the boat in Florida, the county tax collector or license plate agent office (Florida uses sub-contractors that can register your boat or car) will then require proof of sales tax paid.

I would imagine if you were to get boarded by a local law enforcement officer he could ask you to provide proof. But again I've not heard of this happening. I know for a fact the USCG won't ask.

Be aware that Florida has one registration fee for residents and another for out of state residents. Of course out-of-state residents pay more.

Florida also offers a discount if you have a registered EPIRB on your boat.

So if you live in New Jersey and register the boat there, they may want sales tax. Then a few years later you move the boat to Florida they will also want you to pay again.

In Colorado they want to inspect the boat before they issue a new registration. If New Jersey requires that, you'll have to take it there to get it inspected 1st. As far as I know Florida does not require an inspection.

One Last Thing
If you take the boat out of state, even for 1 day, the 6 month clock starts over. But I've heard you'll need a receipt to prove you were out of state. A marina and fuel receipt with the name of the boat will act as proof.

Here is a great pdf that elaborates on what I've just said.

https://www.floridasalestax.com/documents/Florida-DOR-Tax-Guide-Boat-Dealers-and-Brokers.pdf

I hope this helps

 

[Jimintheair3]

Be SMART!

Take (send) your papers to the State auditor where you WANT to keep the boat. When you documented it you STATED a HOME PORT (hopefully in the state you want to go)
You are obligated to register (pay the tax) on the vessel to that state, "at first use in that state"! Tell them "the auditor", you are getting ready to move it and want to be Proactive! Pay the fee, get the decal "some states put the same number on the decal as your Documentation #.

When you go to Fla to pick up the boat, attach the decal to the vessel. "IF" someone contacts you, tell them it is registered with ___ State. I am unable to move it, with the current situation! I can email you a copy of the registration, "if you would like"!

Me the auditor (staying indoors) "thank you very much, just following up! Have a nice day, Stay Safe!"

If you don't like this advice, call Tanya Pacific Maritime Title 206-632-4672
She can answer your questions and do the work "for a fee".

 

[guy with a boat]

. When you documented it you STATED a HOME PORT (hopefully in the state you want to go)
You are obligated to register (pay the tax) on the vessel to that state, "at first use in that state"!
.

This thing is getting beat to death but, just for the record, hailing port has nothing to do with where you may be obligated to pay tax.

 

[Bryant]

Tax

Take (send) your papers to the State auditor where you WANT to keep the boat. When you documented it you STATED a HOME PORT (hopefully in the state you want to go)
You are obligated to register (pay the tax) on the vessel to that state, "at first use in that state"! Tell them "the auditor", you are getting ready to move it and want to be Proactive! Pay the fee, get the decal "some states put the same number on the decal as your Documentation #.

When you go to Fla to pick up the boat, attach the decal to the vessel. "IF" someone contacts you, tell them it is registered with ___ State. I am unable to move it, with the current situation! I can email you a copy of the registration, "if you would like"!

Me the auditor (staying indoors) "thank you very much, just following up! Have a nice day, Stay Safe!"

If you don't like this advice, call Tanya Pacific Maritime Title 206-632-4672
She can answer your questions and do the work "for a fee".

You pay tax based on where the boat is berthed as a new purchase, documentation has nothing to do with it. This is why John Kerry wanted to home port his boat in RI rather than Mass. if you bought the boat in Fl and you keep the boat in Fl, you pay Fl sales tax. If you bought it in Fl and take it to NJ to register it and keep it there, you pay tax there. Usually, once you buy a boat and pay sales tax you can then move it anywhere you like and are just required to register it there for appropriate fees, much like a used car. Some socialist states, like Wa, require you to pay them sales taxes as well, but not all. You can document it in Ankorage, Ak if you want to.

 

[markpierce]

Simply, the only advantage federal documentation regarding state/local taxes or registration is that you are prohibited from displaying ugly state registration numbers on the hull. But that doesn't apply to your dinghy.

 

[denverd0n]

When you documented it you STATED a HOME PORT (hopefully in the state you want to go) You are obligated to register (pay the tax) on the vessel to that state...

I'm sorry to be so blunt, but this is simply and completely wrong! The home port that you choose when documenting a boat has absolutely nothing at all to do with taxes, registration, or anything else like that.

I point this out because it seems to be an issue that confuses a lot of people. The home port that you choose is simply an extension of the identification of the boat. It can be a completely random and arbitrary location. The boat does not ever have to have been there. You do not have to ever have any intention of taking the boat there. The home port you choose DOES NOT MATTER.

The only requirement that the Coast Guard has is that it be an actual place in the United States. For example... I've never lived in Kansas. I never intend to live in Kansas. My boat has never been in Kansas. There isn't any place in Kansas that I would ever want to take my boat. But if I choose to put "Liberty, KS" as my home port, the Coast Guard would be perfectly fine with that. They DO NOT CARE. And doing so would not entitle the state of Kansas to even one red cent.

So please, everyone, understand that home port has absolutely nothing at all to do with taxes, registration, or anything else like that. Nothing!

 

[keith c]

sales tax on documented vessel

Not trying to go off subject or stir the pot more but If the boat you own never exits the U.S. why document? Question #2 What % of U.S. boats exit the U.S.?

 

[Comodave]

Not trying to go off subject or stir the pot more but If the boat you own never exits the U.S. why document? Question #2 What % of U.S. boats exit the U.S.?

If you have a mortgage on the boat and the boat is large enough to be documented them most banks want it documented rather than registered with a state.

 

[Comodave]

I'm sorry to be so blunt, but this is simply and completely wrong! The home port that you choose when documenting a boat has absolutely nothing at all to do with taxes, registration, or anything else like that.

I point this out because it seems to be an issue that confuses a lot of people. The home port that you choose is simply an extension of the identification of the boat. It can be a completely random and arbitrary location. The boat does not ever have to have been there. You do not have to ever have any intention of taking the boat there. The home port you choose DOES NOT MATTER.

The only requirement that the Coast Guard has is that it be an actual place in the United States. For example... I've never lived in Kansas. I never intend to live in Kansas. My boat has never been in Kansas. There isn't any place in Kansas that I would ever want to take my boat. But if I choose to put "Liberty, KS" as my home port, the Coast Guard would be perfectly fine with that. They DO NOT CARE. And doing so would not entitle the state of Kansas to even one red cent.

So please, everyone, understand that home port has absolutely nothing at all to do with taxes, registration, or anything else like that. Nothing!

Correct. We bought a boat in Washington and kept it there for about 5 months and then moved it to California. Since we had kept it out of California for over 90 days then California sales tax was not due. A year of so later Arizona said we had to pay sales tax since the boat was home ported in Tucson, AZ. I showed them that the boat was in California and had never been to Arizona so they agreed that no Arizona tax was due. You can home port it anywhere that has a post office delivery, it does not matter where you keep the boat and sales tax depend on the individual state.

 

[JLD]

I bought Californian in Cape Coral, florida in Feb,2019. sent in the documentation paperwork and received the new documents in March,2020 due to issues with the correct wording on the bill of sale.

I'm a bit confused. Did you buy the boat in February 2019 or is this a typo?

Jim

 

[kthoennes]

If you have a mortgage on the boat and the boat is large enough to be documented them most banks want it documented rather than registered with a state.

Maybe in the coastal states, but get away from the coasts and I'll bet most banks don't even know what documentation is. Ours certainly didn't. Heck, our Game Fish and Parks officers who issue tickets for lack of state boat registration don't even know what it is.

 

[Comodave]

If you are dealing with a bank that does a lot of boat loans they do know what documentation is. And not just coastal states, we had a boat documented when we lived in Arizona. True most of the local Game and Fish LE didn’t understand what documentation was, so we had to explain it to them.

 

[Jimintheair3]

One thing the OP did not say was if a bank was involved?
If so, documentation "normally demanded"! If not, why document, lot's of money for nothing?
My previous advise was for a final solution, contact a title agent "Expert"!
O' if a bank is involved, try to use "Kanasss" as a home port, NO marina!

 

[Spinner]

In WA State, you pay a sales tax rate based upon the WA location where you bought the boat. I bought my boat in Skagit County, so that the tax rate that was used. WA State law explicitly states this for boat purchases. The county where my home is has a sales tax rate ~1.5% higher. It was a good deal :-D

 

[Jimintheair3]

In WA State, you pay a sales tax rate based upon the WA location where you bought the boat. I bought my boat in Skagit County, so that the tax rate that was used. WA State law explicitly states this for boat purchases. The county where my home is has a sales tax rate ~1.5% higher. It was a good deal :-D

Yes, you are a resident of Washington State! The OP was not a resident of FLA.

If you buy a boat in Oregon and take it to Washington "as a WA resident", you will be taxed in the county, you declare to moor it.

That's why some who buy in OR, get a slip in Westport, WA and declare it as HomePort. Tax is paid, WA dept of revenue is "happy", you have receipts. Move on!

 

[denverd0n]

That's why some who buy in OR, get a slip in Westport, WA and declare it as HomePort.

And once again, no, no, NO! The home port that you choose for your Coast Guard documentation has absolutely NOTHING to do with where you pay taxes, where you register the boat, where you keep it, or anything else like that. It is completely irrelevant to everything being discussed in this thread.


Keeping the boat in Washington may make sense, but you do NOT have to make Washington the home port for your documentation. The boat does NOT have to have a home port that matches where it is kept. Home port DOES NOT MATTER!


I really am sorry to be so blunt. I honestly do not wish to offend. But you really need to just stop talking about home port, since you clearly do not understand what it is, or what it means, and you keep on saying things about it that are WRONG.

 

[Jimintheair3]

And once again, no, no, NO! The home port that you choose for your Coast Guard documentation has absolutely NOTHING to do with where you pay taxes, where you register the boat, where you keep it, or anything else like that. It is completely irrelevant to everything being discussed in this thread.


Keeping the boat in Washington may make sense, but you do NOT have to make Washington the home port for your documentation. The boat does NOT have to have a home port that matches where it is kept. Home port DOES NOT MATTER!


I really am sorry to be so blunt. I honestly do not wish to offend. But you really need to just stop talking about home port, since you clearly do not understand what it is, or what it means, and you keep on saying things about it that are WRONG.

I simply replied to the WA resident (previous post) and tried to help other WA residents to lower their USE/SALES tax paid.
I also asked, why document? So then, who cares about home port?

I wonder, are you the EXPERT that I suggested the OP ask?

Blunt away, sorry to be so WRONG about something I do everyday!

 

[psneeld]

One often refers to homeport as the place the boat is based out of.

For documentation purposes, the homeport applied to the hull of the boat can be just about any town in the US.

Often people argue back and forth but the terms and being used for different reasons.

 

[Porgy]

I think CG Documentation calls it “hailing port.” So, maybe that term should be used when referring to the place noted on the transom of a documented vessel.

Use one’s “home port” or “home marina” or how about “Central Base of Command Operations” when referring to where one physically keeps the boat. That might keep it clear.

 

[psneeld]

I think CG Documentation calls it “hailing port.” So, maybe that term should be used when referring to the place noted on the transom of a documented vessel.

Use one’s “home port” or “home marina” or how about “Central Base of Command Operations” when referring to where one physically keeps the boat. That might keep it clear.

You are correct the USCG does use "hailing port" versus home ports on the NVDC website.

It's not that hard to know the difference between where one home ports and what the USCG requires for toy boat documentation.

 

[Devoted Sun]

I'm a bit confused. Did you buy the boat in February 2019 or is this a typo?

Jim

That is correct, USCG took 1 year to process the documentation, Lee county Florida tax office said to contact USCG documents, documents came and no way to pay taxes. Has nothing to do with it. Why tax collector told me this I don't know. This is what puts me here.

 

[Stabi]

I simply replied to the WA resident (previous post) and tried to help other WA residents to lower their USE/SALES tax paid.
I also asked, why document? So then, who cares about home port?

I wonder, are you the EXPERT that I suggested the OP ask?

Blunt away, sorry to be so WRONG about something I do everyday!

 

[denverd0n]

One often refers to homeport as the place the boat is based out of.

For documentation purposes, the homeport applied to the hull of the boat can be just about any town in the US.

Often people argue back and forth but the terms and being used for different reasons.

And I think this is a big reason why so many people get confused, and think that if they document their boat with a home port in some specific state, they can avoid taxes, registration, or whatever. (Though I will also note that the poster I was responding to, in his first post on this thread, made it clear that he was using "home port" to refer to the place you put on your hull, and list in your Coast Guard documentation.)

It is much like the people who confuse state registration with federal documentation. We often see people talk about "registering" their boat with the Coast Guard. And then we see others who think that if they "register" with the Coast Guard, then they are exempt from having to register with the state where they are keeping their boat. This kind of stuff only confuses the newbies who do not understand the difference.

I am simply trying to reduce this confusion, by making it clear that whatever city you put on your documentation has absolutely NOTHING to do with taxes, registration, or anything else that this thread is about. Precision in the terms we use would prevent a LOT of people who are new to boat ownership from being misled into believing things that are just WRONG.

Of course, now that I think about it, precision in the terms we use would probably put an end to half the postings on this forum!

 

[JLD]

I didn't read every response but here are my 2 cents.
Almost every state will require you to pay their sales tax if you keep the boat in that state for more than 6 months in a row. I live in Colorado and have a boat in Florida. Even Colorado has that law.

One Last Thing
If you take the boat out of state, even for 1 day, the 6 month clock starts over. But I've heard you'll need a receipt to prove you were out of state. A marina and fuel receipt with the name of the boat will act as proof.

Respectfully, I would be hesitant to make sure a blanket statement, as I know of several states that have different requirements, including here in Maryland, where registration is based on where the vessel is used. One really needs to check the registration requirements for the states they intend to purchase and keep their boat.

Here in Maryland, registration is tied to how the boat is used:

"If your vessel is duly registered in another jurisdiction but remains in Maryland waters more than 90 days in a calendar year, you may be liable for vessel excise tax unless you can prove principal use in another jurisdiction.

What is "principal use?" 8-701 of the State Boat Act
“State of principal use” means the jurisdiction on whose waters a vessel is used or to be used most during a calendar year, which is the period from January 1 through December 31.

“Use” means to operate, navigate, or employ a vessel. A vessel is in use whenever it is upon the water, whether it is moving, anchored, or tied up to any manner of dock or buoy. A vessel is also in use if it is kept in any structure in readiness for use."

Jim

 

[denverd0n]

Use one’s “home port” or “home marina” or how about “Central Base of Command Operations” when referring to where one physically keeps the boat. That might keep it clear.

You are right, and that would definitely keep things clear.


Sadly, too many people still use these terms wrongly. In this thread alone, in more than one post, people have used "home port" to refer to the Coast Guard "hailing port." I'm even guilty of that myself, and for that I do apologize (though I would point out that I was only responding to others who had misused "home port" themselves -- not meant as an excuse, just an explanation).


We see so many threads here about taxes, registration, documentation, and so on, and there is always a lot of confusion. Most of that comes from not being clear in the terms that we use. I will certainly make a point of trying to be more clear myself in the future. I can only hope that others might do the same.