Avoiding Sales Tax

[nes]

We have been paying "our fair share" of taxes in this state long enough. So, yes upon retirement age, we will be taking our income out of this state, and our future purchases will all be done out of state. This state won't get any more of our tax money. Now, if the tax was reasonable, and fair, this would be a different discussion. The concept that you must pay both a sales tax and property tax on a boat or sales tax and registration fees on a car/motor home (motor home fees are slightly higher than property tax for same price item) is just plain wrong.

[denverd0n]

Originally Posted by sww914

I'm not lining up at the "pay more taxes here" door, that's for sure. I'd rather stand in the "pay what you're legally obligated to pay and no more" line.

Isn't it funny how those who suggest that others should line up in front of the "pay more taxes here" door never seem to do that themselves? The effort that THEY will go to in order to reduce their taxes is always just normal and acceptable and covers their "fair share", but anyone who goes to a little MORE effort is trying to "evade" taxes.

[Etuna]

There are a couple of ways to legally avoid sales tax on the purchase of a vessel for use in California. Under all methods you will need jump through some hoops but if you are willing to do that it isn't difficult to meet the requirements. As an aside for those wading into the tax policy area - this method was established in California so that application of CA sales and use tax law by the BOE will not violate the US Constitution's prohibition on undue taxation of interstate commerce. Some states have established bright line rules in this area and California is one of them.

The bottom line is that you should seek help from a tax professional that has done this before and has defended it under audit. Documentation of the transaction steps and the proper form of the transaction are key (sales and use taxes generally respects form over substance unlike other US taxes so the form must be perfect).

The most common way to do this is to execute the sale in Oregon (OR doesn't impose sales or use tax) and then follow the required steps in reg 1620. Execution of the sale outside of CA makes the potential taxable event a use tax transaction which falls under 1620. The key is to follow the steps correctly - usually this means keeping the vessel out of California for 12 months. However, it is possible to keep the vessel out of California for just > six months and still qualify but additional hurdles will need to be passed under that method. You're best bet is to find a local person that specializes in sales and use tax - look for someone with big four accounting firm experience and prior experience as an BOE auditor. Skip the big four themselves they will take you to the cleaners with their rates.

good luck

[foggysail]

Originally Posted by savoir

You mean people like John Kerry ?

Well.........yes. And I posted something about our Senator on this topic months ago. Somebody bitched to a moderator complaining it was political and the post got edited....no more John Kerry in my post. But POOP IS POOP and a simple edit/delete does not change POOP to ROSES.

Foggy

[savoir]

Gosh ! It sure took a while for someone to pick up on my little jab. For those who were not aware.

Sen. Kerry docks yacht in R.I., saves on taxes - Politics - msnbc.com

It isn't just a Democrat tactic either. Arnie did the same thing with his Gulfstream jet.

Do as I say . . . . .

[Doodles]

Originally Posted by savoir

Gosh ! It sure took a while for someone to pick up on my little jab. For those who were not aware.

Sen. Kerry docks yacht in R.I., saves on taxes - Politics - msnbc.com

It isn't just a Democrat tactic either. Arnie did the same thing with his Gulfstream jet.

Do as I say . . . . .

A politician took advantage of a tax loophole ... I'm shocked!

[Uncle Buck]

Regarding California.

I was told by and old timer on the dock that if you purchase a boat and you document her with the CG rather than state register with the DMV that you do not pay sales tax. Instead, you then pay property tax if/when the local tax authority tracks you down. Conversely, if you state register rather than document you pay sales tax but not property tax.

Can someone please clarify? I'm skeptical about his advice, and reading this thread leads me to believe one must pay both sales and property tax regardless of whether state registered or documented.

Thanks for your help.

[savoir]

Registration outside CA is only part of the equation. If that is all you do then the tax man will get you. There is lots of detail in this thread and the links.

[Mountainview42]

Money makes the world go around...la-la-la-te da. We all supposedly "Know" this little tidbit, yet every day I see signs that most folks are basically clueless on this.
Now who has not heard, or better yet, does not understand this little ditty:If you want to get to the root of a situation..."Follow the money trail".
So everybody who wants a good belly laugh, follow along here as we look at that ever so funny 10 ton elephant in the room. You know the one, the one that almost everybody is trying to pretend is not really there.

The People, and I mean John and Mary Q public, are like plankton in the big Ocean food pyramid.
Everything else eats (taxes) them, everything else controls and dictates everything they can and can not do.

Governments (complete with politicians) are next up on the food chain. They produce nothing. They contribute nothing (positive). They are the prison guards, the bought and paid fo
r enforcers, aka thugs for their masters. Which brings us to the next level of the food pyramid.

Big Multinational mega corporations. Now they do produce...but most of what they produce is tainted by massive pollution, human exploitation and...well, not the sort of people I would invite over for dinner.
And everything they do is done with one goal as paramount above everything else: PROFIT AT ANY COST.

Which brings us to the top of the food chain, the great white sharks if you will: International banksters.
And yes, this includes our beloved FEDERAL RESERVE.
Now this little group runs the whole kit and kaboodle.
But how is that you ask?
Well remember, we were following the money...?
Well surprise surprise, we found it. This group controls everything else because they control every single aspect of monetary existance. Not only do they create money out of thin air, and loan it "AT INTEREST" to everyone else. Oh no, they also control all the interest rates and the actual volume of money printed.
So what you say, you are bored already? Well by controling rates, and volume, and value, and who does not get any, they have an iron grip on the throat of the whole world.

Ok, so I promised a good belly laugh, here it is.

John Q public walked into a bar and started complaining about how the government was taxing him and controling his every aspect of being.

A slightly drunk patron said: Them darn conservatives, they are the cause of it all. And a small roar went up, yeah!!!

Then another (slightly drunk) patron said no, them darn Liberals are the cause of all our problems. And another small roar went up. yeah!!!

Then a seemingly wise man, who was not even drinking spoke up, and he said: People, those are just 2 bought and paid for sides of the same corrupt coin. Big International business is the real cause of all our problems...
And it got so quiet in the bar that you could hear a mouse fart.

And then the bartender spoke up, and he said: No, the real culprit behind this all is a small group of International banksters, including the FED. They are the ultimate puppetmasters, and everything else is just their puppets.
Now who wants another drink?

But everyone just got up and shuffled out of the bar.
One man was heard mumbling about how the bartender had gone mad and had lost his mind.

And if you're not just howling and rolling on the floor, or mumbling and walking out...then maybe, just maybe you are actually getting the joke.

Because we all are the joke.

Now I pointed out the 10 ton elephant here because I find it so amusing that 90% of people still argue over which is better (or worse, red or blue. Ha-ha-ha, it is all the same...all the same.
The same type of people used to argue for hours over the Ford vs Chevrolet (insane) debate.

Are Hunters really blue water capable?
Is a wharram cat actually better than a sevylor tahiti inflatable?
Come on people...think.

[savoir]

I sure hope you feel better now. Sometimes ranting can be therapeutic.

[Mountainview42]

Ah a slighty drunk patron mumbling as he walks out of the bar...
And I feel fine.
Have a delluded view, er I mean different view.
Well by all means tell us how "Things" actually work in your world.
It does not have to be factual of course, just entertaining if it is going to make the 5 oclock news.
I notice that you do not dispute this rather general overview of the way things really are.
Hey, don't shoot the messenger.
And btw, do you feel better when you post a non-value added comment...? Interesting.

[savoir]

I feel a mod attack coming on . . . . . .

[nes]

Originally Posted by EvanStolze

Regarding California.

I was told by and old timer on the dock that if you purchase a boat and you document her with the CG rather than state register with the DMV that you do not pay sales tax. Instead, you then pay property tax if/when the local tax authority tracks you down. Conversely, if you state register rather than document you pay sales tax but not property tax.

Can someone please clarify? I'm skeptical about his advice, and reading this thread leads me to believe one must pay both sales and property tax regardless of whether state registered or documented.

Thanks for your help.

My boat is registered with the CG, and I paid Sales tax and I pay property tax..... BTW, when I said that I had no intention of paying sales & property tax to the state of California when I purchase my next boat, I also have NO intention of using it in California, or keeping it in California, or of staying in California, I have had it with this state.

[CarlF]

Evan, you're right to be skeptical of the old timer on the dock. As far as I'm aware, U.S. CG (e.g. Federal) documentation doesn't have any impact one way or the other on state taxes owed in any state.

I understand that the U.S. Federal Reserve is also part of a shadowy global conspiracy to corner the world's lead supply by outlawing monohull sailboats. They're after our keels! This will effectively put an end to the mono-cat debates on this forum. Next they'll be after our anchors (for the zinc).

Carl

[savoir]

Originally Posted by CarlF

Evan, you're right to be skeptical of the old timer on the dock. As far as I'm aware, U.S. CG (e.g. Federal) documentation doesn't have any impact one way or the other on state taxes owed in any state.

I understand that the U.S. Federal Reserve is also part of a shadowy global conspiracy to corner the world's lead supply by outlawing monohull sailboats. They're after our keels! This will effectively put an end to the mono-cat debates on this forum. Next they'll be after our anchors (for the zinc).

Carl

Partly right on the first paragraph. It does make it harder for the BOE man to find you. He will have to walk the dock rather than push a button on his computer. They really do walk the docks. In SD it was about once a month.