Property Tax on My New Boat !

[jazzsailor]

I just received my first property tax assessment on my new boat from the county tax collector (California). To my consternation, the basis for the assessment includes an additional county sales tax on top of the original purchase price plus the original sales tax already paid at the time of purchase. In effect they're assessing a tax on a tax, inflating the boat's assessed value an additional $16,000.00 over and above the original cost!

Would anybody happen to know if a county can legitimately increase an assessment by adding an additional sales tax on unsecured property in the state of California? Or had have dealing with this issue?

[Randyonr3]

I did.. bought a new boat, a custom Catalina 22 MKll, with a Capri keel and and 250 rudder... came from the factory...
Purchased it in Santa Cruz and paid the tax on the boat there.. When I returned to Sacramento with the boat, I recieved a letter from the assessors office stating that I was being assessed another 8%. I argured with them, saying that I had already paid sales tax on the boat...they agreed that I had paid sales tax and thier office was charging a property assestment of 8% the first year and 1% every year after...
I refused to pay it...............4 years later when I sold my rentel property, there was a lien on my personal property (the rentel) and the county got there money.
And now you know why, A guy and his wife from California, had thier boat shipped to Oregan, documented out of Coos Bay and still to this day, hold an address in Charlston Oregon.........And on the first day, of the first month, of each year, when numbers of boats are turned into the state for tax colection.. You'll find that couple a couple hundred miles off the coast, doing the tax dance........

[Chiroeurope]

Taxation without representation... ...hmmm one of the reasons a country went to war for the right of self government. Is now the only country in the world that declares the right to tax all citizens and past citizens whether they live and work within the country or not and whether or not they work for a firm of that country. It claims to be the most free and fair country in the world. Go figure.

[ssullivan]

Originally Posted by Chiroeurope

Taxation without representation... ...hmmm one of the reasons a country went to war for the right of self government. Is now the only country in the world that declares the right to tax all citizens and past citizens whether they live and work within the country or not and whether or not they work for a firm of that country. It claims to be the most free and fair country in the world. Go figure.

Indeed... go figure.

[Charlie]

I'm a fourth generation Californian but having lived in Montana for 10 years and seeing how easy it is to do buisness in other states then returned I now call this place The Grating State of Kalifornia as opposed to The Great State of California. I have bought two boats in Kalifornia and had to pay the 1% personal property tax and sales tax but not the additional 8%. I have also found that sometimes the people who serve up these bills do so without knowledge or in complete disregard for the law. Rather than get yourself in a situation where they can Grating State can lien your property ask them where they are getting their authority to charge you double sales tax. As for the specific code section that allows them to do this. I don't think there is anyway to get out of the annual personal property tax but I'd be curious to see what law they are bending to charge you a double sales tax. I can also recommend Aero&Marine Tax specialist Aero&Marine Tax Professionals I used them in a different situation than yours but they are very knowledgable. I have no financial interest in the company just a satisfied customer

BTW you can at the least protest the appraisal of the boat.

[rodney_k]

I too live and keep my boat in California. If you think the assessment is too high, call the county assessor and make an appointment to discuss the value of the boat. When I bought my 42' boat, and received my first property tax bill, I did just that.

The assessor's office was very helpful and reasonable and reduced the value of the boat to something more in line with reality. Be prepared though, as the assessor has volumes of boat sales price info. Oh, and if you liveaboard in CA, make sure the assessor knows that so that you can claim your home owner's exemption which lowers your tax bill too.

[Southern Star]

Wow, is this limited to California, or are other states now moving in on this incredible tax grab? And here I thought Canada was bad!

Brad

[hellosailor]

Taxation WITH representation, Gentlemen. From what has been posted the only questions are exactly what taxes were charged and why. If the taxes are in some way unfair--that's the fault of allowing too many idiots to vote without being able to read what or who they are voting for.

AFAIK it is illegal to charge a SALES tax on sales that take place outside of the jurisdiction. Which would mean the county is charging a USE TAX not a SALES TAX and those are the kind of differences that you need to be aware of, if you are questioning taxes.

In most states the SALES TAX is charged or collected based on the venue where the sale took place, and then adjusted to the rate where the vehicle/vessel will be registered, by proving the sale (and payment) took place, and then applying credit against the previous sales tax payment. If CA law provides for a county tax based on registration in addition to the point of sales--that might be unfair but legal. Most unusual, too.

Most state tax departments and vehicle registration agencies keep all of their regulations online these days, it should be fairly simple to find out what the laws are, and whether someone is simply double-charging in error, or the taxes are really that high out there.


That's a problem with a nation where one in five people move every year, and they move all over the place surrounded by more transients who have just crossed the border one way or another. No one understands where they are living, or what the local rules are. And no one sticks around long enough to get involved and vote the worst into, or out of, office.


So, Jazz, it sounds most peculiar but unless you do the research, or hire a local tax firm to deal with it, there's nothing beyond "I live in a high tax state" here. Yet.

[S/V Elusive]

The assessed value of the boat is the greater of: The $ you paid for it, or the assessor's assigned value PLUS what ever improvements you have made, PLUS what ever taxes you paid on it. So, in effect, you DO get taxed on a tax. There circular arguement was that the Value of the boat is ALL of what you paid for it .. including the tax. My (unsuccessful) arguement was I PAID for the boat, the taxes were paid, UNVOLUNTARILY, to the state AFTER I bought it.

Unsecured property taxes, by law, are limited to 1% of the VALUE of the boat. That does NOT mean that they can't ADD additional 'fees'. The charging of the 8% sales tax by the MOVED TO county would only occur if you could not PROVE that you had already paid those sales taxes. You MAY have to get a refund from the Selling County by PROVING you had to pay in the MOVED TO county. Good luck on that. IF, however, that wasn't a sales tax, but was some other thing, then I suspect you are SOL.

[JiffyLube]

The year that we bought our boat in San Francisco, the sales tax was not due until tax time after the first of the following year. We where mailed a form to fill out, and on the form was a way to calculate the taxes due. We sent in the amount according to what calculation we came up with by using the form, and the same year we sent the sales tax in, we received a refund from the state for sending in to much money. I reviewed the form and still came with the same tax that was due according to the form, but the state insists I overpaid...go figure. We got a letter from the state showing our property tax based on what they figured the assessed amount should be, and actually is was a little less than I thought it would be, so I didn't argue it.

[windsaloft]

Having just gotten my tax bill, and called the marin county assessor, indeed, the base value of my boat, for tax purposes, includes the purchase price from the bill of sale, and the 8% sales tax paid at the time of purchase.......and, had there been an additional broker's fee or other fees, THAT would have ALSO been included in the value of the boat to then charge the 1% property tax on. Wow. How, indeed, one can be charged property tax on sales tax........I do not get.

[TaoJones]

Originally Posted by windsaloft

Having just gotten my tax bill, and called the marin county assessor, indeed, the base value of my boat, for tax purposes, includes the purchase price from the bill of sale, and the 8% sales tax paid at the time of purchase.......and, had there been an additional broker's fee or other fees, THAT would have ALSO been included in the value of the boat to then charge the 1% property tax on. Wow. How, indeed, one can be charged property tax on sales tax........I do not get.

The following is from an article titled, "Failed States: Mexico and California."

"Fast forward to today. Gov Schwartzeneggar announced a 10% budget cut a few months ago, with additional budget cuts in progress. California is under great distress. Its economy is probably in a mild depression, much like Michigan and Ohio. The Governor recently announced the inability to float a state bond to cover ongoing expenses to run the state. So they resorted to floating some emergency measure bonds, using state lottery income as collateral. Gambling income is the only reliable income stream to the state, WOW! Watch for future attempts to print money via the back door, if desperation runs thick. Look for challenges to the federal privilege to print money. The implications could actually work toward strain in the union, as in USA. That is not my forecast, but one should expect strains to individual states to become acute. Some will want to print money. Imagine a California Dollar with a golden bear on it. Oh yes, the Governator declared a state of drought, which forced an emergency order of resource sharing for water, and some conservation measures. The state has enough problems, let alone drought. What is next, locusts? How about rising salinity levels in irrigated water?

"If California is forced to inflate with state coupon devices, or receive massive federal emergency funds, or faces widespread defaults and bond failures, conditions might arise for broad movement into gold as refuge. Vallejo already declared bankruptcy at the town level. The process is degenerating."

For the entire article, go to:

http://www.gold-eagle.com/editorials_08/willie062008.html

And it isn't like California's desperate situation is unique, really, just more obvious. One out of eight Americans is a Californian. It's an exciting, happening place. But problems are problems everywhere - it's just a matter of degree.

The old adage "little boat, little problems; big boat, big problems" could be applied here. California is the big boat of American states. Its problems emerge sooner than they might elsewhere, but they're the same problems. Trying to address those problems is no easy task, and it requires unbelievable sums of money, however it can be obtained.

And the state is just one layer of government - counties, cities, towns all have to generate the funds necessary to operate. I don't doubt for a second that there are more than a few people on government payrolls who consider taxing tax a stroke of genius.

TaoJones

[svHyLyte]

I am proud to say I am from California--far from California.

Although I was born and raised in San Francisco, as were 5 generations of my forebearers, the nuttieness of the place finally drove us out in 1993.

Not withstanding the fact that we closed our business, sold our home and moved out lock, stock and barrel to Florida, for upwards of 7 years afterward we continued to get notices, demands and threatening letters from various state and local taxing authorities, including demands that we pay state income tax, property taxes on our boat, registration fees on our cars; and, warnings that if we happened to venture there we'd be subject to arrest for "tax evasion" if the authorities became aware of our where abouts.

Good luck guys-- It's going to get worse. Southwest Florida is a paradise by comparison!


s/v HyLyte

[Charlie]

Hylite:

Where did you live in SF. I grew up in the Sunset district on 26th Ave between Lincoln and Irving. I left in 1991. Moved back to Brisbane for a couple of years in 1999/2000.

My wife had her wages garnished when she got a tax bill from the state based on a guess of how much money she had made. Her Ex husband got the house in a divorce and the state said that b/c her name was on the loan she needed an income of $XXXX to support the mortgage and she had not filed a Kalifornia Tax Return for three years (she didn't need to b/c she was a Montna resident and didn't have any Kalifornia income) she owed $XXXX * 4 and that if we did not pay in 21 days they would garnish her wages. Well we didn't pay b/c we didn't owe anything and wrote a letter of explantion telling the Grating State that she was not a resident , had no income in Kalifronia, and that the house was no longer hers as part of the divorce decree. Though how owning a house is proof that you have income I don't understand. Finally we threatened them with legal action and sent them a bill for my time (which I had documented) the cost of stamps envelopes, copying etc. They ignored the bill but we never heard from them again in regards to that matter.

[Joli]

So you're one of the many who have left California and brought on the budget deficit crisis? I read recently that fully one half of the budget deficit (~$8 billion) is blamed on the people who got fed up and "voted with their feet".

Can't tax yourself into prosperity can you? It's certainly working for California.

Soon enough we'll be cruising...........

Originally Posted by svHyLyte

I am proud to say I am from California--far from California.

Although I was born and raised in San Francisco, as were 5 generations of my forebearers, the nuttieness of the place finally drove us out in 1993.

Not withstanding the fact that we closed our business, sold our home and moved out lock, stock and barrel to Florida, for upwards of 7 years afterward we continued to get notices, demands and threatening letters from various state and local taxing authorities, including demands that we pay state income tax, property taxes on our boat, registration fees on our cars; and, warnings that if we happened to venture there we'd be subject to arrest for "tax evasion" if the authorities became aware of our where abouts.

Good luck guys-- It's going to get worse. Southwest Florida is a paradise by comparison!


s/v HyLyte