Sales tax on catamaran purchase in Florida

[hellosailor]

Florida would be a most unique and generous state if they only said "Oh, by the way, you owe us sales tax because you didn't get out within 90 days" or whatever reason.

You can pretty much expect to hear "Oh, by the way? You owe us sales tax, plus penalties, plus interest at an exorbitant rate, and we're gonna seize the boat and your other assets to pay for that 31 days from now."

There's nothing wrong with tax avoidance, you've just got to be Real Damned Sure to do it correctly.

[Captain Bill]

You don't say where you are at, but if you are a Florida resident there is no getting out of the tax no matter where you take the boat or for how long. I bought my boat in Florida 12 years ago, but Ii lived in NC. (NC has no tax on sales of used boats bought from the owner). I moved the boat to NC for 6 years and had no trouble moving it back to FL. Doing what you propose will not help if you keep the boat in Fl or are a FL resident.

[tomfl]

Originally Posted by Shrew

Apologies as I mean this in the nicest possible way, however there is much incorrect information here.

Taxes are paid where the boat is registered, not where you live. Registration requirements vary by state, but typically all have requirements that the vessel be registered if boating in that state for a specified number of consecutive days.

Florida = 90 days
Deleware = 60 days.

Once you've paid taxes to the initial state of registration, no other state will levy a sales tax. Now they may have a 'use tax'. If so, I would make a point not to remain in that state beyond the number of days requiring the boat be registered.

The only connection to that state is that the boat be in the state's waters for more than the defined days.

I've never registered the boat in the state I live in because that is not where the boat is stored. The state you live in has nothing to do with the taxes.

This is just wrong, no way to sugar coat it.


As most of the posts in this thread have noted if you live in Florida, as the OP seems to indicate he does, it is very hard to avoid the sales tax in Florida. You have to keep the boat out of Florida for some time and even then Florida may come after you. As of 2010 the law stated in part:

"You have shown no intent to use your vessel in Florida at or before the time of purchase.

The boat is not owned by a Florida resident or the boat does not belong to a corporation for the use of a corporate officer or director who is a Florida resident or who owns, controls, or manages a dwelling in Florida.

Even if the boat is not initially taxable in Florida, however, the vessel will again become taxable at a rate of 6% of fair market value if the boat remains in Florida for 90 consecutive days or 183 days within a calendar year. These basic rules continue to apply."

Even if you have paid sales tax in another state you still may owe Florida money if that tax is less than the 7% Florida collects since Florida thinks they owe the difference.

The law goes on to say:

"Time spent in foreign waters does not count as part of the 6-month period."

As other posts have noted crossing all the "ts" and dotting all the "is" is a complicated, lengthy, and quite possibly expensive process that is almost impossible for a Florida resident to do if they intend to use the boat in Florida, even months from the time of purchase.

As other posts have noted if you get caught you don't just have to pay the tax, there are extra fees added on.

As bad as this may sound it is not as bad as some other states like Cali and Mass.

[skipmac]

Originally Posted by tomfl

This is just wrong, no way to sugar coat it.


As most of the posts in this thread have noted if you live in Florida, as the OP seems to indicate he does, it is very hard to avoid the sales tax in Florida. You have to keep the boat out of Florida for some time and even then Florida may come after you. As of 2010 the law stated in part:

"You have shown no intent to use your vessel in Florida at or before the time of purchase.

The boat is not owned by a Florida resident or the boat does not belong to a corporation for the use of a corporate officer or director who is a Florida resident or who owns, controls, or manages a dwelling in Florida.

Even if the boat is not initially taxable in Florida, however, the vessel will again become taxable at a rate of 6% of fair market value if the boat remains in Florida for 90 consecutive days or 183 days within a calendar year. These basic rules continue to apply."

Even if you have paid sales tax in another state you still may owe Florida money if that tax is less than the 7% Florida collects since Florida thinks they owe the difference.

The law goes on to say:

"Time spent in foreign waters does not count as part of the 6-month period."

As other posts have noted crossing all the "ts" and dotting all the "is" is a complicated, lengthy, and quite possibly expensive process that is almost impossible for a Florida resident to do if they intend to use the boat in Florida, even months from the time of purchase.

As other posts have noted if you get caught you don't just have to pay the tax, there are extra fees added on.

As bad as this may sound it is not as bad as some other states like Cali and Mass.

This is the correct information in regards to FL residents. If you are a non-FL resident and remove the boat from the state within the deadline period (and do not register the boat in FL) you're good, at least in FL. What happens in whatever state where the boat ends up or is registered is another matter.

HOWEVER, if you are a FL resident then it does get much trickier. As you and DenverDon point out, in that case the burden of proof lies very heavily on the buyer and much more evidence of legitimate use of the boat elsewhere is required.

In my case, my primary residence is FL but I purchased my boat in NY and it stayed in RI and CT for the first year. At the time I was working for a company in eastern CT and the boat was my New England residence when I was on site which averaged about 50% of the time. Also my daughter lived in RI at the time so between these two I had a good claim for non FL use. Moved the boat to FL only when I had an unplanned change of circumstance.

[BandB]

If you decide to try any of these schemes, get a Documentation Agent to assist you, one familiar with all the particulars.

[sailingforfun]

Originally Posted by pesarsten

I also believe that if you vessel is registered in another state and remains in Fl for more than 90 days, you are required to register in Florida ( and pay the tax , or difference in tax if the other state has a lower rate) or leave.

Correct me if I am wrong, but a foreign flagged vessel in US water with a 1 year cruising permit can stay in Florida for the entire year and not be subject to state tax? Is that correct?

[skipmac]

Originally Posted by pesarsten

I also believe that if you vessel is registered in another state and remains in Fl for more than 90 days, you are required to register in Florida ( and pay the tax , or difference in tax if the other state has a lower rate) or leave.

If you keep the boat in FL over 90 days, FL regulations (and most other states) do require you to register and pay the registration fee (usually under $200 in FL) but you are not automatically required to pay the sales/use tax. If you legitimately owned and used the boat outside FL for min of six months then you are exempt from the tax unless you are FL resident.

[skipmac]

Originally Posted by sailingforfun

Correct me if I am wrong, but a foreign flagged vessel in US water with a 1 year cruising permit can stay in Florida for the entire year and not be subject to state tax? Is that correct?

A boat purchased and used legitimately for at least six months outside of FL (whether another state or another country) by a non FL resident will be permanently exempt from FL sales tax.

The FL tax is only due:

1. On boats purchased in FL that stay in FL, no matter where the boat is registered or where the owner lives, even outside the US.

2. On boats purchased outside FL by a FL resident if the boat is not exempt under FL regulations.

3. On boats purchased outside FL that are brought to FL in less that six months after purchase and stay in FL after that.

[Larry Florida]

Originally Posted by skipmac

This is the correct information in regards to FL residents. If you are a non-FL resident and remove the boat from the state within the deadline period (and do not register the boat in FL) you're good, at least in FL. What happens in whatever state where the boat ends up or is registered is another matter.

HOWEVER, if you are a FL resident then it does get much trickier. As you and DenverDon point out, in that case the burden of proof lies very heavily on the buyer and much more evidence of legitimate use of the boat elsewhere is required.

In my case, my primary residence is FL but I purchased my boat in NY and it stayed in RI and CT for the first year. At the time I was working for a company in eastern CT and the boat was my New England residence when I was on site which averaged about 50% of the time. Also my daughter lived in RI at the time so between these two I had a good claim for non FL use. Moved the boat to FL only when I had an unplanned change of circumstance.

G'Day Skip

Your scenario is similar to my upcoming sail to Florida. I am a Florida resident, also have a house in NJ. Purchased my boat in February 2016 in Stamford, CT, documented with the USCG , moved her to Huntington NY June 2016. Never registered in NY, did not pay NY sales tax or any other tax which was likely due to NY or NJ, possibly Florida.

I intend to sail to Florida Nov 2017 or 2018. Was any tax was due when you brought the boat to FL.

Can anyone comment if Florida tax will be due when I arrive in Florida or is possibly due already. The tax would be $1500 so not worth sailing in and out of Florida to avoid.

Thanks

[skipmac]

Originally Posted by Larry Florida

G'Day Skip

Your scenario is similar to my upcoming sail to Florida. I am a Florida resident, also have a house in NJ. Purchased my boat in February 2016 in Stamford, CT, documented with the USCG , moved her to Huntington NY June 2016. Never registered in NY, did not pay NY sales tax or any other tax which was likely due to NY or NJ, possibly Florida.

I intend to sail to Florida Nov 2017 or 2018. Was any tax was due when you brought the boat to FL.

Can anyone comment if Florida tax will be due when I arrive in Florida or is possibly due already. The tax would be $1500 so not worth sailing in and out of Florida to avoid.

Thanks

One question, is FL or NY your primary residence? Where are you registered to vote or where is your driver's license or where do you spend most of the time?

The reason I ask, if FL is your primary residence you might be required to show a higher level of proof of the following:

The regulations as I understand them, if you purchased the boat outside Florida with the intention of keeping and using the boat outside Florida and do so legitimately (legitimately according to FL regulations) for at least six months then you should be exempt permanently from FL sales tax if you later bring the boat to Florida.

[BandB]

Originally Posted by Larry Florida

G'Day Skip

Your scenario is similar to my upcoming sail to Florida. I am a Florida resident, also have a house in NJ. Purchased my boat in February 2016 in Stamford, CT, documented with the USCG , moved her to Huntington NY June 2016. Never registered in NY, did not pay NY sales tax or any other tax which was likely due to NY or NJ, possibly Florida.

I intend to sail to Florida Nov 2017 or 2018. Was any tax was due when you brought the boat to FL.

Can anyone comment if Florida tax will be due when I arrive in Florida or is possibly due already. The tax would be $1500 so not worth sailing in and out of Florida to avoid.

Thanks

In your case Florida will absolutely seek to collect use tax. You can't have it both ways and the only reason you could possibly give for not paying NY or NJ tax is you intended to use the boat in FL. You won't qualify for exemption or reduction on the basis of having paid another state.

Yes, you might try to argue six months and intended to use it in NY or anything else, but then your defense against not paying hinges on you breaking laws in other states.

[john2445]

I bought mine 3 years ago here in FL. Maximum tax was $3,000. Check with your broker. Or FL tax collector.

[BandB]

Originally Posted by john2445

I bought mine 3 years ago here in FL. Maximum tax was $3,000. Check with your broker. Or FL tax collector.

The maximum FL sales tax is $18,000, which is what you'd pay on a $300,000 boat.. Here is a link to a document on FL Sales Tax on Boats that answers some of the questions here.

http://floridarevenue.com/Forms_libr...t/gt800005.pdf

[hellosailor]

Hm. Cut a deal with the Seminoles, put a casino on the boat, forget all about sales taxes. Immune from boardings, too. Might even make some money on the deal. Anyone argues, take 'em to federal court and claim sovereign immunity. (WEG)

[Larry Florida]

Originally Posted by skipmac

One question, is FL or NY your primary residence? Where are you registered to vote or where is your driver's license or where do you spend most of the time?

The reason I ask, if FL is your primary residence you might be required to show a higher level of proof of the following:

The regulations as I understand them, if you purchased the boat outside Florida with the intention of keeping and using the boat outside Florida and do so legitimately (legitimately according to FL regulations) for at least six months then you should be exempt permanently from FL sales tax if you later bring the boat to Florida.

My legal residence is Florida. Voting, drivers license, and state income tax purposes.