Sales tax on catamaran purchase in Florida

[Moontide]

Think many are mixing sales tax and property tax. Sales tax in FL follows the 90 day rule. Not sure about FL but most states (counties) assess annual property tax based on where the boat is. Some, like California, try to collect property tax after boat leaves. Their line is show it registered in another state. Takes a while but they know they can't collect if it left tge state, whether or not registered elsewhere. (Think long term cruisers)

As far as being worth the effort, depends on price of boat. I saved over 30,000 which mostly paid for shipping it to Ensenada, MX so I would say well worth the effort.

Also, I'm not sure about the boat having to touch RI waters. Mine was previously registered there and I just set up a RI Corp to own it. Cost a few hundred dollars.

Bill

[skipmac]

Originally Posted by BandB

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.

FL has no jurisdiction or enforcement on what happens in NY and FL taxes and regulations are not connected with what happens in NY or any other state. If someone breaks the law in one state that has nothing to do with what happens in another other than to cooperate in extradition in the case of a criminal offense.

If Larry Florida qualifies for the FL sales tax exemption then he is exempt, regardless of what does or does not happen with NY. It is up to NY to determine if he has violated their regulations.

In this case, he purchased a boat over a year ago, kept and used that boat legitimately in another state where he also had a legal residence. Based on LF's description of the situation it seems quite clear that the boat was not kept out of FL just to avoid the FL sales and use tax and further, it seems quite clear that he has complied with FL law.

[skipmac]

Originally Posted by Moontide

Think many are mixing sales tax and property tax. Sales tax in FL follows the 90 day rule. Not sure about FL but most states (counties) assess annual property tax based on where the boat is. Some, like California, try to collect property tax after boat leaves. Their line is show it registered in another state. Takes a while but they know they can't collect if it left tge state, whether or not registered elsewhere. (Think long term cruisers)

As far as being worth the effort, depends on price of boat. I saved over 30,000 which mostly paid for shipping it to Ensenada, MX so I would say well worth the effort.

Also, I'm not sure about the boat having to touch RI waters. Mine was previously registered there and I just set up a RI Corp to own it. Cost a few hundred dollars.

Bill

No property or ad valorem tax in FL.

[skipmac]

Originally Posted by Larry Florida

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

Since you have owned the boat for 16 months you should be fine, as long as you can document that the boat was kept and used in NY.

[mr336]

Im in the same boat. Me, a Florida residence who just sold my house. Don't own any real estate. Plan on leaving for good in 60 days. The experts are still telling me I need to pay FL sales tax. At $18,000 clams. Its BS to me if I don't plan on coming back and taking the boat out of the state pronto.

Maybe check into creating a BVI offshore business and register the boat there. I got a quote for $5200 bucks to create the business and do the paperwork for the boat. That covers the first year. Then it's $1200 to $$1500 bucks annually to keep the business going.

Im also dealing with import/duty tax. It's tricky stuff for sure. I'm just gonna leave my AIS off. They'll never catch me.

[tomfl]

Originally Posted by 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)

Always a good idea to get legal advice on the internet.

No one ever got in trouble doing that. There are plenty of threads about tax on boats on CF. Some are real horror stories about some state DOR claiming years after the sail that the boat owner owes not just taxes but accumulated interest and in some cases additional fines.

Part of the problem with threads like this is that in most cases there are a lot of details left out so even if someone is a broker or lawyer they may not be able to offer the right advice. In general if you think you have a way to avoid tax your best bet is to consult a lawyer, or perhaps a broker, face to face.

[BandB]

Originally Posted by skipmac

FL has no jurisdiction or enforcement on what happens in NY and FL taxes and regulations are not connected with what happens in NY or any other state. If someone breaks the law in one state that has nothing to do with what happens in another other than to cooperate in extradition in the case of a criminal offense.

If Larry Florida qualifies for the FL sales tax exemption then he is exempt, regardless of what does or does not happen with NY. It is up to NY to determine if he has violated their regulations.

In this case, he purchased a boat over a year ago, kept and used that boat legitimately in another state where he also had a legal residence. Based on LF's description of the situation it seems quite clear that the boat was not kept out of FL just to avoid the FL sales and use tax and further, it seems quite clear that he has complied with FL law.

The point is that he doesn't qualify for the exemption if he hasn't paid tax in another state.

[BandB]

Originally Posted by Moontide

Think many are mixing sales tax and property tax. Sales tax in FL follows the 90 day rule. Not sure about FL but most states (counties) assess annual property tax based on where the boat is. Some, like California, try to collect property tax after boat leaves. Their line is show it registered in another state. Takes a while but they know they can't collect if it left tge state, whether or not registered elsewhere. (Think long term cruisers)

As far as being worth the effort, depends on price of boat. I saved over 30,000 which mostly paid for shipping it to Ensenada, MX so I would say well worth the effort.

Also, I'm not sure about the boat having to touch RI waters. Mine was previously registered there and I just set up a RI Corp to own it. Cost a few hundred dollars.

Bill

No property tax in FL and impossible to save $30,000, when FL's maximum sales tax on a boat is $18,000.

To the OP, get with a Florida based documentation service and they'll give you all the legal options.

[BandB]

Originally Posted by mr336

Im in the same boat. Me, a Florida residence who just sold my house. Don't own any real estate. Plan on leaving for good in 60 days. The experts are still telling me I need to pay FL sales tax. At $18,000 clams. Its BS to me if I don't plan on coming back and taking the boat out of the state pronto.

Maybe check into creating a BVI offshore business and register the boat there. I got a quote for $5200 bucks to create the business and do the paperwork for the boat. That covers the first year. Then it's $1200 to $$1500 bucks annually to keep the business going.

Im also dealing with import/duty tax. It's tricky stuff for sure. I'm just gonna leave my AIS off. They'll never catch me.

As to experts are you dealing with a documentation service? They're the only true experts in this area I'm aware of.

Now, I see you're also dealing with import taxes. But putting those aside for a moment and if all you were dealing with was sales tax, then would it be worth $5200 up front and $1500 a year plus the bother to comply with all rules to save the $18000? In 10 years time it's actually cost you more and that's before any other factors.

[skipmac]

Originally Posted by BandB

The point is that he doesn't qualify for the exemption if he hasn't paid tax in another state.

'


Sorry but that is not correct. Go read the regulations on the state web sites.

It is correct that if you pay sales tax on a boat in another state that FL will credit you for that amount against any sales tax you are liable for in FL if any. The reason for that is FL doesn't want to double tax boats.

However, whether or not you owe or pay sales tax in another state has nothing to do with whether or not you are exempt or not from paying FL sales tax. To say otherwise would be like saying you could be charged in Texas for smoking pot in Arizona. It doesn't work that way.

FL has very specific regulations about sales tax on boats and the ONLY reference to another state is the credit mentioned previously. I kept my boat and registered my boat in RI where there is no sales tax on used boats. I confirmed with the state of FL speaking directly with the FL Dept of Revenue and the FL FWC that I was exempt from FL sales tax. Basically their only concern is whether you If you think otherwise please post a link or quote the regulations that show it to be so.

[navy davy]

If you sell the boat the sale may not go through if you don't have proof of sales tax paid when you bought it, therefore you may have to come up with the sales tax then , it happened to me before 😏

[BandB]

Originally Posted by skipmac

'


FL has very specific regulations about sales tax on boats and the ONLY reference to another state is the credit mentioned previously. I kept my boat and registered my boat in RI where there is no sales tax on used boats. I confirmed with the state of FL speaking directly with the FL Dept of Revenue and the FL FWC that I was exempt from FL sales tax. Basically their only concern is whether you If you think otherwise please post a link or quote the regulations that show it to be so.

Were you a resident of FL when you purchased your boat initially? It's my understanding that changes the equation as Tom posted in post #18 and as an acquaintance of mine experienced. However, I don't find it detailed on the FL Revenue site.

[skipmac]

Originally Posted by BandB

Were you a resident of FL when you purchased your boat initially? It's my understanding that changes the equation as Tom posted in post #18 and as an acquaintance of mine experienced. However, I don't find it detailed on the FL Revenue site.

FL was my primary residence, so FL driver's license, registered to vote in FL working for a company based in CT I spent a lot of time in New England.

Since I purchased my boat nine years ago I hear the enforcement of the six month rule has become stricter but the rule has not changed. Essentially, if you purchase a boat outside the state of FL and legitimately USE the boat the boat outside of FL and can prove this to the satisfaction of the state of FL then you do not owe FL sales tax. Whether tax is due, paid or not paid in another state is not part of the FL regulation.

As noted, buying a boat and keeping it out of FL for six months and one day in storage, then moving it to FL for use doesn't qualify. Not sure exactly what will or will not qualify for legitimate usage but if the boat stays out of FL for a year or more, you own a home in the area where the boat is kept, live on the boat, cruising in that area or similar usage should do it.

The point that surprised me which I confirmed by another call to the FL FWC is even non US citizens that buy a boat in FL are subject to FL sales tax if the boat stays in the state.

[skipmac]

Originally Posted by navy davy

If you sell the boat the sale may not go through if you don't have proof of sales tax paid when you bought it, therefore you may have to come up with the sales tax then , it happened to me before 😏

What state? I've purchased at least 5-6 boats in FL over the years and the issue of sales tax paid by the previous owner never came up. The only thing FL cared about was seeing a valid title or USCG documentation and getting the tax from me for the current transaction.

[Larry Florida]

Originally Posted by skipmac

Since you have owned the boat for 16 months you should be fine, as long as you can document that the boat was kept and used in NY.

This comment seems to be true for non FL residents.
The wrinkle is, giving the identical circumstances, it is not absolutely clear if Florida residents will be taxed or not.

Have you actually registered a boat as a Florida resident and not been charged Tax?