Title and Documentation Companies

sail2wind · 17-10-2009, 17:53

We are very close to purchasing a sailboat in the BVI. How important is it to use a T & D company? BVI Yacht Sales recommends ASAP in Ft Lauderdale. We live in Colorado, where should it be registered? We see so many boats with Delaware or St.Thomas on the stern.

barefoot life · 17-10-2009, 19:08

We used ASAP for a recent purchase of a new Beneteau. They came recommended by several folks. Apparently, they have a good reputation. The service we received was great. They helped with both the coast guard documents and the LLC to cover the boat.

Reality Check · 17-10-2009, 19:18

Although I do not have the paperwork, I'll bet I also use the same service and had good results. I also purchased via BVI Yacht sales and they had great service. Heck, they even have some photos of me in their marketing brochures!!! I look a lot like Brad Pit.... well maybe not

BVI Yacht Sales is a good group of sailors... lots of knowledge and located at Nanny Cay

kiapa · 17-10-2009, 19:39

sail2wind, congrats on your new boat.
first decision is whether or not you will register your boat with a specific state, document your new boat in the good old USA, or register it with a foreign country. if you will use your boat for any int'l cruising, it should be documented as opposed to state registered.
if you go the u.s. documentation route, you need a hailing port in the USA. i can't see why you wouldn't want to use "hometown", Colorado... especially if that's the address you'd use on your documentation.
while many folks use firms (and pay big bucks) for documentation services, you can do this yourself pretty easily. there are a few forms to fill out and one modest fee to pay. the coast guard vessel documentation service in west virginia is very easy to deal with, and very supportive. check 'em out online at USCG National Vessel Documentation Center, Home Page
good sailing...

sail2wind · 17-10-2009, 22:04

I have been told registering in Colorado might have some tax ramifications, and open up doors not meant to be open. USVI seems to be a very popular registration area. Anyone know how much these D & T companies charge on a 43' Beneteau Moorings Mono. The survey is the easy part.

barefoot life · 18-10-2009, 08:38

Our boat is registered in Deleware, where the LLC was formed. From what I determined from my research, most boat LLCs (and many other companies) form in Deleware. No negative tax implications. I think that is why you see so many boats hailing from Deleware. I do not know about St. Thomas. On the boat, we show the hailing port as Spokane, WA (our land based home). ASAP charged us $650 for all of the boat related documentation. LLC formation was an additional charge. I work in a heavy regulated profession, lots of forms to State and Federal agencies. I would recommend against doing it yourself - a single mistake will need to be corrected and your paperwork will be sent to the bottom of the pile. It is definately worth paying someone that knows what they are doing.

bmiller · 18-10-2009, 08:54

Quote:

Originally Posted by sail2wind

I have been told registering in Colorado might have some tax ramifications, and open up doors not meant to be open.

Like what? This is of interest to us since we also live in CO and are looking at boats on the east coast. I thought registering in CO would save some cash since the registration is only $35 or so here.

Where in the state are you?

donradcliffe · 18-10-2009, 09:22

The USCG documentation center will eventually notify the state you register as your home port that you have bought the boat. Many states will be coming after you for sales or use tax on purchase. Check with CO about their policy, or search this forum for more information, like

Sales / Use Tax Enforcement on East Coast

sail2wind · 18-10-2009, 11:26

Bmiller, We live in Grand Junction. We are going to talk to our accountant, doubt he has any idea of boat registration procedures. We are also talking to ASAP on Monday. Sales tax in Colorado is 8% big chunk on 150K, since the boat is not purchased in Co., really don't know how thay can chase you for sales tax.

bmiller · 18-10-2009, 15:20

Keep us posted on how it goes.

kiapa · 23-10-2009, 09:22

there are a number of very different tax & licensing questions implicitly bouncing around in this thread -- "ownership" (individual vs corporation/LLC), "sales & use tax", "import duty", and registration entity (foreign gov't, USA, state). there is some complexity, and there are $ at stake. there are also alot of folks out there that will hide behind this complexity with the idea of collecting (not very hard-earned) fees from you.

some opinions based on our experience with 4 boats owned in two different countries, two different states, with titles held by corporation, joint tenants, and in a "trust". everyone's situation is different, so these opinions might not work for you...

if boat is going to be kept in the caribbean (no plans for usa visits), then foreign title is fine. if boat is to be kept in the usa... or is to be world cruised by a US passport holder, there are advantages to USA documentation. i don't know the latest, but this presumably requires "importing" the boat, and involves paying duty... but duty rates on used sailboats aren't that very high. there is some chance that you could document it now, and not pay duty until it physically is taken into the usa, i just don't know the latest on this.

if a boat is documented, yes indeed the states have access to the registration info. but, from our experience, the state (e.g. colorado) can't charge a resident sales or use tax on a boat (or other asset) that does not enter the state.

there are lots of folks who advocate "corporate" ownership to avoid paying sales & use tax. many states have worked around this. the corporate ownership gig requires paying annual fees to the registering state... and often lawyer fees as well. our experience (with a CA boat purchase and an OR corporation) was that this was a nuissance, and didn't help us in any way with fees & taxes.

all this is definitely worth checking out... but watch out for eager "helpers".

kiapa · 23-10-2009, 10:06

... and not directly alluded to, there are property taxes. these tend to have more to do with where a boat is "permanently" moored, and not registration. all this is a great reason to just shove off and go cruising.

osirissail · 25-10-2009, 20:18

- - As a USA citizen traveling to foreign countries in a vessel - USCG documentation is the way to go unless you set up an offshore Corp or LLC in an offshore country and document the boat there. Normally the hassles, fees, and recurring costs only make this worth the money if you have a mega-buck yacht.
- - Many retired, full time cruisers research and find a US State with minimal registration boat costs and minimal personal taxing costs and then move all their "address of record" to there. This includes drivers licenses, cars, IRS address, retirements, insurance, etc. Everything needs to be coordinated to the same taxing jurisdiction to avoid claims by other jurisdictions that you are engaging in tax fraud. Under the K.I.S.S. principle coordinating everything to a single location is worth it. Of course, if you have a home, kids in school, etc., etc., you choices are limited to your real home state or an offshore corp/LLC. Hassling for years with the IRS or State's tax division is just not worth the few thousands you think you might save but will spend later in tax lawyers and fines and fraud penalties not to mention appearances and auditing of all your past records. That can of worms is just not worth opening. Keep it simple or go the offshore route (which is not really simple).

17-10-2009, 17:53	#1
sail2wind Registered User Join Date: Jan 2007 Posts: 80	Title and Documentation Companies We are very close to purchasing a sailboat in the BVI. How important is it to use a T & D company? BVI Yacht Sales recommends ASAP in Ft Lauderdale. We live in Colorado, where should it be registered? We see so many boats with Delaware or St.Thomas on the stern.

17-10-2009, 19:18	#3
Reality Check Registered User Join Date: Jun 2007 Location: West Indies, Now live aboard as cruiser/ voyager often with guest/ friends Boat: s/v Reality Check 36' Bene Posts: 491	Although I do not have the paperwork, I'll bet I also use the same service and had good results. I also purchased via BVI Yacht sales and they had great service. Heck, they even have some photos of me in their marketing brochures!!! I look a lot like Brad Pit.... well maybe not BVI Yacht Sales is a good group of sailors... lots of knowledge and located at Nanny Cay __________________ I prefer a sailboat to a motorboat, and it is my belief that boat sailing is a finer, more difficult, and sturdier art than running a motor. --- Jack London

18-10-2009, 15:20	#10
bmiller Registered User Join Date: Mar 2006 Location: Buena Vista Colorado Boat: S/V Pooka Com-Pac 27 Posts: 195	Keep us posted on how it goes. __________________ S/V Pooka Com-Pac 27

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17-10-2009, 19:08	#2
barefoot life Registered User Join Date: Oct 2009 Location: Spokane, WA Boat: Beneteau 43 - Barefoot Life Posts: 7	We used ASAP for a recent purchase of a new Beneteau. They came recommended by several folks. Apparently, they have a good reputation. The service we received was great. They helped with both the coast guard documents and the LLC to cover the boat.

17-10-2009, 19:39	#4
kiapa Registered User Join Date: Sep 2009 Boat: M&M 52, Kiapa Posts: 59	sail2wind, congrats on your new boat. first decision is whether or not you will register your boat with a specific state, document your new boat in the good old USA, or register it with a foreign country. if you will use your boat for any int'l cruising, it should be documented as opposed to state registered. if you go the u.s. documentation route, you need a hailing port in the USA. i can't see why you wouldn't want to use "hometown", Colorado... especially if that's the address you'd use on your documentation. while many folks use firms (and pay big bucks) for documentation services, you can do this yourself pretty easily. there are a few forms to fill out and one modest fee to pay. the coast guard vessel documentation service in west virginia is very easy to deal with, and very supportive. check 'em out online at USCG National Vessel Documentation Center, Home Page good sailing...

17-10-2009, 22:04	#5
sail2wind Registered User Join Date: Jan 2007 Posts: 80	I have been told registering in Colorado might have some tax ramifications, and open up doors not meant to be open. USVI seems to be a very popular registration area. Anyone know how much these D & T companies charge on a 43' Beneteau Moorings Mono. The survey is the easy part.

18-10-2009, 08:38	#6
barefoot life Registered User Join Date: Oct 2009 Location: Spokane, WA Boat: Beneteau 43 - Barefoot Life Posts: 7	Our boat is registered in Deleware, where the LLC was formed. From what I determined from my research, most boat LLCs (and many other companies) form in Deleware. No negative tax implications. I think that is why you see so many boats hailing from Deleware. I do not know about St. Thomas. On the boat, we show the hailing port as Spokane, WA (our land based home). ASAP charged us $650 for all of the boat related documentation. LLC formation was an additional charge. I work in a heavy regulated profession, lots of forms to State and Federal agencies. I would recommend against doing it yourself - a single mistake will need to be corrected and your paperwork will be sent to the bottom of the pile. It is definately worth paying someone that knows what they are doing.

18-10-2009, 09:22	#8
donradcliffe Registered User Join Date: Mar 2007 Location: Caribbean for the winter Boat: Beneteau First 456 Posts: 722	The USCG documentation center will eventually notify the state you register as your home port that you have bought the boat. Many states will be coming after you for sales or use tax on purchase. Check with CO about their policy, or search this forum for more information, like Sales / Use Tax Enforcement on East Coast

18-10-2009, 11:26	#9
sail2wind Registered User Join Date: Jan 2007 Posts: 80	Bmiller, We live in Grand Junction. We are going to talk to our accountant, doubt he has any idea of boat registration procedures. We are also talking to ASAP on Monday. Sales tax in Colorado is 8% big chunk on 150K, since the boat is not purchased in Co., really don't know how thay can chase you for sales tax.

23-10-2009, 09:22	#11
kiapa Registered User Join Date: Sep 2009 Boat: M&M 52, Kiapa Posts: 59	there are a number of very different tax & licensing questions implicitly bouncing around in this thread -- "ownership" (individual vs corporation/LLC), "sales & use tax", "import duty", and registration entity (foreign gov't, USA, state). there is some complexity, and there are $ at stake. there are also alot of folks out there that will hide behind this complexity with the idea of collecting (not very hard-earned) fees from you. some opinions based on our experience with 4 boats owned in two different countries, two different states, with titles held by corporation, joint tenants, and in a "trust". everyone's situation is different, so these opinions might not work for you... if boat is going to be kept in the caribbean (no plans for usa visits), then foreign title is fine. if boat is to be kept in the usa... or is to be world cruised by a US passport holder, there are advantages to USA documentation. i don't know the latest, but this presumably requires "importing" the boat, and involves paying duty... but duty rates on used sailboats aren't that very high. there is some chance that you could document it now, and not pay duty until it physically is taken into the usa, i just don't know the latest on this. if a boat is documented, yes indeed the states have access to the registration info. but, from our experience, the state (e.g. colorado) can't charge a resident sales or use tax on a boat (or other asset) that does not enter the state. there are lots of folks who advocate "corporate" ownership to avoid paying sales & use tax. many states have worked around this. the corporate ownership gig requires paying annual fees to the registering state... and often lawyer fees as well. our experience (with a CA boat purchase and an OR corporation) was that this was a nuissance, and didn't help us in any way with fees & taxes. all this is definitely worth checking out... but watch out for eager "helpers".

23-10-2009, 10:06	#12
kiapa Registered User Join Date: Sep 2009 Boat: M&M 52, Kiapa Posts: 59	... and not directly alluded to, there are property taxes. these tend to have more to do with where a boat is "permanently" moored, and not registration. all this is a great reason to just shove off and go cruising.

25-10-2009, 20:18	#13
osirissail Registered User Join Date: Feb 2009 Location: onboard in the Caribbean - mostly in Grenada Boat: Gulfstar 53 - Osiris Posts: 1,067	- - As a USA citizen traveling to foreign countries in a vessel - USCG documentation is the way to go unless you set up an offshore Corp or LLC in an offshore country and document the boat there. Normally the hassles, fees, and recurring costs only make this worth the money if you have a mega-buck yacht. - - Many retired, full time cruisers research and find a US State with minimal registration boat costs and minimal personal taxing costs and then move all their "address of record" to there. This includes drivers licenses, cars, IRS address, retirements, insurance, etc. Everything needs to be coordinated to the same taxing jurisdiction to avoid claims by other jurisdictions that you are engaging in tax fraud. Under the K.I.S.S. principle coordinating everything to a single location is worth it. Of course, if you have a home, kids in school, etc., etc., you choices are limited to your real home state or an offshore corp/LLC. Hassling for years with the IRS or State's tax division is just not worth the few thousands you think you might save but will spend later in tax lawyers and fines and fraud penalties not to mention appearances and auditing of all your past records. That can of worms is just not worth opening. Keep it simple or go the offshore route (which is not really simple).