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Old 09-07-2016, 20:35   #1
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Buying a boat and bringing back to Texas

Hey all,

I am looking at purchasing a boat down in the BVI and now I'm trying to figure out the whole tax thing.

It is a USCG registered boat and is registered as home port of Houston, TX.

We currently live in Houston and would like to bring the boat back to Houston.

I'm looking for ideas on how to minimize the tax impacts. Anyone have any ideas?

Thanks!

Jason
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Old 09-07-2016, 21:39   #2
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Re: Buying a boat and bringing back to Texas

Was sales tax ever paid in Texas, or anywhere else? If not Texas may way you to pay sales tax. Used to be the case in Texas. You should discuss Texas authorities to confirm current law.
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Old 10-07-2016, 02:36   #3
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Re: Buying a boat and bringing back to Texas

Ditto what Belize said.

We bought our boat in Mexico and brought it to TX. We had to pay the taxes when we registered the boat in Texas. I know of no legal way to avoid or reduce these taxes.

One suggestion - if there is a dinghy and outboard involved, you will need a bill of sale for each of these to register them in Texas. If you only have one bill of sale, make sure it specifically lists the dinghy and motor. I think a separate bill of sale will make registration of the dinghy and outboard simpler.

Cheers!

Steve
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Old 10-07-2016, 07:41   #4
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Re: Buying a boat and bringing back to Texas

They tried to get me too when we were in Texas for about a year. The boat was bought legally tax exempt in Florida...that confused them...before they sorted it out we were gone. IIRC, if boat is in Texas waters over 90 days then the tax man may come calling.

See if you can find proof of sales tax paid in another venue. That may help as I think the law is worded that if you can't prove sales tax payment in another venue then its due in Texas.

Texas Parks and Wildlife was (is?) in charge of boat registration and taxes.

Despite being Federally registered, you will also have to register in Texas...and then the sales tax question will come up. TPW officials also sweep thru marinas periodically looking for unregistered boats, and on the water too.

Given the likely amount of dollars, may be worth engaging an attorney knowledgeable in this area of Texas law. Thieving officials tend to opt for softer targets when you have your ducks in a row and professional representation (former multi-State business owner...stopped a lot of fishing expeditions this way).
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Old 10-07-2016, 09:38   #5
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Re: Buying a boat and bringing back to Texas

You live in Texas and register it with USCG and in Texas (with parks and wildlife) you will have to pay the tax, 6.25%.
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Old 10-07-2016, 10:03   #6
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Re: Buying a boat and bringing back to Texas

Remember that you are dealing with 2 different taxes. Sales tax and property tax. I bought a boat out of the country and my home state kept trying to get me to pay property tax, but since I didnt bring the boat back to Calif. I was exempt. By purchasing offshore, and staying out of the state for 6 months I didnt have to pay state sales tax even though I registered it in Calif. Texas may have a different set of rules, since state sales tax is just that. It is not a federal tax. Talk (ask for the codes) to what ever agency registers boats and find out if there is a difference in sales tax if the boat doesnt return to Texas for a period of time. Just my 2 cents worth. ___Grant.
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Old 10-07-2016, 12:13   #7
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Re: Buying a boat and bringing back to Texas

Texas you will pay 6.25%. Many States got smart on this and hire outside companies to do the research who get a percentage of money they find. California is notorious for going after people. The stories I have heard are not like another poster, once they bill you, you have to physically go there and state your case otherwise the bill will continue to rack up penalties and interest and stay on your credit indefinitely until paid.

Texas is getting smarter as well as Florida and other states. You will have to lie on the application or pay the taxes. Lying on the application is a criminal offense. They charge interest and a penalty of .05 after increments of time. It is clearly stated on the TWPD website what you are responsible for.

So, if your plan is to call Texas home, factor in the 6.25% and be done with it.
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Old 10-07-2016, 12:22   #8
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Re: Buying a boat and bringing back to Texas

Better Texas than California! Try 10% sales tax plus personal use tax every year. Gotta get the $ to pay the welfare bums somehow... Phil
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Old 10-07-2016, 12:55   #9
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Re: Buying a boat and bringing back to Texas

You do not have to pay sales tax if you are moving to Texas with your boat as a new resident. If you move out of Texas for some period of time, and then move back to Texas with a boat, you're a "new Texas resident". Instead of sales tax, you pay a $15 new resident fee to get the registration changed to Texas.

Texas will accept any of the following items as proof of out of state residency.

1. A out of state registration in your name.

2. A bill of sale, and proof that you were an out of state resident like a utility bill or government issued ID from out of state for the same date.

3. Proof of paying out of state sales taxes equivalent to the Texas sales tax.

Please note the .pdf published by the Texas Parks and Wildlife Department.

http://tpwd.texas.gov/fishboat/boat/...%20Vessels.pdf

It may be worth your time to move to a state without sales tax for a period of time, get the vessel registered with that state, and then move back to Texas. One thing to note is that the boat doesn't actually have to be in a given state to apply for that state's registration.

In my case, I ended up moving to Oregon, as that was were my boat was, and it needed a refit, so I needed to spend more than the 30 days you are granted for a traveling boat in Oregon. Oregon doesn't have a sales tax, and it's boat registration requirements are quite reasonable, and can be done strictly on the computer.
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Old 10-07-2016, 12:58   #10
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Re: Buying a boat and bringing back to Texas

When I bought my boat in Antigua I documented it in California. A few months later I got a bill from the state franchise tax board for sales tax. I mailed them copies of the sales agreement and my harbor entrance papers for Antigua, and stated that I would not be bringing the boat back to California for several years. It took a few other letters, but I was within the law, so they dropped the issue. I went through the same routine with the property tax accessor of the county that I documented it in. Again, I was within the law, and they backed off. You will never get out of property tax if your vessel is in a state longer than what that states limits are. I suspect that each state has different rules on sales tax, depending on how long you have owned it before it actually enters the state. That is why I said to get (and know) the codes (laws) that pertain to your situation. If there are legal exemptions , use them. If you are trying to scam the tax man, then Good F&%$*^% Luck. We all hate taxes, but I hate legal problems even more._____Grant.
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Old 10-07-2016, 13:38   #11
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Re: Buying a boat and bringing back to Texas

Just a quick note on USCG documentation. There was a time a few years back when vessel documentation was an official substitute for vessel registration in the 50 U.S. states. That has changed somewhat. While your 'documentation' is recognized in TX, it no longer excuses you from paying a different kind of fee every two years called a "Certificate of Number for a Vessel." So, if you don't plan on sailing much in offshore, foreign waters you may save some $$$ by skipping the updated USCG documentation in your name for new boat and just bow to the local / state authorities instead,, especially in Texas where we have, as you probably know, a pretty good Parks and Wildlife Dept. Cheers, Pappy
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Old 10-07-2016, 13:50   #12
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Re: Buying a boat and bringing back to Texas

Quote:
Originally Posted by ViribusUnitis View Post
You do not have to pay sales tax if you are moving to Texas with your boat as a new resident. If you move out of Texas for some period of time, and then move back to Texas with a boat, you're a "new Texas resident". Instead of sales tax, you pay a $15 new resident fee to get the registration changed to Texas.

Texas will accept any of the following items as proof of out of state residency.

1. A out of state registration in your name.

2. A bill of sale, and proof that you were an out of state resident like a utility bill or government issued ID from out of state for the same date.

3. Proof of paying out of state sales taxes equivalent to the Texas sales tax.

Please note the .pdf published by the Texas Parks and Wildlife Department.

http://tpwd.texas.gov/fishboat/boat/...%20Vessels.pdf

It may be worth your time to move to a state without sales tax for a period of time, get the vessel registered with that state, and then move back to Texas. One thing to note is that the boat doesn't actually have to be in a given state to apply for that state's registration.

In my case, I ended up moving to Oregon, as that was were my boat was, and it needed a refit, so I needed to spend more than the 30 days you are granted for a traveling boat in Oregon. Oregon doesn't have a sales tax, and it's boat registration requirements are quite reasonable, and can be done strictly on the computer.

This is what happens when people do not read what the OP is asking.


1. They LIVE in houston

2. They want to buy a boat somewhere else and bring it back to Houston regardless of where that boat happens to be or currently registered. A dealer would not collect sales tax, it is up to the buyer to pay it in their home state where they will register it. CG Documentation does not matter to the State of Texas, you will still register it with TWPD. You still have to display the TWPD sticker, but are not required to display the TX numbers.

3. You pay tax in your home state. TEXAS.

The OP will have to pay texas sales tax of 6.25% period. Any other advise is plain wrong.
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Old 10-07-2016, 15:00   #13
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Re: Buying a boat and bringing back to Texas

Quote:
Originally Posted by tdoster View Post

This is what happens when people do not read what the OP is asking.


1. They LIVE in houston

2. They want to buy a boat somewhere else and bring it back to Houston regardless of where that boat happens to be or currently registered. A dealer would not collect sales tax, it is up to the buyer to pay it in their home state where they will register it. CG Documentation does not matter to the State of Texas, you will still register it with TWPD. You still have to display the TWPD sticker, but are not required to display the TX numbers.

3. You pay tax in your home state. TEXAS.

The OP will have to pay texas sales tax of 6.25% period. Any other advise is plain wrong.
Exactly correct.
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Old 11-07-2016, 04:41   #14
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Re: Buying a boat and bringing back to Texas

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Originally Posted by gjordan View Post
When I bought my boat in Antigua I documented it in California. A few months later I got a bill from the state franchise tax board for sales tax. I mailed them copies of the sales agreement and my harbor entrance papers for Antigua, and stated that I would not be bringing the boat back to California for several years. It took a few other letters, but I was within the law, so they dropped the issue. I went through the same routine with the property tax accessor of the county that I documented it in. Again, I was within the law, and they backed off. You will never get out of property tax if your vessel is in a state longer than what that states limits are. I suspect that each state has different rules on sales tax, depending on how long you have owned it before it actually enters the state. That is why I said to get (and know) the codes (laws) that pertain to your situation. If there are legal exemptions , use them. If you are trying to scam the tax man, then Good F&%$*^% Luck. We all hate taxes, but I hate legal problems even more._____Grant.
Hi Grant

Just to clarify - you have to pay property tax yearly on top of the sales tax in California?

I'm originally from Santa Cruz, but have lived in Australia the last 35 years and now have dual citizenship. My plans were to sail back to California and spend a few years in SC. That would make me liable for both sales tax and property tax? Ouch!

John
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Old 11-07-2016, 04:58   #15
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Re: Buying a boat and bringing back to Texas

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