Sales use Tax HELP!!!

[Dhillen]

Originally Posted by roverhi

Believe the tax people use March as the date of record for owing taxes. If you are in a slip at that time, you'll get dinged for the tax. Not sure about boat yards but we got hit for the tax in a do it yourself boatyard on a vacant lot in Costa Mesa many years ago. The marina's are required to report whose there. The California Tax authorities make the Stasi look like a Boy Scouts. If you bought the boat in WA, you should have paid the tax there so they will credit you with that tax paid. Other than that, you'll owe saies tax over and above the differential between CA and WA tax. The Counties also assess a use tax annually but it's not nearly as onerous as their sales tax.

People must really love the weather in CA. If you make any real money there, the State and Fed's will get you for 50% of your income not including the 15.3% FICA tax on the first $113.000.

We left California 8 years ago and I swore I'd never go back. Having grown up there it was amazing to see the ******* per capita ratio skyrocket on a yearly basis until living in the "Golden State" became intolerable.

We now live in Washington and locals always discount us if we say "We're from California!" you can actually see people physically take a step backward! Obviously, I don't make that proud boast anymore....

Speaking from personal experience with the CA state tax authorities; they will chase you like the hounds of hell they are until the ends of the earth are reached.

Pay up and shut up.

Good luck.

Dhillen

[MarkSF]

Originally Posted by roverhi

Believe the tax people use March as the date of record for owing taxes. If you are in a slip at that time, you'll get dinged for the tax. Not sure about boat yards but we got hit for the tax in a do it yourself boatyard on a vacant lot in Costa Mesa many years ago. The marina's are required to report whose there. The California Tax authorities make the Stasi look like a Boy Scouts. If you bought the boat in WA, you should have paid the tax there so they will credit you with that tax paid. Other than that, you'll owe saies tax over and above the differential between CA and WA tax. The Counties also assess a use tax annually but it's not nearly as onerous as their sales tax.

People must really love the weather in CA. If you make any real money there, the State and Fed's will get you for 50% of your income not including the 15.3% FICA tax on the first $113.000.

The counties assess property tax annually, which is about 1% of the value (usually more like 1.2%).

Sales and use tax are assessed by the Board of Equalisation (BOE), a state entity.

I just calculated my tax rate, living in CA, it is 35%. By that I mean I take home 65% of my pay. Higher than I'd like but a lot lower than 50%.

[avb3]

Reading all of this makes the term, "California is a nice place to visit but I would not want to live there" have some meaning.

I'm one of those Canadian snowbirds. There is no one I am aware of that snowbirds to California. Prices and taxes are the reasons. Instead, Arizona, and Florida are the primary USA destinations, with Mexico being right in there also. From our perspective, inexpensive and in my case, Florida has a excellent sailing infrastructure. (Can't sail in the desert).

Florida's taxes I find reasonable, both on property, and on the boat. Others may disagree, but I doubt anyone will disagree that California has been overboard on taxes for many, many decades.

[brantleychuck]

Originally Posted by a64pilot

I have a major issue with property tax myself, I think its wrong plain and simple. I see it as having to continue to pay for something that I own, and that's not right.

But, you got caught plain and simple, they are going to get their money. You are most likely like me, I make good money, but not enough to afford to pay tax attorneys etc. to keep me from paying taxes, because frankly the wealthy pay little if any in taxes.

I sold a boat and my airplane in Jan of this year, guess what, I still get to pay property taxes on both, even though I haven't seen either nor had use of them for the last ten months or so.

I bought our boat in FL, paid FL taxes and keep it in FL, with it registered in FL., Home port in Fl
My understanding is if Ga. finds out about it, I will owe Ga property taxes each year as I'm a Ga. resident

I think if you hadn't put your boats home port in California, you might have a more believable case, that won't help.

Why do you think the wealthy pay " little if any taxes". You really need to get informed on this matter. Open your mind and look at the facts.

In 2002 the latest year of available data, the top 5 percent of taxpayers paid more than one-half (53.8 percent) of all individual income taxes, but reported roughly one-third (30.6 percent) of income.





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[Greenhand]

I am not sure what all of the CA bashing is about. Most states have written their tax codes so that vessels and vehicles crossing state lines pay sales tax somewhere. They are even written so that you pay up to the highest level between the state you buy in and the state you settle in.

It does seem that CA is particularly aggressive, but it also seems that CA is particularly subject to "screw the man" mentality, as it has rural mountains for the cabin in the woods types, gorgeous beaches for the the surfer types and safe harbors for the sail off into the sunset types.

[a64pilot]

Originally Posted by brantleychuck

Why do you think the wealthy pay " little if any taxes". You really need to get informed on this matter. Open your mind and look at the facts.

In 2002 the latest year of available data, the top 5 percent of taxpayers paid more than one-half (53.8 percent) of all individual income taxes, but reported roughly one-third (30.6 percent) of income.





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I'm actually pretty close to that 5% myself, may well be there for all I know but am around a lot of people that make far more than I, but pay less tax.
Guy I work for is a good example, I know what he used to pay as my Brother was his CPA, the very wealthy have people that are very good at "gaming" the system and avoiding tax, my Brother was one of those, that was his specality.
I understand the stats, and am in agreement that people like me pay the majority of the tax, but people well above me, the ones with the private jets and homes in the Cayman's and Paris etc often do not pay the amount of taxes you believe.
I'm guessing they are the 1%? There is a point and I do not know what it is, where wealth just goes almost vertical when graphed, I do not know where that point is.

[Jon Neely]

Thanks for all the response, just to clear everything up we did in fact pay our property tax this year on the boat and alameda mud tax. Minus BOE hunting me down in cali if I ever return is their jurisdiction reach any further than CA. Can it conflict with the documentation? I am going to call the Documentation office on the east coast this morning and ask as well. We Where legally moored in CA for 11 months not 18. Counting our time here now we have been in CA for 13-14 months.


Cheers,

Jon

[Stu Jackson]

Go here: Latitude 38 - The West's Leading Sailing and Marine Magazine

Type in "property tax" in the search on Lat38 and read away.

You have two issues:

1. Last years tax. I agree that you should pay it, but your choice to fight it.

2. Your bigger issue is going to prove to the BOE that you've left. That is covered in the links you will find and read.

[NZGrant]

Bloody hell your tax systems sucks. We dont pay any sales tax on second hand boats but i think we do on new ( i am so far off ever buying new it doesnt matter ). We also have no tax to pay just because we own a boat.

Do you pay tax on your car or motor homes as well ?


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[Greenhand]

Originally Posted by NZGrant

Bloody hell your tax systems sucks. We dont pay any sales tax on second hand boats but i think we do on new ( i am so far off ever buying new it doesnt matter ). We also have no tax to pay just because we own a boat.

Do you pay tax on your car or motor homes as well ?


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Yes, all vehicles have sales tax in the vast majority of the US states. Some states also have yearly taxes, others have flat annual registration fees.

[avb3]

Florida has an interesting system for used boats, depending on whether you buy it through a broker or private.

If through a broker, you pay on the entire purchase price. However, and the State website endorses this, if you buy the accessories (detachable) separately, there is no tax on those.

From their website:

What is included in the price of a vessel and therefore subject to sales tax? ?

If a dealer makes the sale, then tax is due on the cost of the trailer, motor (outboard and inboard), vessel, and accessories. If a non-dealer makes the sale, then the outboard motor, equipment, devices, and accessories included with the vessel are not subject to tax when the outboard motor, equipment, devices, or accessories are separately itemized and separately priced on the invoice.

Sails, anchors, nav equipment, etc. etc. were listed separately when I bought my boat. There were no questions at the office on valuations.

I suspect California would not allow this.

[CarlF]

While I don't know California rules, Massachusetts has a similar "presumption" concept around boat sale tax. If I'm a resident of Massachusetts and bring a boat into Massachusetts for even a day during the first six months of ownership, there is a statutory presumption that I intended to use the boat in Massachusetts when I bought it. The burden is then on me to prove to the state that isn't the case. It's very hard to prove a negative. Particularly hard for you since you lived on the boat.

If I bring the boat into Massachusetts after six months, the burden then falls on the state to prove the intent at time of purchase. That's very difficult for the state too. Although they had luck with an idiotic owner who registered a Massachusetts mooring in the boat's name the same day he bought the boat

[Cheechako]

You lived aboard in CA for too long, "using the boat". Otherwise you would have been fine if you left within the 90 day period. Also it sounds like you documented the boat with a CA hailing port.. that wasn't too smart. You are screwed... either just leave and deal with it later or pay it.

[SVNeko]

Lots of info flying around here. As an ex-Calif resident I can state what we know. If you buy the boat outside Ca and don't bring it in for one year (don't know how exception for repairs works), then you pay no sales tax. After one year, bring it in and keep it there as long as you like - no sales tax.

Then to leave California, consider that most states also have a use tax, which is a sales tax in disguise. If you bring something into their state you pay a use tax on it, normally at the same rate as their sales tax. This usually has whatever sales tax you paid, even in another state, credited against it. So if you paid a lot of sales tax, you're probably OK. California residents who didn't pay sales tax will get hit in their new state unless there is some other exception. Exceptions vary from state to state. I think Florida says if you've owned your boat for 4 years, you pay no Fla use tax even if you paid less or no sales tax originally. They cap sales tax at $18,000 anyway, to attract the big yachts.

Then California also has this separate onerous yearly property tax which you pay if your boat is in the taxing county on Jan. 1. They also have a presumption that if your hailing port is in Ca you owe property tax on it, no matter where you are. If your boat is not in Ca, this is not too hard to get out of, but you have to document that it is somewhere else. We used foreign country entrance/zarpe papers and marina receipts and were fine. SF agreed to put it in our file to leave us alone - we'll see.

I don't think too many states have this recurring property tax on boats. There isn't really a good rationale for it other than a plain money grab. In our experience, Ca has lots and lots of little money grabs, which add up. Its one of the reasons we left, although we love the state's parks and outdoors and weather ... and some of the people.

[CarlF]

Found this surprisingly lucid (for a State document) description of Florida's rules. A boat bought in the US but not in Florida owes no sales tax or use tax as long as it doesn't enter Florida for six months after purchase. But a foreign purchased boat that is US flagged owes the use tax whenever it first enters Florida (less sales tax already paid).

http://dor.myflorida.com/dor/forms/current/gt800005.pdf