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Old 17-03-2009, 16:41   #16
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Rich,

Call the California Board of Equalization and they will send you the booklet of rules. After you read the rules call 2 or 3 different Board of Equalization offices and ask to talk to an auditor so you can get clarification and ask questions. The delivery site itself and the daily documentation is what really counts. Even California residents used to be able to do this so again call the Board of Equalization.

The rules for a motorhome were: take delivery out of state, do NOT for any reason bring the motorhome into CA for 91 days, make a record of where you took delivery (have a notary present to sign attesting to the delivery site), and keep a very detailed record as to where you were every day of the 91 days. For a while they switched it to 181 days but then went back to 91 days.

I have two friends that did the same with their boats and they told me it's still possible so call the California board of equalization to see if it's still possible and get the CURRENT rules for boats.
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Old 17-03-2009, 16:47   #17
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Rich,

Call the California Board of Equalization and they will send you the booklet of rules. After you read the rules call 2 or 3 different Board of Equalization offices and ask to talk to an auditor so you can get clarification and ask questions. The delivery site itself and the daily documentation is what really counts. Even California residents used to be able to do this so again call the Board of Equalization.

The rules for a motorhome were: take delivery out of state, do NOT for any reason bring the motorhome into CA for 91 days, make a record of where you took delivery (have a notary present to sign attesting to the delivery site), and keep a very detailed record as to where you were every day of the 91 days. For a while they switched it to 181 days but then went back to 91 days.

I have two friends that did the same with their boats and they told me it's still possible so call the California board of equalization to see if it's still possible and get the CURRENT rules for boats.
BTW, this pretty much only works for CA residents because when you take your boat to your home state they will charge you the sales (use) tax although if your home state's tax is less you do make out.
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Old 17-03-2009, 18:15   #18
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There are actually two kinds of taxes applied to boats in Kaliforniastan.

1) When the boat is sold, the state collect a use tax or sales tax equal to the sales tax rate in the county & city where the boat was sold. This use/sales tax paid once when the boat is sold, paid again if the boat is sold again, etc. Where I live, the rate is 8.75%. This is the tax you avoid by taking offshore delivery. BTW, the new budget just passed turns the 90 day yacht club into the 365 day yacht club. Yes, the Kalifornicators in Sacratorment lengthened the time to stay out of state to avoid the tax to 1 year.

2) The other tax levied is personal property tax. This tax is 1.1% of the assessed value of the boat as determined by sales price, BUC, NADA, and other boat sales pricing sources. This tax is levied by the county where the boat was berthed as of January 1st of each year. Even if you sold the boat on January 2nd, you will get a bill in August for the yearly property tax. Usually, the sales agreement splits the cost between the buyer & seller on a prorated basis but some brokers don't bother... thus the surprise for someone in August. As long as the county thinks the boat is in their county, a tax bill will be generated and sent to the last owner on record. Make sure you can prove when the boat was taken out of state so you can fight the January 1st assessment. Oh yeah, when notified that you have moved the boat out of their county to another California county, the original county will notify the new county that the boat has moved.

On my 42' boat the personal property tax is about $1300 per year. When I bought the boat, I made an appointment with the county assessor and we agreed to an assessed value considerably less than their initial value.

Hope that helps.
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Old 17-03-2009, 19:43   #19
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You must receive the boat offshore (beyond the 3 mile limit). Put the lat/long of the delivery location in the sales agreement. Then, went delivery day comes, the current owner sails the boat to the delivery location, and hands you the keys. You have now completed an offshore delivery. You can return to California (to drop off the previous owner, if nothing else ;-) but you must leave the state within 90 days.
I believe the allowable time within California waters is actually 25 hours, not 90 days. You might want to read through this thread:

US Sales Tax and Mexico

I note that member Stevens 47 mentions in that thread that he is a California yacht broker and invited the OP to PM him for detailed instructions on the procedure. A short note to him couldn't hurt.

Also worth reading is this item from The Log of October 2, 2008:

http://www.thelog.com/askAttorney/as...ney.aspx?x=191

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Old 17-03-2009, 21:36   #20
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as a general rule...

...my annual tax here in CA is about the same as my annual insurance bill.

The more your boat is worth, the more you pay. Seems fair. Liveaboard boaters ought to pay as much of a fireman's salary as homeowners. I've found the assessors in Marin and San Mateo counties to be quite reasonable about estimating the real value of a boat.
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Old 17-03-2009, 23:02   #21
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YOUR FRIENDLY NEIGHBOURHOOD CANUCK.

We just bought our boat in Long Beach in January. Being Canadian we went 3 1/2 miles off shore for an offshore delivery, also got the "declaration of offshore delivery" form from the state of California. We avoided the state tax.

As I understand it...The state of California's DMV licensing collects their tax money when you go into the DMV with the pink slip, so if you are a resident of another state, don't visit the DMV in California. Oregon has no state tax as another post indicates.

The annual USER TAX is different from the DMV tax collection. Whomever owns the boat as of JAN 1 of the year PAYS THE TAX. We did our home work and agreed to take possession on January 5th. As it turned out the previous owner was having to pay the tax of about $400 on a boat he no longer owned for this year.

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Old 18-03-2009, 23:06   #22
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Also worth reading is this item from The Log of October 2, 2008:

Ask Attorney

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"The one significant exception to the one-year timetable allows an owner to keep the boat in California during a repair, retrofit or modification project without affecting the one-year analysis, as long as the boat logs less than 25 hours under way while it is in California."

Might be tricky to prove, but I know a lot of people who's boat is always under repair, retrofit or modification....and lots of people that log less that 25 hours underway....especially if it really means "underway in california" and once you are 3 miles offshore you are not in CA. Boat projects have a special way of taking forever, even more so than house projects ;-)

I'm curious if anyone has pushed the boundaries of that loop whole, were taxed, and won on appeal. It's certainly important to the local boating industry that people can get there work done in the state before heading to Mexico for the intended use.
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Old 19-03-2009, 00:42   #23
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Might be tricky to prove, but I know a lot of people who's boat is always under repair, retrofit or modification....and lots of people that log less that 25 hours underway....especially if it really means "underway in california" and once you are 3 miles offshore you are not in CA. Boat projects have a special way of taking forever, even more so than house projects ;-)
If the vessel is on the hard, repair, retrofit or modification is relatively easy to prove, and it would be pretty obvious, as well, that the vessel has not been underway more than 25 hours in California waters. The problem arises if you choose to keep the vessel in a slip while these "repairs" are being made.

To my mind, the description of a vessel as constantly under repair, retrofit or modification and accumulating less than 25 hours underway in state waters is also a description of a "dock queen." If that's all a vessel is, why bother?

The tax authorities have a lot of "eyes" watching the marinas, so they have a pretty clear idea of what is actually going on. You might claim that you took the vessel outside the three mile limit to sea trial her and test the repairs, but it won't take many trips outside and back to eat up the 25 hour restriction.

The bottom line is that they know when someone is trying to pull a fast one and skirt the regs - and they are likely to resent it. Chances are good that they will dun you for taxes, penalties and interest, and you will be forced to appeal their decisions in, essentially, "their" system. Talk about home-field advantage . . .

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Old 20-03-2009, 20:49   #24
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well if you mean the unsecured property tax it's 1% of the value per year $100,000.00 boat will get you a bill for 1,000.00 and will go down as the boat gets older and becomes worth less payable to the town where the boat is kept.
its payable by the person who owned her at the end of June.
sales tax is another thing selling price and that depends on where the boat is sold or where you live any where 7.5% to 9% of the sales price.
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