USCG Documented Vessel vs State Registration

[sophieoreo]

I'm nearing completion of a plans-built 29' sailing cutter, built in my yard over the past ** years which I will own and sail, the vessel being eventually housed at a local marina. I live in California. It appears that I have two choices with regard to (either) 'documenting' the boat or 'registering' the boat... Here's the verbiage from the California Dept of Motor Vehicles to the question 'Which Vessels Must Be Registered': "Generally, every sail-powered vessel over eight feet long and motor driven vessels not documented by the U.S. Coast Guard... " (italics are mine). This seems to say that if the vessel IS documented by the USCG, then you do not need to register it with the State of California... I'm thinking that if I go the 'registration' route, the State of CA will send me a tax bill based on cost of material used in the boat's construction (a $ figure they ask for on the registration form). On the other hand, if I 'document' the vessel with the USCG, there will be no tax bill (rather just the $133 due to the USCG for the documentation certificate). Lastly, since I've built the boat from plans, there is no 'hull identification number' - can I simply make one up? Any thoughts appreciated.

[Calif.Ted]

"Use" tax at same rate as "sales" tax is due at time of purchase for both, DMV collects on state registered boats. Purchaser of documented vessels is responsible to pay BOE, if you do not volunteer they will get to you eventually with interest and penalties.
Since there is no "purchase price" and you've paid sales tax on materials I don't have a clue, call BOE.
HIN numbers for homebuilt boats are normally assigned by the DMV, so you might start there anyway.

[anchorbend]

Can't answer your question re:taxation. As to registration, I suspect you will need to register your boat with California which is different than having a boat title. You can not have a title to a documented vessel per fed regs. Documentation would have an advantage if you are sailing in foreign waters or selling to a boat in another country. Some states do not title boats so documenting would help provide a chain of ownership.

[Calif.Ted]

California requires either state registration or documentation and will not allow both. To document a vessel you need to submit an "original not a copy" builders certificate, I don't think a home builder can do that.

https://www.dco.uscg.mil/Portals/9/DCO%20Documents/NVDC/CG1261%20Builder's_Certification.pdf?ver=2017-07-17-152803-220

[Calif.Ted]

I actually don't think you'll owe use tax because you didn't purchase the vessel.
Tax Guide for Purchasers of Vehicles, Vessels, & Aircraft

[Frank999]

Personally, I would go for documentation and leave the state out of it. It seems pretty obvious to me what you do about the Builder's Certificate: you complete it, as the builder. The form is at https://www.dco.uscg.mil/Portals/9/D...-17-152803-220. You can find a lot of information about documentation on the National Vessel Documantation Center's web site at https://www.dco.uscg.mil/Our-Organiz...tation-Center/.


Their phone number is 800-799-8362, and my experience getting answers to questions when I called was good. I suggest calling them with questions about how to document your boat.



Do be aware that when you apply for initial documentation of a recreational boat, they wait 90 days to take any action, and if there is anything that needs correcting, which will be likely for a DIY first-time documentation application, there will be another 90-day wait after you send in the corrections.

[svJasmine]

The coast guard is MONTHS behind on documentations. Like 7-8 months.

ask me how I know.

Rich

[sailorboy1]

Far as the tax issues I would ................................... ask the state tax people and not a boat forum of no tax experts.

[stormalong]

Whatever you do save all the receipts from materials purchases so you can prove that you paid taxes on them. The taxman always wants documentation. Save them forever.

[krupke]

In FL we have to register the boat with the state even though it is USCG Documented. The difference is the state does not provide a title. The state also collects the sales tax due on the boat. I am assuming that the rules are similar in CA.

Since this is a home built vessel you might be able to reduce the sales tax you owe CA by verifying that you paid sales tax on the materials that you purchased and used to build the boat (hope you kept your receipts!).

My suggestion is to register with CA and skip the USCG Documentation. Regardless of which route you select you will not be able to avoid the sales tax issue. However, as the previous poster stated you are much better off contacting the State of CA directly. Congrats on the new boat and good luck!

[EmeraldCoastSailor]

maybe CA is different but for my FL USCG documented boat I also have her registered with FL. I don't have the FL numbers on the bow but as I understand I must have the registration decal on port side of the boat (mine is on the boom). So at least as I understand it, it is a matter of what lettering/numbering get put on the boat. I don't have the FL numbers but I do have the USCG required name and hailing port on stern. The state wants their money every year!

[George DuBose]

Skylark is a USCG documented sailboat living in The Netherlands. Still flying the Stars and Stripes, but had to pay VAT to the Dutch and have a Post-Construction Assessment survey, just to hang out in Europe for awhile (more than the allowed 18 months).

South Carolina tried to charge me property tax. They got my address from NVDC, as that documentation certificate is delivered to an address in that state, but the boat has never been in SC waters.

I bet in CA you have to register. Several of the East Coast states say that if your boat is in their water more than 90 days, you have to register that boat in that state.

As far as the builder's certificate. I have my original from 1973 and it just looks like a government form filled in. If you're the builder and paid sales tax for all the materials, why should you have to pay tax again just because the materials took a different shape.

[George DuBose]

Master Carpenter's Certificate (Builder's certificate) USCG form 1261

[sail sfbay]

Just sold a boat and the USCG processed the documentation in 4.5 days from application.

[zengirl]

Do USCG Documented Vessels Need State Registration or Decals?
April 10, 2017
|
Gregory Singer, President, Yacht Docs Online



There's a lot of confusion over whether - and when - a Coast Guard Documented vessel needs to be registered with the state. The short answer is that UCSG Documented boats never need to be titled with the state, but may need to be registered with the state depending on how long the boat is on the state's waters.

First, as to the titling of the vessel, a vessel may either be state titled or federally documented, but not both. Think of USCG documentation like your title - that's really what it is, even though it has another name. In fact, federal law under 46 U.S.C. § 12106 actually prohibits a USCG Documented vessel from being state titled, and a state cannot require a USCG Documented vessel to display numbers.

However, states may still require registration of USCG Documented vessels for tax and other purposes. What's the difference between the title and the registration? The title is a formal, colored document used to prove and transfer ownership. The registration typically consists of a registration card and an annual state decal which must affixed to the boat. So while the Coast Guard Documentation is your boat's title, you may have to also register with a state.