My First Boat

[rockborn]

i am closing on a 1980 46 morgan this tuesday in chaleston s.c. i live in new jersey, and plan on living aboard. where should i register her? someone suggested delaware.

[Nibiruwayne]

Hello, owned a 46' Morgan , 1981. great space for the length.
Check into forming an LLC in Delaware. It will save paying sales tax among othe r advantages.

[rockborn]

thanks for the reply. how soon after i purchase should i do this? i wont bring her up until may.

[skipmac]

Where to register depends.

1. Will you be keeping a shoreside address?

2. Where will the boat be docked/moored/anchored, especially for the first 90 days and first 12 months?

3. If you don't plan to keep the boat in Charleston, how long will it stay there before you move it?

4. What are your reasons for asking which state:
a. most convenient place for you for to get mail, long term residence, voting, other daily living issues.
b. minimize your sales and use tax expense?
c. minimize your future possible tax exposure?
d. other?

[skipmac]

Originally Posted by rockborn

thanks for the reply. how soon after i purchase should i do this? i wont bring her up until may.

Do not know the regulations in SC but most states will hit you with sales tax on the boat and mandate you register the boat in their state if you purchase it there and do not remove it within a certain time period, usually 30 to 90 days.

If you do have to pay sales tax in SC most states will give you credit for that and not make you pay twice.

But every state sets their own rules and can get really nasty about it if you try to register in a state where you nor the boat live in an attempt to duck the local taxes. That's why it's important to know where you will keep the boat.

[rockborn]

strictly tax purposes. i have a n.j. address for my mail. the salesman at charleston yacht sales told me there is no sales tax.

[skipmac]

Originally Posted by rockborn

strictly tax purposes. i have a n.j. address for my mail. the salesman at charleston yacht sales told me there is no sales tax.

Be careful with this. States on the east coast are very aware of this idea and many will aggressively pursue you for the sales tax if they think you are liable and trying to duck it.

The key is where you keep the boat? If in a state that does charge sales tax you run the risk of being charged, even if the boat registered in another state. FL for one is very big on this.

By the way, I checked the SC Dept of Revenue web site and it shows sales tax is charged on boats but a max of $300.00.

[rockborn]

Thanks for the reply it was a big help!

[s/vPainkiller]

The good news is that the maximum sales tax in SC is $300.00. However, if you leave it in SC, they will hit you with Personal Property tax on the boat regardless of whether you have a shoreside address in SC. The amount and timing is assessed county by county.

Every state has its hand out looking for your money. And they will get it. So make sure that you know the rules in your state of residence and where you keep the boat. Documenting the boat usually will not help you hide from the state revenue folks depending on where you live/keep the boat.

When we bought Painkiller 2 yrs ago, I made the purchase in MD and the broker was from FL. I had to sign forms from both states saying I was not keeping the boat in their jurisdiction, or else they would assess the appropriate taxes.

Do a search on the archives here. There has been lots of discussion on this topic.

Scott