Delaware 'Residency'

[simpleiron]

Has anyone had any experience establishing "residency" in Delaware, we are incorporated and documented FULL time cruisers, we are looking to register our vehicle obtain drivers liscense, basically belong somewhere and not belong there? can anyone help?
thanks Jim

[sailorgal]

We established Florida residency before we actually moved to Florida and were helped by St. Brendan's Isle mail forwarding service. They have a special service to help you get a FL driver's licence and establish residency. You establish a "real" street address and go from there. I highly recommend them:


Mail Forwarding Services at St Brendan's Isle

If you want to have your boat registered in DL, you can form a Delaware Corporation with the Delaware Secretary of state:

Delaware Division of Corporations - How to Incorporate in Delaware

And then find a Delaware Registered agent such as:

Delaware Registered Agents

For a fee, they will act as your agent (you use their street address as your corporate address) to get U.S. documentation as a DL registered boat.

Unless you specifically want to be official Delaware residents, this is one option to get your boat registered in DL.

[simpleiron]

Thank you so much for the information, we had heard of this type of thing in FL. we just wondered if such a thing existed in DL. Since we are incoprated and documented with a home port of Delaware just thought we keep everything in the same state. Thanks again

[foggysail]

Maybe off track but:

Not every state accepts Delaware documented boats at face value. Earlier in my boating years, I set up a corporation in Delaware, hired a Registered Agent (necessary if you don't live there) and attempted to subvert the Massachusetts sales tax.

Well, a funny thing happened on the way to the Forum!!! Massachusetts became aggressive and installed a so called Enviromental Police group and charged them with the responsibility to verify that sales tax was paid. Before this became a real problme for me, I paid the tax.

But those guys dressed like gun carrying peacocks, operating in $100K++ state owned power boats went after anything that moved. Now the getcha here was/is if you avoided paying the tax in any other state along with Massachusetts, they then when after you with a "water use tax."

This is a very interesting topic. For example Rhode Island which borders on Massachusetts some years ago did away with sales tax on boats!!! Their goal was to help boat sales in their state. AND YES, IT WORKS!!!

This year our senior senator, John Kerry (Swift Boats Fame) had a multimillion dollar sail boat made in Rhode Island.

He avoided giving a construction contract to one of the many boat builders here in Massachusetts to avoid paying taxes.........yeah, right on!!! When exposed by the media, this multimillionaire claimed..."that is incorrect, I had full intentions to pay the 6.5% state tax." Remember, Kerry has wealth from his family plus he smartly married into wealth, Teresa Heinz.

Foggy

[djmarchand]

The requirement to pay a state's sales or use (maybe the water tax that some poster griped about) tax is entirely dependent on the time spent in that state.

Generally if you stay less than 3 months in a state with a sales or use tax, you don't have to pay it. If you are documented with Delaware as your home port, then there is no need to "register" it in Delaware. Just keep moving and you will never have to pay sales tax.

If you do stay in a state with no sales tax for more than three months like Rhode Island you may be required to register it. But that is only a relatively minor fee and does not include sales or use tax.

This is all perfectly legal and John Kerry has my support- pay the minimum tax that you are legally entitled to.

David

[Kettlewell]

If you do stay in a state with no sales tax for more than three months like Rhode Island you may be required to register it. But that is only a relatively minor fee and does not include sales or use tax.

This is not true in some states. For example, Maryland will require the payment of use tax (I think they call it excise tax) after spending 90 days in the state unless you can prove you use it more in another state. You get credit for sales/use tax paid elsewhere. The point is that each state is unique in how they handle this issue, and it is worth investigating before you get caught in some unforeseen trap.

By the way, Florida requires a state registration sticker even if your boat is federally documented. I know, that appears to be contrary to federal law, but that is the Florida law.

[Pblais]

Since we are incoprated and documented with a home port of Delaware just thought we keep everything in the same state.

It's not an issue what so ever. The home port means nothing to any one. So I would keep that the same. FL having no income tax lets you not pay any or have to file and St Brendan's Isle does a great job on your mail. Lots of great options on mail now. The one thing is "Do not leave your boat In FL for more than 90 days!" Boat taxes in all states are only about where the boat is and not any paperwork or where you reside or claim to reside. Delaware solves that problem with no tax due ever but keeping a boat in Delaware is it's own punishment.

The only thing you need to do is have a US address to send your US Documentation papers to. They need to be signed and renewed each and every year. If your boat is never any one place in the US for very long you can out run the clock and the tax collector legally. Being able to count the days would be a skill you must acquire with high precision. The trick is doing it for the rest of your life.

[speciald@ocens.]

Florida recently capped boat sales tax at 18K so if your boat costs more than 300K, you don't pay any tax on the balance. They used this number as it is about what a Bimini or other off-shore registration costs. They anticipate about a 34M dollar per year increase in revenue to the boating industry and South Florida busineses.

[Captain Bill]

Nice to hear that FL capped the sales tax on boats, but that just means some other state will want the balance. Florida used to have a use tax exemption if you had owned the boat more than 6 months. Do they still have it or did they do away with it when they capped the sales tax?

[skipmac]

Originally Posted by Captain Bill

Nice to hear that FL capped the sales tax on boats, but that just means some other state will want the balance. Florida used to have a use tax exemption if you had owned the boat more than 6 months. Do they still have it or did they do away with it when they capped the sales tax?

Yes the six month exemption is still in effect. To paraphrase the FL law, if you purchase a boat in another state with the intention of keeping and using it in that state, register the boat in that state, and it does not enter FL for at least six months then you are exempt from paying FL sales and use tax. You are not exempt from the requirement to pay FL registration if the boat stays in FL for more than 90 days.

Since there seems to be some confusion and disagreement on this point I downloaded the applicable FL statutes and then called and spoke to two different departments in FL to verify.

[foggysail]

Originally Posted by djmarchand

The requirement to pay a state's sales or use (maybe the water tax that some poster griped about) tax is entirely dependent on the time spent in that state.

This is all perfectly legal and John Kerry has my support- pay the minimum tax that you are legally entitled to.

David

Nonsense!!! Sure, one can fight it, just hire an attorney @ $350+++/hour. Yeah go ahead, show them your stuff as they shaft your wallet. OH, and if they miss your wallet, you will still have great discomfort from where their shaft hits.


FOGGY

[motion30]

Hell I actually live in delaware but keep my boat in maryland, the tax police caught me and pay i did

[Wavewacker]

Hi, with respect to the 90 day rule, I assume that is 90 consecutive days. If that is true, seems to me on day 89 you could pull the lines go beyond the center of the river, bay, whatever into another jurisdiction, spend the night and come back a day later...does that work?

[skipmac]

Originally Posted by Wavewacker

Hi, with respect to the 90 day rule, I assume that is 90 consecutive days. If that is true, seems to me on day 89 you could pull the lines go beyond the center of the river, bay, whatever into another jurisdiction, spend the night and come back a day later...does that work?

Only if you can prove it.

In FL if you get into that kind of situation a marina bill, receipt from a fuel dock out of state or similar is required.

[gettinthere]

As was stated previously; with Maryland it's what state you spend the MOST time in. So you stay only 70 days in Maryland and think you are fine. They can require you to prove you spend 71 or more days in ONE other state or they stick you with their sales or use tax.

Many states see a Del registration as a red flag and they start digging extra hard.

Be prepared.

It is NOT illegal to sport a registration STICKER on a documented boat. It is against federal law to display registration NUMBERS on a documented boat. Almost all states require registration and display of stickers.