Originally Posted by nematon785
A couple more quick question: Why incorporate in California
? What is the benefit to basing your business out of California
? I only ask because I would be tempted to incorporate in a location that is more beneficial to a LLC, and I will admit, its been a while since I checked but it seems Delaware is notoriously good location for this. It is clear I don't know jack squat, and now we can all learn (if you are willing to explain the methods)
Is there a reason why one would choose to buy a California based LLC rather than accept possession offshore
and maintain the vessel home port in a State that would be more beneficial and register with the USCG rather than a state? Or even in Langkawi as opposed to the USCG?
Clearly Sales tax is a big concern. Any suggestions on how to protect myself and or my LLC if sales tax is demanded and questions come up from a taxing authority? Simply refuse? or do I need to hire a lawyer (or does my LLC hire a lawyer?)
At what price
point does it become worth wile to add this complexity? Obviously 300K and up gives a large tax savings, and most at this price
point would have additional assets worth protecting, so at 100k, the boat
is my home, I have nothing else asset wise, is it still worth it? What about 50k?
For lower priced boats, it makes less sense. The cost to maintain an LLC in California is probably $2K-$3K per year by the time you pay to have the tax return prepared (yes there is a separate return) and pay the state fees
. You do the math and decide if its worth it. If the boat
you want is already in an LLC, you can buy it that way, avoid the sales tax, and eventually dissolve the LLC. Consult with an expert if you do this, since the tax man frowns on tax avoidance and may have something the say if they feel the whole maneuver was solely to avoid tax. Some buyers will let some time pass before dissolving the LLC, so that the sale
and the dissolution are not closely associated.
I hope this suggestion doesn't start another wave of comments. My purpose in mentioning this is to give you something to discuss with your tax expert. No one here knows enough about your situation to give you specific advice that is valid.