Property Tax on My New Boat !

[hellosailor]

"How, indeed, one can be charged property tax on sales tax........I do not get."
No great mystery, auto insurance sometimes values your CAR the same way.

If you had to replace the a $100,000 boat, what would it cost you to buy a replacement? $100k, or $100k PLUS TAX? Ergo, the value of the boat, as a purchased possession, in $110k or $108k or whatever your total cost to replace it would be.

Sounds perfectly logical to me, even if I don't like the whole concept of personal property tax. If you had a new car and it was stolen in the first month--your insurance might very well cover the whole replacement cost, including the tax. Would that valuation seem unfair to you then? Probably not.

Same thing here.

Of course you can change the property tax valuation so it just reflects the net cost of the boat. First you write a letter to your assemblyman...and you take it from there. Once you reduce that tax--they're just going to increase something else to make up for it though.

[Charlie]

Originally Posted by Joli

So you're one of the many who have left California and brought on the budget deficit crisis? I read recently that fully one half of the budget deficit (~$8 billion) is blamed on the people who got fed up and "voted with their feet".

Can't tax yourself into prosperity can you? It's certainly working for California.

Soon enough we'll be cruising...........

Hi Joli:

I'd be interested in that article. Do you remember where you read it? How can a budget deficit be caused by people who leave? I don't understand that one, unless you mean companies that left the state with good paying jobs.

[Joli]

Hello Charlie,

I can't rememberr where I read it but the article was recently published ~ maybe a month ago?

The state calculated that the loss of income from business and citizens leaving over the past 5 years accounted for half of the current $16 billion dollar budget. Can you belive that, California drove out $8 billion in annual revenues, it is just a staggering number.

If I can find it again I'll post the link.

Originally Posted by Charlie

Hi Joli:

I'd be interested in that article. Do you remember where you read it? How can a budget deficit be caused by people who leave? I don't understand that one, unless you mean companies that left the state with good paying jobs.

[Charlie]

Thanks Joli:

I can believe it. California makes things so incredibly hard to do business it is crazy. They make it almost impossible to comply with all hteir laws and turn a profit.

[TaoJones]

Originally Posted by Charlie

Hi Joli:

I'd be interested in that article. Do you remember where you read it? How can a budget deficit be caused by people who leave? I don't understand that one, unless you mean companies that left the state with good paying jobs.

I'm dubious as well, Charlie. I don't doubt that Joli read what he said he read, but I sure would like to know the source of that point of view.

If it was someone with a connection to government, then it doesn't surprise me. From that POV, those who leave are selfishly dumping the entire cost of government on those who remain. The concept that, just maybe, the public interest could be served by fewer feather-bedding public employees who work for (gasp!) private sector equivalent wages, have the same health care options as the average working stiff, and make do with the same pension options just never seems to occur to them.

The size of government work forces never goes down, and the benefits they wring out of those negotiating on the public's behalf are extraordinary. And why not? It's not as if the negotiators are paying it themselves. After all, they, too, are feeding at the public trough.

While thousands of Californians leave the state every year, bound for more agreeable living elsewhere, it isn't as though there aren't others streaming in to take their place. California's population total has reflected a net positive bias since as least World War II, and probably clear back to the 1849 gold rush.

So the notion that out-migration accounts for California's budget deficit is nonsense. It's a flimsy excuse foisted on a gullible public to excuse state government's own profligacy.

TaoJones

[JiffyLube]

Originally Posted by Joli

So you're one of the many who have left California and brought on the budget deficit crisis? I read recently that fully one half of the budget deficit (~$8 billion) is blamed on the people who got fed up and "voted with their feet".

Can't tax yourself into prosperity can you? It's certainly working for California.

Soon enough we'll be cruising...........

One major problem that has California in it's current state of affairs is, all the state programs that were funded based on tax revenues that were going to be generated, by Dot Com companies before the Dot Com bust. The state legislature figured that the Dot Com period would last forever (like idiots), but when the bubble burst none of the funded programs were canceled...to my knowledge. I would guess that those same funded programs are still being funded, with the anticipated tax revenue that is no longer forth coming.

[Jerry Woodward]

So how much tax will I have to pay? I'm trying to assess the real cost of owining a boat in California vs Florida. I presume I will have to pay sales tax at the time of purchase, plus a yearly property tax. Can someone give me an idea of how much that will be in CA vs FL?

[Charlie]

Originally Posted by Jerry Woodward

So how much tax will I have to pay? I'm trying to assess the real cost of owining a boat in California vs Florida. I presume I will have to pay sales tax at the time of purchase, plus a yearly property tax. Can someone give me an idea of how much that will be in CA vs FL?

Annual tax is 1% of assessed value. Sales Tax varies by county. Here is a link but it goes from 7.25% to 8.75% (LA) Don't know about FL

http://www.boe.ca.gov/sutax/pdf/city-rates_07_08.pdf

[TaoJones]

According to your linked list, Charlie, Los Angeles County is "only" 8.25%, while San Francisco County is 8.5% and Alameda County is 8.75%.

TaoJones

[jackiepitts]

Being from California ourselves I can add that every county may very well asses your boat at a different value. Since we are transient most of the time we received a tax bill from three different counties within So Cal. It seems the tax guy walks the dock several times a year looking for new boats to tax and we were taged in three different counties. Luckily we only have to pay one of those counties (if you can call that luck).
The difference between the asessed value in each county was major.
We really can't wait to leave California!
Best

[Joli]

Why is it someones responsibility to stay? That sounds like communism.

California exodus turns to stampede

California exodus turns to stampede
High taxes drive jobs, people from one state to another

Posted: February 20, 2008
8:00 pm Eastern

© 2008 WorldNetDaily

WASHINGTON – California, which once lured Americans from near and far, is now driving out millions of the most productive residents – including high percentages of the most affluent.


"When California faced a Mount Everest-sized $14 billion deficit in 2003, one of the major causes for the red ink was the stampede of millionaire households from the state," says a report called "Rich States, Poor States" by economists Arthur Laffer and Stephen [COLOR=blue! important][FONT='Times New Roman', Georgia, Serif][COLOR=blue! important][FONT='Times New Roman', Georgia, Serif]Moore[/font][/font][/color][/color]. "Out of the 25,000 or so seven-figure-income families, more than 5,000 left in the early 2000s, and the loss of their [COLOR=blue! important][FONT='Times New Roman', Georgia, Serif][COLOR=blue! important][FONT='Times New Roman', Georgia, Serif]tax [/font][COLOR=blue! important][FONT='Times New Roman', Georgia, Serif]payments[/font][/color][/font][/color][/color] accounted for about half the [COLOR=blue! important][FONT='Times New Roman', Georgia, Serif][COLOR=blue! important][FONT='Times New Roman', Georgia, Serif]budget[/font][/font][/color][/color] hole."
And it's not just the rich leaving.

Originally Posted by TaoJones

I'm dubious as well, Charlie. I don't doubt that Joli read what he said he read, but I sure would like to know the source of that point of view.

If it was someone with a connection to government, then it doesn't surprise me. From that POV, those who leave are selfishly dumping the entire cost of government on those who remain. The concept that, just maybe, the public interest could be served by fewer feather-bedding public employees who work for (gasp!) private sector equivalent wages, have the same health care options as the average working stiff, and make do with the same pension options just never seems to occur to them.

The size of government work forces never goes down, and the benefits they wring out of those negotiating on the public's behalf are extraordinary. And why not? It's not as if the negotiators are paying it themselves. After all, they, too, are feeding at the public trough.

While thousands of Californians leave the state every year, bound for more agreeable living elsewhere, it isn't as though there aren't others streaming in to take their place. California's population total has reflected a net positive bias since as least World War II, and probably clear back to the 1849 gold rush.

So the notion that out-migration accounts for California's budget deficit is nonsense. It's a flimsy excuse foisted on a gullible public to excuse state government's own profligacy.

TaoJones

[fcsob]

It says her that boat are exempt.FL Dept Rev - Property Tax Oversight main page

[my1972ih]

many folks buying bigger ticket items set up LLC's in Montana to buy, register and own the boat, airplane, RV, etc in MT. saves a ton on sales taxes since there is no sales tax in MT

[hellosailor]

Just bear in mind that if you set up one of those LLCs, you are creating a permanent paper trail showing the creation of what is called a "sham corporation" and your tax fraud, if you have done this for no business purpose except evasion of your own state use tax, or other taxes.

Yes, when a corporation has no legitimate business purpose except evasion of taxes, that's a crime. The IRS has prosecuted this at a federal level for decades, the states will eventually catch on and start prosecuting the same way they went after Delaware boat registrations in the 80's.

Montana doesn't care, they're getting revenue.

If the corporation has some other legitimate business purpose, that's something else again.

[dohenyboy]

"Anyone may arrange his affairs so that his taxes shall be as low as
possible; he is not bound to choose that pattern which best pays the
treasury. There is not even a patriotic duty to increase one's taxes.
Over and over again the Courts have said that there is nothing sinister
in so arranging affairs as to keep taxes as low as possible. Everyone
does it, rich and poor alike and all do right, for nobody owes any
public duty to pay more than the law demands."
Judge Learned Hand

Tax avoidance is legal. Tax evasion is a crime.
State sales taxes are assessed based on residence of the owner or location of the vessel when it was sold or where it was moved to after the sale.
If the owner of the boat is not a resident of the state where sales tax is assessed, and the boat is not present in that state at the time the sales tax (or use tax) accrues, then no tax is due.
It is perfectly legal to hold an asset in corporate or other form such as an LLC. However, the IRS views single member LLCs as the same as the taxpayer-you cannot get a tax identification number. But they are perfectly legal. As far as corporations, the IRS has a definition for a "personal holding company" under the Internal Revenue Code. No, if you have a PHC the IRS does not come to lock you up. You may have to pay some taxes you might not have to pay if you were just a C corporation and not a PHC.
Every single wealthy person in the USA who is not brain dead uses corporate or LLC vehicles to hold assets. There can be estate planning advantages too.
All this is subject to the individual circumstances and the law of your state. If you consult a tax attorney or tax accountant he can provide appropriate advice. Enrolled agents or your typical tax preparer usually lack the expertise. Never rely on the opinion of anyone on a message board. Or get your CPA degree or enroll in a good tax program such as the NYU LLM.