Property Tax question for circumnavigators

[Laurief]

Does one have to pay property tax on a boat that's not currently in the states?

Scenario: We'll be leaving California for a circumnavigation. Before we leave we will be moving legal residency to Florida. When we get back around, we'll be living in Florida (so not quite a circumnavigation!). Who do we pay property tax to, and when does it start? When we declare residency in Florida, or when the boat gets to Florida?

[wholybee]

Originally Posted by Laurief

Does one have to pay property tax on a boat that's not currently in the states?

Scenario: We'll be leaving California for a circumnavigation. Before we leave we will be moving legal residency to Florida. When we get back around, we'll be living in Florida (so not quite a circumnavigation!). Who do we pay property tax to, and when does it start? When we declare residency in Florida, or when the boat gets to Florida?

I actually had to deal with this (nearly) exact situation in California. First, the tax is paid to your county, not the state, but falls under state law.

Your boat is assessed for the year starting July 1st, for the county your boat physically was in on January 1st. It goes by where your boat physically is, not the boat's documented home port. So if you leave in January 2021(after the 1st), you will be assessed in California for the year that starts July 1, 2021.

I left California in July 2018 for a circumnavigation. I notified the assessor in writing when I left, in hopes that I would not be assessed a bill when my boat was not there. My boat was not in California in January 2019.

I got a bill anyway when I was in New Zealand. According to California law (apparently, I am not a lawyer) once a boat is assessed in California, it is a California taxable asset until it is taxed in another jurisdiction. So to cancel the bill in California, you will need to show a tax bill from somewhere else showing that your boat is being taxed elsewhere.

With that in mind, differing counties might handle that differently. I was able to provide several months of marina bills to prove my boat was not in the US anymore, and the assessor accepted that in lieu of a tax bill.

So, pay California if you are in California on January 1st. Tax is not due in Florida until you get there. You may still need to pay California tax until you arrive in Florida, but there is a reasonable chance you will be able to get out of it if you notify them you are leaving before you leave, and keep receipts proving you are not there.

[Captain Bill]

Given that there is no property tax on boats in Florida, California's rule about "until taxed in another jurisdiction" might present a problem.

[roverhi]

I notified the proper California tax people that I left CA for HI. Never heard from again. In my case, notifying the proper authorities and leaving the State ended the tax obligation.

[Jim Cate]

When we left California many years ago I was informed by the then head of the Alameda county tax office that until I registered the boat somewhere else I would be liable for the Calif tax. He then said in our place, he would do so immediately... and I did. No further contact over the intervening three decades, so I think I'm safe!

Jim

[Laurief]

Captain Bill, what do you pay on your boat? Use tax? Some other sort of assessment? Where the heck does Florida get its revenue?

[Macblaze]

Originally Posted by Laurief

Captain Bill, what do you pay on your boat? Use tax? Some other sort of assessment? Where the heck does Florida get its revenue?

Property tax on a boat struck me as absurd so I started a thread about different tax regimes. Some interesting answers: https://www.cruisersforum.com/forums...ed-243549.html

[Captain Bill]

Originally Posted by Laurief

Captain Bill, what do you pay on your boat? Use tax? Some other sort of assessment? Where the heck does Florida get its revenue?

We pay only a registration fee on a sliding scale depending on length. Costs me about $140/year for the 44 and $25/year for the dinghy. Florida gets much of its revenue from Sales and resort taxes. These mostly hit the tourists. Of course this year is going to be a bit tight as we are a tad short on tourists this year. Property tax only applies to real estate and business assets.

[jt11791]

Florida does have a sales(use) tax on boats paid at the time of registration. You get credit for sales tax paid to another state, so when I moved my boat from New York to Florida, I did not owe any additional tax. The Florida sales tax is only levied once, not annually.

[Captain Bill]

Originally Posted by jt11791

Florida does have a sales(use) tax on boats paid at the time of registration. You get credit for sales tax paid to another state, so when I moved my boat from New York to Florida, I did not owe any additional tax. The Florida sales tax is only levied once, not annually.

If you have owned the boat in another state for more than six months and are not a FL resident you will not owe sales tax on the boat. Also note that any time spent out of the US cannot be counted as part of the 6 months. So if you bought your boat in CA 4 months before you left on a circumnav and landed in FL ten years later you would still be liable for the sales tax minus credit for any already paid in another state.

[Dogscout]

This subject interests me greatly and like the OP I am hoping to hear what others have experienced. I bought my boat in Malta and had it US Documented with a home port in Tennessee. Now this boat will likely never go to Tennessee. I have not contacted TN regarding the boat and other than the contents of a storage unit I no longer have any property in TN.

I am curious as to what anyone's thoughts are on this. Do I owe TN any Tax?

[mvweebles]

Originally Posted by roverhi

I notified the proper California tax people that I left CA for HI. Never heard from again. In my case, notifying the proper authorities and leaving the State ended the tax obligation.

This is similar to my experience 2 years ago when I left San Francisco for Mexico. I did forward an email from my marina that said I had vacated my slip. I guess they figured I'd show up in another slip if I hadn't left or maybe due to low taxable value of the boat (1970 36' Trawler), but there was no further inquiry on their part. I had heard stories of relentless hounding by the California Board of Equalization (the relevant tax authority).

Until I arrive back into a US tax jurisdiction in a few years (Florida), I have no plans to pay any sort of tax on my boat except to keep USCG documentation current. Volunteering to do so seems like breaking into jail to me.

Peter

[waterman46]

Inform the tax collector of the county in which you are now being taxed, of the date the boat will no longer be in his county. Keep a record of this notification in case you receive a tax bill in the future from same county. Also keep records of marinas in the other states and countries in which you stayed, especially the first one to prove when you left CA.

Then don't worry about any taxes until you get to whatever state you end up in as permanent. Don't worry, they will find you in the marina.

[waterman46]

Originally Posted by jt11791

Florida does have a sales(use) tax on boats paid at the time of registration. You get credit for sales tax paid to another state, so when I moved my boat from New York to Florida, I did not owe any additional tax. The Florida sales tax is only levied once, not annually.

I think OP is talking about property tax on this boat. I know this is a weird subject not understandable to those who live in some states that don't tax boats each year as real property. Actually they say they are taxing you on a "possessory interest" in the "land" underneath your boat, which of course is ridiculous.

[garychurch]

Different states and counties have different requirements for sales tax, boat registration and property taxes.

If you know these requirements by actually reading their requirements posted on official web sites you can figure out what fees and taxes are due when.

For example state boat registration is not required if you do not meet their time frame. Many states only require registration if your boat spends 60 consecutive days or more in their waters. I assume sales taxes may be coupled to boat registration - paying sales tax or providing proof sales tax was paid to another state.

Many coastal water state counties exempt boats from property taxes.

As far as I know fees and taxes apply to where your boat is located and for how long.