tax ramifications

[capt steve]

greetings all,, just joined and am looking for some advice.. we are considering buying a boat and having it shipped from michigan to the west coast. would it make any sense to establish residency in oregon being as there is no state sales tax there?? i really don"t feel like giving california twenty grand as i don:t care for the way they spend my money--- thanks so much for any replies,,, capt steve

[shamrock]

Capt Steve,

In most states if the boat is there more than 90 days you are required to register in that state and pay taxes. Typically a credit is given for taxes paid so if you move you don't pay double taxes but would pay the difference if moving to a higher taxed state.

I'm not sure specifically about CA but most states have caught on to the John Kerry approach of leaving a boat in Delaware for 6 months to avoid taxes.

With that being said, my boat had a valid MD registration and was on a mooring all last year in CT. I did actually register in CT but never got around to changing the sticker. Nobody asked me any questions... Supposedly there are steep fines, but I imaging this is a really hard thing to police.

Good Luck!

[denverd0n]

If you are going to use the boat in CA then having your residence in OR won't make any difference. If you would actually be using the boat in OR, then it might make some sense to establish your residence there.

Besides sales tax you also have to consider property taxes. Not sure about CA or OR in this regard, but a number of states will charge you a percentage of the value of the boat each year as a personal property tax. North Carolina does this (or at least did, when I lived there).

But the real answer is, a forum like this is not the place to get tax advice. Seek out a professional, or find the answers yourself on official government websites. Tax advice from a bunch of strangers on an internet forum like this one is worth exactly what you pay for it--NOTHING! At best, someone might be able to point you to the proper government websites to find your answer.

Good luck.

[SkiprJohn]

Welcome aboard!
Hope you can find the right information on taxes but I'd not be advertising that you want to dodge taxes because state tax officials could be on the forum.
If you want to buy stuff for your boat then do it in Oregon because it has no sales tax. If you establish Oregon residency they do have an income tax so your income would be taxable.
kind regards,

[Tayana42]

California does impose sales tax on boats purchased here as well as property tax. Many boat buyers opt to do an off shore purchase to avoid sales tax. We bought our boat 12 or 13 years ago and called the CA state Board of Equalization to find out how to do an off shore purchase. They told us exactly what we needed to do and what documentation would be needed. At that time you needed to take possession out of CA and keep the boat out of CA for at least 91 consecutive days of the first 6 months of ownership. The idea is you bought the boat out of the state for use out of the state and later changed your mind and brought your possession into the state. The closest marina in Mexico, in Ensenada, did a great business with the "91 day Navy". I believe the current law requires the boat to be out of the state for a full 12 months. But, call State Board of Equalization and ask. Nothing to lose.

[capt steve]

TAYANA, THANKS FOR THE REPLY, WE ACTUALLY DON"T PLAN ON USING THE BOAT IN CA,,, MOSTLY IN THE PNW UNLESS WE TAKE IT TO MEXICO IN THE LATE FUTURE.. AM LOOKING INTO TAKING IT TO OREGON CURRENTLY... THANKS FOR YOUR REPLY,,, CPT STEVE AND TINA