Transient Vessel not registered in any state/USCG Documented

[Nocanvas]

Here's one for smarter minds than I.

If my home port is Bellingham WA marked on the transom and on the USCG Documentation but the boat never touches Washington waters. Am I correct that I don't have to pay registration taxes in Washington State.

Also if I don't stay in any other state long enough to be considered a resident (each state is different time wise). Am I correct that I wouldn't have to buy registration at all ever ?

I assume I could travel (not for commercial use) the Great Loop, Canada and the Bahamas without ever registering the boat anywhere as long as the boat traveled as a transient USCG documented vessel in each state or country. I would be interested to hear from a person that has accomplished this feet.

 

[Comodave]

Don’t bring it into Michigan. They will ticket you.

 

[Rufus]

Don't most tax dodgers set up a fake corporation in Delaware and register the boat under the phony business? Home port: Dover, Delaware.

 

[Steppe]

There are a multitude of US documented boats cruising all around the world with no state registration. As long as you stay under the 50 state's (all somewhat different) transient visitor limits you can avoid state taxes and registrations. But you may be subject to "cruising permits" or such levied by various states. And, if you are moored in any particular state don't be surprised if a county sheriff deputy tickets you or questions your status.

 

[sunchaser]

Here's one for smarter minds than I.

If my home port is Bellingham WA marked on the transom and on the USCG Documentation but the boat never touches Washington waters. Am I correct that I don't have to pay registration taxes in Washington State.

Also if I don't stay in any other state long enough to be considered a resident (each state is different time wise). Am I correct that I wouldn't have to buy registration at all ever ?

I assume I could travel (not for commercial use) the Great Loop, Canada and the Bahamas without ever registering the boat anywhere as long as the boat traveled as a transient USCG documented vessel in each state or country. I would be interested to hear from a person that has accomplished this feet.

So where is the vessel now? BTW, our documented vessel has never had a state registration of any sort.

 

[Rufus]

And, if you are moored in any particular state don't be surprised if a county sheriff deputy tickets you or questions your status.

This did indeed happen at a Michigan marina last summer, although it was triggered by an uninformed marine police officer who thought that the absence of numbers on the bow constituted an illegal status. The marina manager explained that the boats in question were federally documented and bow numbers were not required. The embarrassed officer didn't pursue it any further, but if he had been better informed, he probably would have asked for registration papers for the home port State. In this instance all of the boats in question also had State registration.

 

[Alaskan Sea-Duction]

This did indeed happen at a Michigan marina last summer, although it was triggered by an uninformed marine police officer who thought that the absence of numbers on the bow constituted an illegal status. The marina manager explained that the boats in question were federally documented and bow numbers were not required. The embarrassed officer didn't pursue it any further, but if he had been better informed, he probably would have asked for registration papers for the home port State. In this instance all of the boats in question also had State registration.

There are states that don't require state registration if the boat is documented. Alaska is one such place. As such no registration numbers on the bow.

 

[ksanders]

you are entirely correct in that is you are truly traveling then you do not need to register your boat except possibly your home state if it has registration.

You also do not need to pay any tax in any state, but be careful. As you indicated each state has it’s own definition of when your boat falls under their rules.

Just be cognizant of these rules and timelines and you’ll be good to go.

 

[twistedtree]

Here's one for smarter minds than I.

If my home port is Bellingham WA marked on the transom and on the USCG Documentation but the boat never touches Washington waters. Am I correct that I don't have to pay registration taxes in Washington State.

Also if I don't stay in any other state long enough to be considered a resident (each state is different time wise). Am I correct that I wouldn't have to buy registration at all ever ?

I assume I could travel (not for commercial use) the Great Loop, Canada and the Bahamas without ever registering the boat anywhere as long as the boat traveled as a transient USCG documented vessel in each state or country. I would be interested to hear from a person that has accomplished this feet.

I think the answer is "yes, but.."


Most states have visitor rules that welcome you for some period of time provided you are properly registered in your place of principal use. "No place" is unlikely to be an acceptable place of principal use, so you need to pick "some place". We were faced with exactly this on our last boat, and picked our state of residency and followed their rules for documented vessels, which conveniently were that no state registration is required. So we were unregistered in any state, but could show that our chosen place of principal use did not require state registration for documented vessels, so we were compliant with their rules.


I think that's a perfectly viable strategy, but I do thing you need to pick some place and follow their rules, and have some sort of justification for why you picked the "home port" that you did. If your residency is WA, and the hailing port is in WA, is suggests you should be following WA rules which require state registration. But if you are claiming to be following some other state's rules that don't require state registration, I think you are inviting a challenge, or at least a prolonged debate with whoever might stop you.


If you want to establish some justification for following a particular state's rules that don't require state registration, it seems wise to establish some nexus of some sort in that state. One possibility would be to establish an LLC in that state to own the boat. Then the boat is owned by a "resident" of that state. And if the hailing port is also from that state, it helps build the case, even though the hailing port is really of no actual significance.

 

[Rufus]

There are states that don't require state registration if the boat is documented. Alaska is one such place. As such no registration numbers on the bow.

I don't believe any of the States that do require registration for resident vessels that are documented require numbers on the bow. But they do require a sticker somewhere on the boat.

 

[MYTraveler]

The embarrassed officer didn't pursue it any further, but if he had been better informed, he probably would have asked for registration papers for the home port State.

With that better information, what would he have done if the response was, "Yea, I am violating <some other state's law>, so please don't tell them because I have nothing to show you." Or, better yet, "I am a resident of <any other state>, and my state doesn't require state registration under my circumstances." Then what does the better informed officer do?

 

[Ken E.]

There are states that don't require state registration if the boat is documented. Alaska is one such place. As such no registration numbers on the bow.

Good info on AK, Tom.

 

[Rufus]

With that better information, what would he have done if the response was, "Yea, I am violating <some other state's law>, so please don't tell them because I have nothing to show you." Or, better yet, "I am a resident of <any other state>, and my state doesn't require state registration under my circumstances." Then what does the better informed officer do?

Barring some set procedure, I would expect the informed police officer to advise the "other state" that he has noted a vessel that is home ported but not registered in their state, that they are potentially missing tax revenue that could be used for marine law enforcement/safety (for example), and provide them with the name and address of the (potential) tax dodger...regardless of the state of residence. If the marine police officer is well informed, he/she will know which states do not require registration.

 

[DDW]

I don't believe any of the States that do require registration for resident vessels require numbers on the bow. But they do require a sticker somewhere on the boat.

California requires numbers on the bow unless CG documented.

The OP can absolutely do what he says, but perhaps not with WA as the home port. Depends on if WA requires registration for vessels never in the state - it seems like they would have a jurisdictional issue if they did. What you tell the coast guard and paint on the transom for you home port is almost without effect or consequence. I've seen 100' boats which claimed landlocked midwestern cities as home port.

 

[Rufus]

California requires numbers on the bow unless CG documented.

Right. I was thinking in terms of a documented boat, but didn't say so.

 

[markpierce]

California requires numbers on the bow unless CG documented. ...

If you are docked at a marina in California on any January 1, don't be surprised if the respective county will assess property tax.

 

[hollywood8118]

If you are docked at a marina in California on any January 1, don't be surprised if the respective county will assess property tax.

Two different issues... property tax vs registration. Although in Washington state registration is considered a Use Tax.


We had a boat in California for 6 years that had no state registration.. but it was documented.


Every year we got a bill for personal property tax on the boat.


Washington dings the crap out of us for state registration.


HOLLYWOOD

 

[Lepke]

If you're not docked at a marina for longer periods, most states won't bother you. If you have a rented slip, other than transient dockage, most states require reporting at least yearly. If you have a private dock or have some arrangement to dock at a non marina, the state will probably miss you.

Some states are more aggressive at collecting taxes from boaters in their quest to tax the evil rich. If you have a larger boat, in their eyes, you are rich and deserve the taxes.

 

[Gmarr]

How many dollars is this saving?

 

[dhays]

I don’t think Washington cares what is listed as your home port on the USCG documentation. They do care where you keep the boat. If you keep the boat in WA over a certain length of time, they will care very much. IIRC some states will require that you have a legitimate state registration or they will require it of you if you are in their state at all.

This subject comes up a lot. If a boater really is transient and never stays more than a month in any state really doesn’t have a state to register the boat. That is fine. However, I certainly wouldn’t regulate my cruising life in such a way to avoid state registration.

 

[ksanders]

In Washington on the 61st day a boat is in their waters Sales/use tax based on the boats value becomes due. On day 60 you can apply apply for a 60 day cruising permit. That permit can be extended one time, giving you a total of 180 days. If you are haveing repairs done you can file a repair affidavit stopping the clock while repairs are being made.

In California, if you have owned the boat for 6 months or more (12 months for residents) you will not pay sales/use tax on the boat.

Property taxes are another story. Even here in Alaska if you have a permenant slip (vs paying transient rates) the local jurisdictions can and do assess property taxes. I pay about 0.75% per year in Seward Alaska. I have heard that California is around 1% but cannot verify that.

To me, that makes Washington far less attractive of a place to keep my boat long term, unless I had some reason I had to be there.

Baja is calling my name

 

[Benthic2]

You'll also want to pay attention to whether days are counted in total or in sequence. You may not be able to just hop over the border every 59 days to avoid a 60 day requirement.

 

[sunchaser]

How many dollars is this saving?

Avoiding WA moorage saves about 10% of boats value plus yearly fees. Oregon has no sales tax.

Kevin sums it up nicely. The 0.75% property tax Kevin mentions is nicely offset by low AK moorage costs.

 

[psneeld]

I believe the verbiage in FL, you have 90 days reciprocal privileges if registered in another state, if not registered in another state you must register in Fl and jump though their hoops which might get into the sales tax tango.


Never eyeballed the Michigan law but it sounds similar from what people post.


If doing the loop, you spend a LOT of time in FL waters.

 

[twistedtree]

I believe the verbiage in FL, you have 90 days reciprocal privileges if registered in another state, if not registered in another state you must register in Fl and jump though their hoops which might get into the sales tax tango.

There is an interesting question about exactly what this means, and I'd be interested if anyone has and direct experience.


A number of states, perhaps most, exempt you under these conditions. But what does it mean? Is it:


1) You have a state registration from somewhere else? What if your home state doesn't require registrations fro documented vessels? Are you then immediately obligated to register in the first state you encounter so that you hold some registration?


OR


2) You are properly registered according to the laws of your home state, whatever those laws say. So if you are from CA or MA or AK where documented boats are not registered, you are fine with just documentation because that constitutes a properly registered boat in your home state.


I have taken it as #2 above, i.e. you need to be in compliance with your home state laws.


I have never been stopped so haven't tested it that way. But I was hassled by WA and asked to show my registration or otherwise invited to pay 10% use tax. I wrote back saying I had no registration because my home state doesn't register documented boat, and accounted for my time in WA, and that was the end of it. So at least WA accepted interpretation #2 above.

 

[O C Diver]

I don't find Florida's registration fee onerous at just under $200 for my boat. It is my understanding that if you own the boat for more than a year and are not a FL resident when you acquire it, registering it in the state of FL is done without paying sales tax. That's also how it works on cars and trucks. When I moved to FL, all I did was pay for registrations on my truck, trailers and boat.

Ted

 

[Ski in NC]

It sure seems to vary state to state! In NC I think they have assessors that prowl the local marinas and write down the names of the documented boats then look up the owners, then send them a tax bill. Up to the owner to dispute it based on whatever the text is in the law. They found mine (which I built, so had no real paper trail other than USCG doc, transom name and port), but taxes are reasonable so I just pay it.

Since mine arrived without any sale involved, no sales tax, this is just property tax.

The state registered boats I think they look up on their computer databases. They got my old skiff that way.

I have heard of other NC boats making a specific trip to SC and getting dockage and fuel (and a receipt) around Jan 1 and then sending copies of that in as part of a dispute. But I never bothered to flush out the details. Something like if you can prove the boat was not in NC on Jan 1, then you could file a claim to avoid it (???).

My very general understanding is that most states ignore the home port on the documentation and rely more on physical presence. But who knows.

Edit: It is our county that sends the tax bill, not the state, but the county is apparently following state law.

 

[Bkay]

If you are docked at a marina in California on any January 1, don't be surprised if the respective county will assess property tax.

Same with Virginia. Our states registration fees are almost nothing (and our boat sales tax is not terribly onerous). But annual personal property tax is based on the county you are in and can take your breath away.

Every marina and boatyard must report vessels at their facility on 1 January. When the tax bill shows up, you are expected to either pay it or prove to the tax assessor that you are a resident of another tax jurisdiction and have paid tax to that jurisdiction for the year in question.

I would not be surprised that a number of states use this policy regarding PP tax.

 

[bgillroy]

You'll have to continually move to avoid ticket once ticketed ignore it and problems multiply . Upon purchase of our fed doc boat USCG said that documented boats are not to be state registered period, however home state tax payment is required. Since we winter in FL we paid FL state tax. All states have their own particular tax statutes ....good luck

 

[denverd0n]

Also if I don't stay in any other state long enough to be considered a resident (each state is different time wise). Am I correct that I wouldn't have to buy registration at all ever?

You are correct. Absolutely nothing at all wrong with arranging your affairs, and moving your boat, to avoid the need to pay taxes or fees. So long as you follow the law.


And in that regard, this is where "each state is different" can become an issue. As psneeld observed, in Florida the law says that you have 90 days IF -- and only if -- your boat is registered in some other US state or territory. If you have no state registration then the law requires you to register your boat with Florida immediately upon entering the state. You get no grace period.


I suspect that Florida is not unique in that regard. You have to check the laws in every state you will visit, and I would not be surprised if there are others that offer no grace period for boats that are not already registered elsewhere.


If you pass quickly are you likely to get caught? No. You are almost certain to get away with it. And, really, a lot of people would see nothing morally wrong with avoiding the registration fees in this way. But only you can decide what you are comfortable with. Regardless, it is the difference between "tax avoidance" and "tax evasion."


Good luck, whatever you do.