Another tax question (sort of)

gwkiwi · Jan 24, 2014

Spike said:
I guess a little background is in order first. My wife and I plan to retire this year and sell off everything. We will be cruising full time for a couple of years before deciding on a land base somewhere in warmer climes. We're both getting tired of these polar vortexes (vortices?) We will be doing the loop slowly, north in the summer south in the winter...farther north the next year etc.

My plan has been to use the St. Brendan's Isle mail service to establish some sort of residency. Florida seemed a good choice with no state income tax. The problem is our boat is currently registered in KY. as they have no sales tax requirement. In reading an earlier post and the state of FL tax page I assume I will be responsible to register the boat and pay the full tax the moment we reach Florida in the boat. Not a huge amount or a real turn off but something I'd like to avoid if possible.

I guess the real question here is, does anyone know of another similar mail service that does the same thing as St. B's that's not in Florida? A service somewhere land-locked maybe? If the state has an income tax we may be better to stick with FL and take the hit once. I've been looking on the web without much luck.

Not sure where you got your information but KY does have a sales and/or use tax on boats unless you qualify for a valid waiver as authorized by the KY Department of Revenue (DOR) and specified in the state statutes.

Dont listen to advice on a public forum contact a KY CPA with your questions or the DOR directly.

Itwasntme · Jan 25, 2014

As a securities broker for 18 years I observed a similar problem. The regulators dogged the people who complied with the law and registered. They have no interest in going after the licensed people who were operating until the frauds were already committeed.

Will · Jan 25, 2014

Bought the boat in MD, while an MD resident, but immediately moved to FL, to good old Green Cove Springs. Signed a pice of paper in MD and was exempted from MD sales tax. Went to the court house in Green Cove, and ponied up the cash, got my orange sticker for both boat and dink, drivers license, license plates etc and am now a FL resident as of Dec 16th.

So now when I filled out the USCG documentation, it asked if the boat was registered, so I said yes.

Don't you need to have the boat registered to document it?

Regardless it is the contract that we have with our government, and I am the first to hate paying taxes, I think, the whole thing stinks, and I despise free loaders....I could digress.....gov waste....UGH I am seeing red just thinking about it.

The folks in green cove rock, and really helped me escape MD, for that I a thankful and would recommend their services.

Make a plan, and budget accordingly, I have done the move for tax relief thing several times......in my experience, one way or another the money still goes out the door, if you look at the entire tax burden. This time I wanted license plates that said "In God We Trust" so it was worth it.

markpierce · Jan 26, 2014

Will said:
...

Don't you need to have the boat registered to document it?

...

No, however, some states require a boat be registered even if it is documented. In California, documented boats needn't be registered with the state, but they're nevertheless subject to state taxes (sales/use/property taxes).

Bay Pelican · Jan 26, 2014

Spike said:
I guess the real question here is, does anyone know of another similar mail service that does the same thing as St. B's that's not in Florida? A service somewhere land-locked maybe? If the state has an income tax we may be better to stick with FL and take the hit once. I've been looking on the web without much luck.

Since you do not have a land based home you can become a resident of a state by documenting and registering your boat in that state and considering the documented address to be your legal address. This requires that you become a resident, subject to any tax that applies. Two states come to mind on the East Coast, Delaware and New Hampshire. Neither has a sales tax. You need to check on the effect on you of the other taxes for that state.

A UPS store physical address should work for your legal address, what you are looking for in terms of service is a PMB, a private mail box.

I you need the services provided by St. Brendan's in terms of scanning the mail you can have the UPS store forward your mail to St. Brendan's.

This is addressed solely with respect to the sales tax. After the legally required period of time as a resident of another state you can move your boat to Florida. This will not work for those states such as Maryland that subject you to a use tax but credit past paid taxes as you have paid no sales or use tax.

HiDHo · Jan 26, 2014

Taking advantage of legal ways to avoid paying taxes has been done for a long time. Buying your multi-million dollar motorhome in Montana which is one of five states with no sales tax is a no brainer for full time rv'ers. This money saving stragey is also done by yacht buyers all the time. Check out John Kerry's 7 million dollar yacht that is not bearthed in the bay state to save paying $4oo,ooo+ taxes, as if he doesn't have the money to pay the tax man. Best advise would be check out each state, they all have different rules and take advantage of six month rules and sales tax amount for each state. The real kicker is why sale tax needs to be payed over and over on each sale, it would be interesting reading to compile the sale tax that has been payed on an individual yacht over it's lifetime.
Bill

Moonfish · Jan 26, 2014

This is the mail service we use every summer while we're out cruising/working:

http://www.dockside-solutions.com/#2719

Based in Seattle and owned by a liveaboard and friend of ours. Excellent service!

Underway · Jan 26, 2014

I'm not clear if the boat is currently kept in Kentucky or Ohio.

Underway · Jan 26, 2014

Bay Pelican said:
.... Two states come to mind on the East Coast, Delaware and New Hampshire. Neither has a sales tax.

Ah yes, the Delaware dodge...

By the way, the subject boat appears to have been in Ohio since its purchase in Kentucky last summer. Both are sales tax states.

Spike · Jan 26, 2014

Thanks all for the replys. I will try and clear up a few of the questions.

My main point was, if we use the St. Brendans service would we be required to pay the FL. tax once we get the boat there. I don't have a problem paying the tax if required, just wondered if another similar service might be a better choice. It looks like Denverd0n cleared that one up. I have no intention of trying to hide from the tax man (who apparently doesn't exist in FL.) I still like to sleep at night.

We will have owned the boat for over a year before we get there so the 6 month rule isn't an issue.

Now to really confuse you...we live in Ohio but also own property in KY. According to the state of KY. we don't owe any sales tax or need to register a documented vessel so we used the KY address to document it. The boat is also berthed in KY so that just seemed to make sense. We now do our boating on the Ohio river which is owned by KY....and bought the boat in TN! Head spinning yet? :lol:

Thanks again for all the help. I still plan to find a registration office and see what their answer is if I can get to the keys in a couple of weeks.

Another tax question (sort of)

gwkiwi

Guru

Itwasntme

Veteran Member

Will

Veteran Member

markpierce

Master and Commander

Bay Pelican

Moderator Emeritus

HiDHo

Guru

Moonfish

Guru

Underway

Guru

Underway

Guru

Spike

Senior Member

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