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bligh 07-31-2020 04:30 PM

Buying an LLC
 
Hey all, as you know I am in contract to buy a boat. But the boat is in an LLC so apparently I am in contract to buy an LLC that owns a boat. I dont think the broker has any clue what to do. I know that the boat is in a Delaware corporation. But that is all I know. Can anyone steer me in th right direction so I am informed as to what procedures I need to take and what documents I need to sign, have signed , and file and with what entity to file?

:)

Comodave 07-31-2020 04:37 PM

Get a lawyer that knows maritime law and whatever state you are going to keep the boat. You may have a chance to not pay sales tax so it can be important that you handle it correctly. Good luck.

DavidM 07-31-2020 04:49 PM

Quote:

Originally Posted by Comodave (Post 906414)
Get a lawyer that knows maritime law and whatever state you are going to keep the boat. You may have a chance to not pay sales tax so it can be important that you handle it correctly. Good luck.

:iagree: David

caltexflanc 07-31-2020 05:00 PM

You are in a contract to buy a boat from an LLC. Not the LLC itself. If your contract reads otherwise, get the broker to straighten that out.

bligh 07-31-2020 05:22 PM

Quote:

Originally Posted by Comodave (Post 906414)
Get a lawyer that knows maritime law and whatever state you are going to keep the boat. You may have a chance to not pay sales tax so it can be important that you handle it correctly. Good luck.


Have you actually done this before?

Russell Clifton 07-31-2020 05:32 PM

I have done it. You do not need to buy the LLC. The boat is just a asset of the LLC and you are buying the boat. If you decide to buy both I would for sure consult with a lawyer familiar with maritime law.

Caphenning 07-31-2020 05:35 PM

Quote:

Originally Posted by bligh (Post 906410)
Hey all, as you know I am in contract to buy a boat. But the boat is in an LLC so apparently I am in contract to buy an LLC that owns a boat. I dont think the broker has any clue what to do. I know that the boat is in a Delaware corporation. But that is all I know. Can anyone steer me in th right direction so I am informed as to what procedures I need to take and what documents I need to sign, have signed , and file and with what entity to file?

:)

Do not accept those terms under any condition as you will be assuming all past liabilities of that LLC and you have no idea what they are. You need to be in a contract to buy the vessel from an LLC, and for that I would go through a title insurance company to handle the closing.

bligh 07-31-2020 05:43 PM

Quote:

Originally Posted by Russell Clifton (Post 906442)
I have done it. You do not need to buy the LLC. The boat is just a asset of the LLC and you are buying the boat. If you decide to buy both I would for sure consult with a lawyer familiar with maritime law.


I do need to buy the LLC. If I buy the LLC , then I avoid CA sales tax (8%).

Caphenning 07-31-2020 05:53 PM

Quote:

Originally Posted by bligh (Post 906448)
I do need to buy the LLC. If I buy the LLC , then I avoid CA sales tax (8%).

You are taking a big risk by doing so, you don’t know what the LLC liabilities are. Your required due diligence to assure that there isn’t a million dollar lawsuit hiding in the closet and insuring against it is going to cost you more than the tax most likely given the boats you’re looking at. Better to form a new LLC to buy the old one, this gives you a corporate shield that limits your potential personal losses to the boat.

MYTraveler 07-31-2020 05:58 PM

Quote:

Originally Posted by bligh (Post 906448)
I do need to buy the LLC. If I buy the LLC , then I avoid CA sales tax (8%).

Talk to a knowledgeable lawyer. It will not work, very likely you will get caught (though it may take a few years), no statute of limitations will protect you (since you will not have filed a return), so in addition to the tax (and I believe the rate is closer to 10%, but it does vary a little by county), you will have to pay penalties and interest.

caltexflanc 07-31-2020 06:13 PM

I should add, you don't need a maritime lawyer, just a business lawyer. You can get one there in Santa Cruz.

mvweebles 07-31-2020 06:18 PM

As I recall, asking price on this boat was close to $400k. Tax is in the range of $30k. California board of Equalization (the tax authority) is ruthless, and basically compels you to prove you do not owe a tax (vs they proving you do owe the tax).

You need an attorney or specialist on this one. Screw-up and you'll be fighting the State for years. And it won't end well for you. Doubtful there is anyone on any internet forum who can realistically assist. You have stumbled into a 30-year game of cat and mouse.

Good luck. Would appreciate an update on where you land.

Peter

Comodave 07-31-2020 06:46 PM

Quote:

Originally Posted by bligh (Post 906439)
Have you actually done this before?

No, I have not but have seen people get in trouble because they didnít do it right.

bligh 07-31-2020 06:50 PM

Quote:

Originally Posted by mvweebles (Post 906464)
As I recall, asking price on this boat was close to $400k. Tax is in the range of $30k. California board of Equalization (the tax authority) is ruthless, and basically compels you to prove you do not owe a tax (vs they proving you do owe the tax).

You need an attorney or specialist on this one. Screw-up and you'll be fighting the State for years. And it won't end well for you. Doubtful there is anyone on any internet forum who can realistically assist. You have stumbled into a 30-year game of cat and mouse.

Good luck. Would appreciate an update on where you land.

Peter


Technically, the boat will not have a change of ownership. It is owned by a Delaware based LLC. Transfer of ownership of an LLC does not trigger sales tax. Sales tax is triggered when a boat changes ownership.
I agree I need specialist on this one. I was hoping someone could refer me to a lawyer or accountant they have used for the same purpose.

bligh 07-31-2020 07:02 PM

Quote:

Originally Posted by MYTraveler (Post 906457)
Talk to a knowledgeable lawyer. It will not work, very likely you will get caught (though it may take a few years), no statute of limitations will protect you (since you will not have filed a return), so in addition to the tax (and I believe the rate is closer to 10%, but it does vary a little by county), you will have to pay penalties and interest.


What do you mean 'get caught?' I am not doing anything illegal.


If I sell my business, which is a corporation, all the assets go with it, including vehicles that are owned by the corporation (on the title) and the titles of all the vehicles remain the same. None of the vehicles would be subject to sales tax since they would not be transferring ownership.

And I would also expect I would have to file an annual return. If I buy the existing LLC, I expect that I would get all the returns form the past 7 years as well.

SoWhat 07-31-2020 07:15 PM

You can not avoid the CA sales tax simply via an LLC. You would have to certify the vessel was in commercial use such as a charter boat or fishing boat. Now you're playing with fraud charges in addition to penalty and interest charges.
If the boat is used in CA, it must pay sales tax in CA, or qualify for one of the exemptions.

bligh 07-31-2020 07:21 PM

Quote:

Originally Posted by SoWhat (Post 906488)
You can not avoid the CA sales tax simply via an LLC. You would have to certify the vessel was in commercial use such as a charter boat or fishing boat. Now you're playing with fraud charges in addition to penalty and interest charges.
If the boat is used in CA, it must pay sales tax in CA, or qualify for one of the exemptions.


If the boat does not transfer ownership, how can it be subject to sales tax?

syjos 07-31-2020 07:31 PM

Quote:

Originally Posted by Russell Clifton (Post 906442)
I have done it. You do not need to buy the LLC. The boat is just a asset of the LLC and you are buying the boat. If you decide to buy both I would for sure consult with a lawyer familiar with maritime law.


Listen to Russell.

Buy the boat from the LLC as an individual. If you want to own it as a LLC, form another LLC after you buy the boat.

A LLC is just a like a person and sole proprietors and partnerships form it to protect their assets without having to form an actual corporation. I have several LLC's for businesses and other than having to fill out the annual state report and pay the annual fee, not a big deal. And anyone can fill out the online application, pay the fee and form a LLC. It's pretty simple. And the LLC gets treated like a sole proprietorship or partnership by the IRS. I'm not a lawyer.

We don't own our boat under a LLC.

drb1025 07-31-2020 08:02 PM

Contact Wenthur Law Group wenthurlawgroup.com in San Diego. They can assist you with the purchase of an LLC that owns a boat. Nothing illegal about it.

Comodave 07-31-2020 08:06 PM

Quote:

Originally Posted by SoWhat (Post 906488)
You can not avoid the CA sales tax simply via an LLC. You would have to certify the vessel was in commercial use such as a charter boat or fishing boat. Now you're playing with fraud charges in addition to penalty and interest charges.
If the boat is used in CA, it must pay sales tax in CA, or qualify for one of the exemptions.

This is why I said get a lawyer that knows maritime law and is knowledgeable about the sales tax issue. Whatever the lawyer says it will still be you that the BOE comes after and fines. Get one that know what they are doing.

catalinajack 07-31-2020 08:07 PM

Buying an LLC has nothing to do with maritime law. This is just basic commercial law. The boat travels with the corporation as does all of the corporation's assets and it's LIABILITIES. No change of ownership of the boat, no sales tax. But, buy the LLC and you assume responsibility for any and all liabilities, known and unknown. Good luck with that.
Quote:

Originally Posted by DavidM (Post 906425)
:iagree: David


mvweebles 07-31-2020 08:14 PM

Quote:

Originally Posted by catalinajack (Post 906508)
Buying an LLC has nothing to do with maritime law. This is just basic commercial law. The boat travels with the corporation as does all of the corporation's assets and it's LIABILITIES. No change of ownership of the boat, no sales tax. But, buy the LLC and you assume responsibility for any and all liabilities, known and unknown. Good luck with that.

I agree Catalina Jack. It would be like buying a truck or a piece of equipment from a corporation. The difference is that in California, the tax authority is super alert to tax issues related to boats. They have spent over 30 years busting the balls of boat owners, often seeking taxes long after the vessel has left California. Even my measly Willard 36 required some positive proof she'd left California waters for good when I brought her to Mexico 1.5 years ago.

LLC or not, the OP would do well to have a knowledgeable person in his corner. It's super easy if you know where the speedbumps are

Peter

caltexflanc 07-31-2020 08:21 PM

I have used Deborah Malkin in Santa Cruz (Soquel) for various estate and business structure matters. Dmalkin@malkintrust.com (831) 462-9100

If for some reason I can't think of, she won't help you, then I can strongly recommend Kevin McCollough of Spaulding, McCollough and Tansil (SMT) in Santa Rosa, who has done a whole bunch of LLC and tax-related work for us over the course of the last five years.
(707)524-1900 mccllough@smlaw.com

Codger2 07-31-2020 08:44 PM

Quote:

Originally Posted by mvweebles (Post 906512)
LLC or not, the OP would do well to have a knowledgeable person in his corner. It's super easy if you know where the speed bumps are.

Mvweeble's advice is right on the money!

Get a lawyer who specializes in LLCs that own boats. My boat is in an LLC as are dozens & dozens of boats in SoCal. It's done every day down here and as some others have pointed out, it's a piece of cake when a knowledgeable attorney who does this for a living is involved. The attorneys fees down here are approximately
$3K to set up an LLC or transfer one. Most brokers in my area are quite familiar with these transactions & can recommend attorneys.:oldman:

caltexflanc 07-31-2020 08:53 PM

A boat is simply an asset of an LLC, no different than pieces of real estate or a car collection or works of art.

syjos 07-31-2020 09:03 PM

An attorney is an unnecessary expense. They will overly complicate the deal, which will result in more money spent. A LLC is technically not a corporation. It's a Limited Liability Company. It's used mostly to separate assets to protect them from liability. It is simple compared to a C or S corporation.

Treat the LLC as a person and buy just the boat from it.

Jeez, it's not a big deal. I formed several LLC's, buy and sell personal and real property belonging to the LLC and so far in over 35 years, have never consulted an attorney pertaining to the LLC or wished I had. The cost in Washington to form a LLC is $180 and $60 annual renewal.

Difficulty arises when sales tax avoidance is the goal.

There are so many online sources for LLC information and the Secreatary of State for your state should also have help available.

mvweebles 07-31-2020 09:04 PM

Quote:

Originally Posted by caltexflanc (Post 906530)
A boat is simply an asset of an LLC, no different than pieces of real estate or a car collection or works of art.

Normally I'd agree, but with all due respect, there are certain assets in California that draw a lot of unwanted attention. A boat is one of them.

Codger2 07-31-2020 09:12 PM

Quote:

Originally Posted by syjos (Post 906532)
An attorney is an unnecessary expense.................. Treat the LLC as a person and buy just the boat. .

Not something I'd want to do!The OP is in California. Hiring an attorney to transfer the LLC is cheap compared to the tax you will pay if just purchasing the LLC's asset.

Comodave 07-31-2020 10:25 PM

Quote:

Originally Posted by syjos (Post 906532)
An attorney is an unnecessary expense. They will overly complicate the deal, which will result in more money spent. A LLC is technically not a corporation. It's a Limited Liability Company. It's used mostly to separate assets to protect them from liability. It is simple compared to a C or S corporation.

Treat the LLC as a person and buy just the boat from it.

Jeez, it's not a big deal. I formed several LLC's, buy and sell personal and real property belonging to the LLC and so far in over 35 years, have never consulted an attorney pertaining to the LLC or wished I had. The cost in Washington to form a LLC is $180 and $60 annual renewal.

Difficulty arises when sales tax avoidance is the goal.

There are so many online sources for LLC information and the Secreatary of State for your state should also have help available.


Have you ever dealt with California BOE? They are something else. You had better have your ducks in a row before they come after you. I bought a boat in Washington State and later ran it to California. I finally convinced them that I didnít owe California sales tax so they contacted Arizona and told them to go after me since the boat was home ported in Tucson, even though the boat never entered Arizona. If I were doing this purchase I would get an attorney that has extensive boat experience. Period.

Beaverlake 07-31-2020 11:49 PM

Purchasing an LLC to acquire a boat is not voodoo. It is a normal practice in states like CA and WA. There is good advice about getting a competent experienced attorney to make sure you arenít assuming nasty liabilities. This is no illegal dodge or anything close. We investigated a boat in WA and a boat in CA along the last purchase path. Both were LLC owned. We ended up passing on the boats but not because of the LLC issue. We should not be giving advice beyond ďget an experienced attorneyĒ unless one of us has direct experience purchasing a Delaware LLC in CA as part of the process to acquire its assets (i.e., a boat).

guy with a boat 08-01-2020 12:04 AM

Quote:

Originally Posted by syjos (Post 906532)
An attorney is an unnecessary expense. They will overly complicate the deal, which will result in more money spent. A LLC is technically not a corporation. It's a Limited Liability Company. It's used mostly to separate assets to protect them from liability. It is simple compared to a C or S corporation.

Treat the LLC as a person and buy just the boat from it.

Jeez, it's not a big deal. I formed several LLC's, buy and sell personal and real property belonging to the LLC and so far in over 35 years, have never consulted an attorney pertaining to the LLC or wished I had. The cost in Washington to form a LLC is $180 and $60 annual renewal.

Difficulty arises when sales tax avoidance is the goal.

There are so many online sources for LLC information and the Secreatary of State for your state should also have help available.

Sometimes trying to save money by not hiring a pro is actually far more expensive. This is one of those times.

Soo-Valley 08-01-2020 12:16 AM

Why was the boat owned by an LLC comes to mind? Tax benefit? Capital gains/loses?
What if you buy the LLC at market value of the boat that was depreciated for tax savings, are you liable for repaying the difference? Does the LLC have debt that you inherit?

Sure a lawyer may weed this out, but it would be easier to buy the boat from the LLC, pay the sales tax and not have to look over your shoulder.
Mind you if there is a lien on the chattel (boat) then that has to be cleared.

guy with a boat 08-01-2020 12:17 AM

Bligh,
There are absolutely safe and legal tax management strategies available that will make a sizable difference in your tax bill. Consult with an attorney (Wenthur is great) as early in the deal as possible. There is no need to incur great expense or take on mysterious liabilities.
It’s amazing how much BS is posted in these LLC threads. I don’t know if people just repeat it from reading it somewhere else on the internet, or if they hear it on the docks. Regardless of the source, much of it is bad info.
I don’t claim to be an expert, but I’m smart enough to hire one. I do own and have owned quite a few LLC’s and have bought and sold them, with and without boats involved, and I am a long-time California resident. Just know the laws and follow them. California (and other) tax authorities are tough but follow the law and you can minimize taxes and still sleep like a baby.

BruceK 08-01-2020 12:48 AM

Unless it`s different there, you don`t "buy" a corporation. It is a legal entity,in the same way as a person is a legal entity. It exists separate and apart from those with an "interest" in it.
You buy the issued shares(stock I think you call it) from the existing holders. The existing company officers resign and you and or nominees take on the roles. That way, you own the shares and gain control.
The Corporation owns what it owns, owes what it owes, comes with its history which may be good or frankly alarming. And hopefully indemnities from actual people you can recover from if it`s not all as claimed.
You definitely need legal advice.It`s an area fraught with risk. Probably all is well, but it needs to be approached carefully by knowledgeable people.

Comodave 08-01-2020 01:33 AM

I am not saying, or do I think that anyone was saying it is a tax dodge. Only thing I am saying is make sure you do it correctly and it is very easy not to do it correctly and incur tax and penalties. Just get a good lawyer. It will be worth it.

PPandE 08-01-2020 06:22 AM

Iíve done it both ways, with both boats and planes. I recently sold an LLC whose only assets were a plane and a checking account. Transferred the stock, no taxes. I also owned another LLC which owned a boat as well as other assets. The LLC sold the boat resulting in the buyer paying taxes.

Get a business savvy lawyer. Yesterday.

caltexflanc 08-01-2020 06:55 AM

Quote:

Originally Posted by mvweebles (Post 906536)
Normally I'd agree, but with all due respect, there are certain assets in California that draw a lot of unwanted attention. A boat is one of them.

Let me assure you, after plenty of direct experience, there is NO asset that doesn't get the attention of California tax authorities.

psneeld 08-01-2020 07:05 AM

I have read at least one case where an LLC formed to protect ONLY a boat used solely by the owner for pleasure was actually "tax evasion" and was subsequently taxed the moment the boat entered the state.

I dont know as much as many here, but I would be leaning towards a tax attorney more than anyone. LLCs for boats, RVs and planes are pretty common ( a real cottage industry in some states) and depending on what tha states tax divisons think at the time might be the most useful.

Legal and tax advice from forums seems to be one of the most confusing topics and hard to sift out what really applies in your case.

One common thought is...just because it works for one person doesnt mean it will work for you.

Art 08-01-2020 08:15 AM

Bligh - I recommend... Get a knowledgeable attorney.

From what I understand the boat price is in the $400K range. If you spend $4K on an attorney... that 1% cost for "legal" financial safety is a bargain! And, if the LLC has next to no background needing research the lawyer cost may be even more affordable.

I have owned a C corp in CA. I own an LLC in DE. And, a sole proprietorship in CA.

If you want to play in and go through "tax hell"... then, the "CA State Board of Equalization" is the operation to get into conflict with; their lawyers are treacherous, and, love to be thought of as such.

Good luck!

Codger2 08-01-2020 09:36 AM

Quote:

Originally Posted by guy with a boat (Post 906608)
Itís amazing how much BS is posted in these LLC threads. I donít know if people just repeat it from reading it somewhere else on the internet, or if they hear it on the docks. Regardless of the source, much of it is bad info.

Thanks for having the guts for your post! I was thinking the same thing but lacked the fortitude to say it in a post. :thumb:

Woodland Hills 08-01-2020 09:47 AM

Wow! So much misinformation.......

We bought the LLC that owned our boat a few years ago with no issues whatsoever. Just get a good attorney to draw up the papers and have the seller indemnify you for any outstanding debts that the LLC might have.

There will be no use or sales tax owed since the ownership of the boat will not change: itís still owned by the same LLC. This is the same whether the boat is recreational or commercial.

There is nothing scammy or sketchy about this, it happens every day when a business is sold: buy a plumbing company owned by an LLC and the service trucks come with the business without owing sales tax on them. This is all routine in the business world: tax avoidance, not evasion. All perfectly legal and it will help you when you eventually sell the LLC and itís assets since the next owner will save the tax too.

psneeld 08-01-2020 10:17 AM

And one more post saying it is OK could just as well be misinformation...


At least a lawyer has insurance to cover mistakes over advice on the internet.


The research that I have done all warns that LLCs to buy individual assets that are not held for increased valuement or any sort of business is sometimes seen by courts as "solely avoiding" liability and or taxes an does not afford the owner protection.


Now if done differently, different story.


At least research the crap out of it if you don't get an attorney....well beyond this thread.

Art 08-01-2020 11:27 AM

Quote:

Originally Posted by Woodland Hills (Post 906703)
Wow! So much misinformation.......

We bought the LLC that owned our boat a few years ago with no issues whatsoever. Just get a good attorney to draw up the papers and have the seller indemnify you for any outstanding debts that the LLC might have.

There will be no use or sales tax owed since the ownership of the boat will not change: itís still owned by the same LLC. This is the same whether the boat is recreational or commercial.

There is nothing scammy or sketchy about this, it happens every day when a business is sold: buy a plumbing company owned by an LLC and the service trucks come with the business without owing sales tax on them. This is all routine in the business world: tax avoidance, not evasion. All perfectly legal and it will help you when you eventually sell the LLC and itís assets since the next owner will save the tax too.

Not myself being a lawyer... but knowing some of the pitfalls that Bligh might face:

Your input regarding the trucks "being used" as business income producing entities would therefore be a well functioning portion of the LLC and therein tax exempt from, during and after purchase of the business.

However... in this case being discussed: if the PO of the boat set up an LLC specifically and only to best as possible skirt tax or other costs regarding the boat, without "truly" using the boat as a functioning portion of the business... could create considerable conflict with state tax authorities.

That is just another penny of my two cents. Again, I recommend to Bligh - Get a competent lawyer involved!

Woodland Hills 08-01-2020 11:32 AM

You could always call the State Board of Equalization or whatever the local taxing agency is called and ask them directly. I did in Florida and was transferred to the actual head of the agency in Tallahassee, who answered all my questions. I was told that the use of an LLC was “a well-known loophole” and was routine and legal.

SoWhat 08-01-2020 11:52 AM

I am reminded of MA Senator Kerry's attempt to claim his yacht was registered and docked in tax free Rhode Island when in fact it was docked at Nantucket all summer. $7Mil boat, owned by a PA LLC. He paid the $437K MA tax and annual $70K excise tax.

There is a difference between selling an actual business and a tax avoidance scheme.

MYTraveler 08-01-2020 12:05 PM

Quote:

Originally Posted by bligh (Post 906475)
Technically, the boat will not have a change of ownership. It is owned by a Delaware based LLC. Transfer of ownership of an LLC does not trigger sales tax. Sales tax is triggered when a boat changes ownership.

As logical as your intuition may be, California's law sees right through that. It deems the transfer of a majority interest in an LLC as a transfer of its assets, thereby triggering tax just as if the boat were sold directly.

Russell Clifton 08-01-2020 12:11 PM

[QUOTE=Art;906739]Not myself being a lawyer... but knowing some of the pitfalls that Bligh might face:
However... in this case being discussed: if the PO of the boat set up an LLC specifically and only to best as possible skirt tax or other costs regarding the boat, without "truly" using the boat as a functioning portion of the business... could create considerable conflict with state tax authorities.

I was told by a lawyer who specialized in maritime law almost that exact same thing. His advice was to buy just the boat, pay the tax, and sleep better at night. That's what I did.

Woodland Hills 08-01-2020 12:13 PM

Quote:

Originally Posted by SoWhat (Post 906745)
I am reminded of MA Senator Kerry's attempt to claim his yacht was registered and docked in tax free Rhode Island when in fact it was docked at Nantucket all summer. $7Mil boat, owned by a PA LLC. He paid the $437K MA tax and annual $70K excise tax.

There is a difference between selling an actual business and a tax avoidance scheme.

Tax avoidance is fully legal in all 50 states, tax evasion is not. One is under no obligation to pay one cent more in taxes than what is owed.

You example has nothing to do with buying an LLC whose sole asset is a boat, instead it is a dispute over state of residency and taxes owed as a result. This is a completely different matter and is governed by a different set of statutes and regulations.

All the forum “experts” can pontificate all they want, but having been through the process of buying a Delaware LLC, I know that this is a fully above board, completely legal process that saved us $24,000. And that in over two years, there have been no liens or outstanding debts connected with the LLC. Just do your due diligence.......like any other large purchase.

Woodland Hills 08-01-2020 12:17 PM

[QUOTE=Russell Clifton;906750]
Quote:

Originally Posted by Art (Post 906739)
Not myself being a lawyer... but knowing some of the pitfalls that Bligh might face:
However... in this case being discussed: if the PO of the boat set up an LLC specifically and only to best as possible skirt tax or other costs regarding the boat, without "truly" using the boat as a functioning portion of the business... could create considerable conflict with state tax authorities.

I was told by a lawyer who specialized in maritime law almost that exact same thing. His advice was to buy just the boat, pay the tax, and sleep better at night. That's what I did.

Too bad you didnít consult a tax lawyer instead...... asking a maritime attorney about tax law is like asking your cardiologist about that ingrown toenail thatís been bugging you.

mvweebles 08-01-2020 12:33 PM

[QUOTE=Woodland Hills;906754]
Quote:

Originally Posted by Russell Clifton (Post 906750)

Too bad you didnít consult a tax lawyer instead...... asking a maritime attorney about tax law is like asking your cardiologist about that ingrown toenail thatís been bugging you.

........ or asking people in Florida for advice about taxes in California is like the cardiologist/ingrown toenail.

Im not sure how this thread took a turn towards nefarious tax avoidance. My recommendation to consult a skilled expert was because the path to taxation in California is complicated, LLC or not. The liability can exceed the actual sales tax due as the same folks also deal with annual property tax of the boat and the slip where it resides (the so called shadow tax - the land beneath your boat).

Most states, you pay the sales tax and you move on with your life which is also true in California. Unfortunately. That's not the only tax you will be liable for during ownership. I suspect it's not that complicated for knowledgeable persons. But God forbid of you run afoul.

Peter


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