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Nocanvas
Senior Member
Hows that it is not in the water It isn't going in the water there
Transient Vessel not registered in any state/USCG Documented
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Hows that it is not in the water It isn't going in the water there
Prudent if it doesn't have a registration from somewhere. Like Comodave said in post #2 you would be ticketed.
I don't know about the state that you're registered in. In WA. that up to 10% value of the boat (no cap) is a sales tax goes to the general fund, it supports things like needle exchanges and homeless camps. The annual registration fee which is .05% of your initial price or what the state decides it should of been (always higher) those monies also go in to the general fund and help support illegal immigration (aprox 1.5 to 2.5 billion annually in WA.)
As far as putting a boat in an LLC to avoid tax at least in WA. only benefits the next buyer. Tax is collected on the property placed in the LLC
I dare say every state has a marine program that one way or another is funded through taxes and fees. The group 4 and 5 owners on BandB's post look for ways to escape any taxation in any state. That leaves the rest of us paying for their privilege (or cleverness, or independence, or thriftiness if you ask them).
Can't comment on Washington LLC laws. But former Senator John Kerry obviously found a tax advantage in a state other than his own. And then he got caught.
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twistedtree
Guru
But the question still stands. Where should I have registered, if not my state of residence, and why there versus some other place? How much should I have paid, and where, to meet your barometer? I lived in New Hampshire for many years and never paid any sales tax or income tax, because there is none. Was it then unethical for me to travel to other states and utilize services as a visitor?
Alaskan Sea-Duction
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Well not all of WA. There are a lot of those that live outside King County that would like to put a cap on it. But then again what ever King County wants, King County gets....
ksanders
Moderator Emeritus
When a transient boater visits a state they help the economy and citizens of that state by spending money there. Money at marinas, money at fuel docks, money at resturauants, money at boat yards, money spent shoping. That money provides jobs.
I for example will do anything to avoid paying 8-10% of my boats value to the state of Washington, so that I can have the privledge of spending my hard earned money there. It’s simple, Move on, and go spend money in a state that apreciates what I bring to it’s citizens.
If I decide to call Washington home, then paying resident taxes is part of the deal.
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Doubtful you were a full time transient when you lived in New Hampshire. You stated in an earlier post, there's nothing stopping you from registering in your home state and paying the tax....and added but why would I do that. Why not? (Rhetorical question) You have to meet your own barometer.
I just checked my 2018 state of WA registration. I had just bought the boat, so the excise tax will be very accurate. It is 1/2 of 1 percent of the value, which was the purchase price. Today I renewed my registration, and the total registration decreased by $250.
I hope this clears up any confusion!
I hope this clears up any confusion!
FF
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TAX EVASION is a crime.
TAX AVOIDANCE is good citizenship.
"You're OK with taking advantage of what other boaters pay to support the marine infrastructure."
The lies come from the folks that collect "gas or road Taxes" and then pervert the tax cash into "transportation funding ", and we get light rail , buses ,sub$adi$ed commuter trains and unwanted high speed rail, ,that goes nowhere at monster cost..
I would love to learn where boaters payments support the instate "marine infrastructure."
TAX AVOIDANCE is good citizenship.
"You're OK with taking advantage of what other boaters pay to support the marine infrastructure."
The lies come from the folks that collect "gas or road Taxes" and then pervert the tax cash into "transportation funding ", and we get light rail , buses ,sub$adi$ed commuter trains and unwanted high speed rail, ,that goes nowhere at monster cost..
I would love to learn where boaters payments support the instate "marine infrastructure."
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Bare Necessities
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- 1989 Carver Californian 48' ACMY
It is hard to read extended post like this one without forming or having an opinion of: this sounds like someone asking how is the best way for me to cheat and avoid paying my fair share to use the beautiful waterways and let everyone else pay so I can sponge it all up.
First of all; I take every legal deduction available. I have a documented boat but I also report it to my state (KY) and yes I pay assessed property value taxes to the county where I keep the boat (not where I live). It is not that expensive and I can hold my head high when someone is snooping around looking for tax evaders. I really considered deleting this before posting but you know what they say, it is only my opinion. If there were not so many tax evaders, who knows, maybe all of our tax burdens would be less.
First of all; I take every legal deduction available. I have a documented boat but I also report it to my state (KY) and yes I pay assessed property value taxes to the county where I keep the boat (not where I live). It is not that expensive and I can hold my head high when someone is snooping around looking for tax evaders. I really considered deleting this before posting but you know what they say, it is only my opinion. If there were not so many tax evaders, who knows, maybe all of our tax burdens would be less.
twistedtree
Guru
I tend to agree. If the real gripe is whether I've paid my fair share in taxes, what ever that is, I'm pretty darn sure I have. So you (not you FF, but the general "you") can forget about that argument.
twistedtree
Guru
But I AM registered in my home state. My home state says Document or State sticker and bow numbers, but not both. I am documented.
But I DID pay the tax. $0 is due, so that's what I paid.
ksanders
Moderator Emeritus
Guys, someones “fair share” of taxes is what is legally necessary.
If there is a legal means of avoiding taxes, then well, it’s legal.
Like Twistedtree I live in a state that does not have a sales or use tax, nor a boat registration tax. I pay property tax, but once I retire (very shortly now) I will leave my home port and not pay property tax here anymore.
It is not illegal, or immoral, to structure your cruising (or any other aspect of your life) to minimize your tax burden legally. If that means choosing to leave one state just prior to a trigger date then so be it. If that means forming a LLC, or what ever other legal means to avoid taxes, then that is fantastic.
Businesses, and individuals make decisions based on the tax ramifications all the time, and boat related decisions based on taxes are no different.
If there is a legal means of avoiding taxes, then well, it’s legal.
Like Twistedtree I live in a state that does not have a sales or use tax, nor a boat registration tax. I pay property tax, but once I retire (very shortly now) I will leave my home port and not pay property tax here anymore.
It is not illegal, or immoral, to structure your cruising (or any other aspect of your life) to minimize your tax burden legally. If that means choosing to leave one state just prior to a trigger date then so be it. If that means forming a LLC, or what ever other legal means to avoid taxes, then that is fantastic.
Businesses, and individuals make decisions based on the tax ramifications all the time, and boat related decisions based on taxes are no different.
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Not exactly. You are not "Registered" in your home state. You have "met all legal registration requirements" of your home state.
But you would have done that anyway since your boat has never been to MA so never required to be registered there. That brings us to another point. Your personal state of residence really has nothing to do with the question being discussed. We registered in FL because that was going to be the principal place of use of our boat and we were just transporting it to FL.
Now each state's law is worded slightly different. Since you mentioned Washington, theirs reads
Boaters visiting Washington may recreate on state waters for up to 60 days without a permit as long as the vessel is registered in another state or has current U.S. Coast Guard documentation. If you plan to be on Washington waters longer, apply for a permit on or before the 60th day of your visit. To get a permit, visit any vehicle licensing office and bring your unexpired state vessel registration and identification from your state. You may renew the permit once for an additional 60 days. When the renewed permit expires, you must either register your boat in Washington or remove your boat from Washington waters.
So, as long as you don't stay there over 60 days or get a permit within 60 days, you're ok with them. However, Michigan reads "Watercraft registered in another state and used only temporarily in Michigan." Were you to go to Michigan you wouldn't meet that. Georgia reads "If a boat is fully registered and valid in another state, the boat may be used in Georgia. However, after 60 days of continuous use in Georgia, the boat must have Georgia registration." You wouldn't meet that.
Now, I would argue with you had your boat actually been to MA that you clearly met the intent of the laws of Michigan and Georgia. However, since your boat didn't go to MA, I'd argue the first state it hit was California and that since California does not require registration of boats that are documented, you met their registration requirement.
Clearly though I have far more information about you and your boat than the wildlife agent in any of these states. They are either going to give you credit for meeting the intent of the law or not. I would expect you never to be ticketed, but if you cruised in some new areas for extended times you might be. If you were ticketed in GA, you'd have to decide how much time and money to spend to avoid the $210 registration fee.
That is just the issue of registration. Sales Tax is an entirely different issue. I don't think very many people ever go through much effort to avoid registering a boat. They do things to avoid sales tax and property tax.
Who said anyone was not playing by the rules?
Let me ask you a question... when was the last time you sent a check to a state that you patronized on the water where you weren't registered?
What state is your boat used and registered in?
The Washington regulations summarized (not quoted!) above are a good example. One agency in WA interprets it as meaning you need a permit on the 60th day after you first enter the state. However that is not what the statute actually says, and is in fact considerably more ambiguous.
"Paying your share" is a favorite term of some. What is "my share"? If I am in WA 60 days out of 365, should I pay the same as someone there 365? If I visit 10 states in one year is my share 10x that of someone staying in one state? If I store my boat in a dry storage yard for a year in WA, am I using any of the boating infrastructure of the state?
"Fair" itself is an interesting term in taxation. Everyone has a different opinion on what it means. "Legal" is a lot better defined. If I need to give WA 10% of the boat's value to stay 61 days to be "fair", then surely "fair" would have someone there all year giving 60% of the value, as they are there 6 times as long. "Fair" can be a very slippery slope.
"Paying your share" is a favorite term of some. What is "my share"? If I am in WA 60 days out of 365, should I pay the same as someone there 365? If I visit 10 states in one year is my share 10x that of someone staying in one state? If I store my boat in a dry storage yard for a year in WA, am I using any of the boating infrastructure of the state?
"Fair" itself is an interesting term in taxation. Everyone has a different opinion on what it means. "Legal" is a lot better defined. If I need to give WA 10% of the boat's value to stay 61 days to be "fair", then surely "fair" would have someone there all year giving 60% of the value, as they are there 6 times as long. "Fair" can be a very slippery slope.
John Kerry and his LLC scheme in another state was practicing TAX AVOIDANCE....until he got caught. These endless cruising schemes are sailing down the same lane. Matter of time.
Check out how the State of Michigan uses boater fees. The (partially) state funded marina network is an example.
If Kerry got "caught" I doubt it was tax avoidance.....
Do you have a link to how Michigan does things? Thx.
Mikala
Senior Member
If you Google "Harbors of Refuge" (I think it's under DNR) you can get the background on how the state got in the marina business. The initial intent has been bastardized a bit over the years, but it's still a great model.
twistedtree
Guru
This is the quibble I have, and it is indeed unclear.
A number of states say they welcome visitors if they are "registered" in another state. My quibble is with what "registered" means.
A number of people, I think you included, interpret that as meaning that the boat needs to have some sort of registration certificate or decal from another state. It's an understandable interpretation, but what happens when the visitor's home state doesn't provide state certificates or decals for documented boats? It's not just that I didn't have one. MA won't give you one. None of my documented boats have had a registration, and if you ask for one they will tell you to go away. Are those boats not welcome to visit other states? I think you are saying they need to go get a certificate or decal from some state, somewhere, to be welcome. So what state? Do I just pick one at random? Do I register (and pay taxes) in the first state I enter that does issue certificates for documented boats?
I interpret it differently, and I suspect others from states that don't register documented boats feel similarly. I interpret the "registered in another state" requirement to mean that you are in compliance with that state's boat registration laws. In a number of states, that means documentation is all you need. In other states you also need to get a certificate and decal. So there are lots and lots of boats from California, Alaska, Massachusetts, and probably other states that are properly registered according to their state's laws, but do not hold a state registration certificate as boats do in other states. It seems unreasonable to me that all those boats should be unwelcome in other states without registering there first, even if they are just passing through. It seems unreasonable for any state to stipulate what another state's registration requirements should be, or that they need to issue certificates.
I tested my interpretation in WA and it was accepted, but that's the only place I've been asked about it or challenged. And I've cruised through a lot of states, as have many other boats registered the same way.
twistedtree
Guru
BTW, the Kerry thing was never determined to be illegal or evasion. In fact, it was probably completely legal since the LLC owned the boat, and was an RI entity. The Supreme Court's decision about legal entities only further reinforces it. Kerry paid because the optics were bad, and he didn't want to be perceived as trying to cheat his home state.
I'm pretty sure Massachusetts and the other states who don't issue registration stickers for documented boats can be convinced that they need to get aligned with other states. Heck, this thread should be enough by itself. The additional revenue should make it a no brainer. Consider it done.
twistedtree
Guru
But as B&B pointed out, this is about registration, not tax triggers or tax revenue. I have always paid whatever MA tax has been due on my boats. MA has tax triggers on Documented boats too, even though they don't register them.
Not having a state registration DOES NOT MEAN you have not paid whatever taxes are due. It just means the state doesn't issue registration paperwork for documented boats.
And if you do have a state registration certificate, it similarly does not mean that you HAVE paid any taxes.
A registration is not a tax receipt, at least not in some states. Maybe this is where a lot of the confusion comes from.
Speaking of confusion, this quote from post #55 says you didn't pay Massachusetts tax on your Nordhavn....
"My boat was an example. I was properly registered in my state of residency, fondly known as Taxachessets. But taxes were'd due until/unless I brought the boat into the state, which never happened. We cruised our cruising plan moving around the west coast of NA, complying with all the local regs as visitors. Only once were our movements influenced by taxes, and that was when it became clear that it was unclear whether I was about to owe $200,000 to WA. So I cleared that up by moving to Vancouver."
No. This is a quote from a MA newspaper. He took the boat to Nantucket for an extended period and broke the law. Sound familiar?
"Isabel got Kerry into hot water when media reports revealed he and his wife skirted a $437,500 Massachusetts state tax bill by keeping the yacht in Newport. Rhode Island repealed its boat use and sales tax in 1993 and has become a sort of haven for luxury yachts, according to the Herald.
But Kerry took the boat to Nantucket and Massachusetts tax laws stipulate that boats used there are subject to state boat use tax equal to the sales tax, so the secretary eventually capitulated and wrote the Massachusetts Department of Revenue a check."
No, Washington's law reads differently. You're clearly ok there. Only two states I've known people to encounter issues in are Michigan and Georgia.
This thread is getting confusing... but interesting....
I have no clue if Kerry way avoiding taxes or doing tax evasion..... One is legal and one not. Doesn't make any difference if he paid the tax to help with his image. If he broke the law then he should be punished, and if he didn't, he should not, period.
I think we can all agree that a prudent person would plan to minimize his tax burden within the law. And that's not only their right, it's a smart thing to do.
There's been a number of post about "fair share" and that's totally impossible to determine and totally inappropriate to chastise one because they didn't pay their fair share when we just don't know what it is. And if a person is in a lower tax bracket does that mean they didn't pay their fair share?
And if you want to write a check to your state to support whatever, that's fine for you. However, no reason someone else has to do the same or is a lesser person for NOT writing the check.
I could strongly argue that the majority of tax dollars we pay are wasted because politicians just don't know how to handle money. So, I'd support the guy that can figure out how to legally NOT pay taxes. And I could argue to support grass root operations that help support the local things that you like... NOT the government.
And if a state INVITES you to their state, I see NO reason that you can't go their and enjoy the benefits without feeling obligated to pay an additional tax OR pay some registration tax in ANY state if it is not required.
I have no clue if Kerry way avoiding taxes or doing tax evasion..... One is legal and one not. Doesn't make any difference if he paid the tax to help with his image. If he broke the law then he should be punished, and if he didn't, he should not, period.
I think we can all agree that a prudent person would plan to minimize his tax burden within the law. And that's not only their right, it's a smart thing to do.
There's been a number of post about "fair share" and that's totally impossible to determine and totally inappropriate to chastise one because they didn't pay their fair share when we just don't know what it is. And if a person is in a lower tax bracket does that mean they didn't pay their fair share?
And if you want to write a check to your state to support whatever, that's fine for you. However, no reason someone else has to do the same or is a lesser person for NOT writing the check.
I could strongly argue that the majority of tax dollars we pay are wasted because politicians just don't know how to handle money. So, I'd support the guy that can figure out how to legally NOT pay taxes. And I could argue to support grass root operations that help support the local things that you like... NOT the government.
And if a state INVITES you to their state, I see NO reason that you can't go their and enjoy the benefits without feeling obligated to pay an additional tax OR pay some registration tax in ANY state if it is not required.
Alaskan Sea-Duction
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