How do I know if my vessel must be registered in Maryland?
Your vessel, whether commercial or recreational, must be registered in Maryland if it is:
Equipped with any kind of primary or auxiliary mechanical propulsion; and
Used in Maryland most in a calendar year.
Note: US Coast Guard documented vessels using Maryland waters are NOT exempt from the vessel excise tax. When used principally in Maryland, documented vessels must display a documented use decal.
If your vessel was purchased in Maryland and will use Maryland waters a majority of the calendar year, you are liable for vessel excise tax and must register the vessel within 30 days of purchase to avoid assessment of penalty and interest.
If your vessel was purchased elsewhere or previously registered in another jurisdiction, is now in Maryland waters, and will use Maryland waters more than any other single jurisdiction during the calendar year, you are liable for vessel excise tax and must register the vessel within 30 days of entering Maryland waters.
If your vessel is duly registered in another jurisdiction but remains in Maryland waters more than 90 days in a calendar year, you may be liable for vessel excise tax unless you can prove principal use in another jurisdiction.
What is "principal use?"
8-701(p) of the State Boat Act
State of principal use means the jurisdiction on whose waters a vessel is used or to be used most during a calendar year, which is the period from January 1 through December 31.
Use means to operate, navigate, or employ a vessel. A vessel is in use whenever it is upon the water, whether it is moving, anchored, or tied up to any manner of dock or buoy. A vessel is also in use if it is kept in any structure in readiness for use.
When must I apply?
Vessel excise tax must be paid within 30 days of Maryland tax liability to avoid the assessment of penalty (10% of vessel excise tax due) and interest (1.5% per month).
Vessel in Disrepair at time of Purchase
If you are given a boat because it is no longer operational or is in very poor condition, or the purchase price is much lower than fair market value because of the boats current condition, be sure to title the boat in your name within 30 days of purchase. Refer to the What documents will I need? section on this webpage to ensure you have all of the required documents. The certified bill of sale should detail the condition of the boat and list the items that are not operational on the vessel. Photographs of the poor vessel condition may be required to confirm a much lower Fair Market Value. If you wait to title until work on the vessel is completed, vessel excise tax will be assessed against the higher value of the restored boat.
