Sales tax and boat registration question

[QC]

Re: Sales tax and boat registration question

My boat stays in AZ and is primarily used in AZ waters. AZ has no private party sales tax. Not avoidance, it's the law there and includes cars.

I also agree with DuckHunterJon in principle, so call me inconsistent.

 

[riptide09]

Re: Sales tax and boat registration question

In MA you pay the sales tax when you register the boat with the Environmental Police. If you never register the boat in MA, you are not required to pay sales tax. You will not be billed excise by your town because it is not registered in your town.

The excise tax on boats in MA is not that simple. You pay excise tax to the town where the boat is berthed, not the town where you live or the town of the boat registration. So that means your boat has to be sitting in a slip someplace to pay excise tax.

If the boat is sitting on a trailer all the time except when it is being used, there is no excise tax. I called both the state and my local town to verify this information. I have never paid excise tax on my boat however I do pay excise tax on the trailer which is paid to the town the trailer is registered in.

As previously stated, in MA you do not pay sales tax on a boat, including PWC, until you register it. At the time of registration you pay sales tax on the web, print out the receipt and take it with you to register the boat. You will be hit up for the price of registration and title.

 

[MrBigStuff]

Re: Sales tax and boat registration question

Some really misinformed people here.

You're supposed to pay the SALES tax within a certain period after buying the boat. They will tack on a penalty if you exceed the grace period. You don't even pay the SALES tax at the place you have to go to register it. It's at a separate building where they collect SALES tax and record that you paid it. You can also submit payment of your tax online and get a receipt. Then you go to the building to register your boat and they check to make sure you have a receipt for your SALES tax before they will issue you a valid registration. Only someone who has never gone down to register a boat in Boston wouldn't know this procedure. It's a PITA.

I have 4 boats. One reg'd in MA, two in NH, one in ME. Paid sales tax to MA on all of them as I live in MA.

When you buy goods online and live in MA, you're supposed to pay USE TAX on those purchases. There's a tax form specifically for this purpose. Naturally, if you never report the purchase, it's hard to enforce. But ask the people who bought tires at Town Fair Tire in NH if they were sweating bullets a few months back when MA took TFT to court over it. Fortunately, the courts ruled in TFT's favor and we get a brief respit.

So, just because you bought your boat in NH and trailer it to the lake does not mean you don't owe any MA SALES tax on it if you live here. The name is pretty self explanatory in case you are having trouble understanding its purpose.

As noted, the trailer is taxed separately as a licensed for the road vehicle and the town where it is kept demands excise taxes on it.

 

[riptide09]

Re: Sales tax and boat registration question

So, just because you bought your boat in NH and trailer it to the lake does not mean you don't owe any MA SALES tax on it if you live here. The name is pretty self explanatory in case you are having trouble understanding its purpose.

The tax status directly depends on if the boat is brought into the state of MA in the first 6 months of ownership.

From MA Tax code:

Sales where the purchaser accepts title to and possession of an item outside Massachusetts generally are exempt. Similarly, if a vendor is obligated to deliver to an out-of-state purchaser?s address or to an interstate common carrier for such a delivery, the sale is not taxable in Massachusetts. Generally, however, any taxable item brought into the state within six months of purchase for use, storage or consumption in Massachusetts s subject to the use tax.

So I would say if I bought a boat in NH, registered it in NH and stored it there for 6 months and 1 day, I have no legal obligation to pay sales tax. I should then be able to tow it home and store in my yard and leave it registered in NH. I realize this is a non-standard scenario however I think is is legal.

The other fact I was not aware of is. If you buy a boat in MA and then remove it from the state, like say I live in NH and buy a boat in MA and take it back to NH, according to MA state law you are still on the hook for sales tax.

FYI - I am not trying to condone tax evasion. I bought my boat in NH and could have registered it up there. I did not. I paid my MA sales tax and have the boat registered in MA.

 

[RB78]

Re: Sales tax and boat registration question

So if I purchase a boat in MD and say I intent to use it in NH can I register it in NH and then ship it overseas?
Thanks!

I live in NH, and you have to be a resident to register it for NH plates. Proof of residency is required at the first time of registration.