Boaters who’ve heard about no-sales-tax states, such as Delaware or Oregon, wonder if they could eliminate sales tax on a boat purchase if they simply buy a boat there. The answer is yes – but only if they use their boat in those states. Generally, boaters have to pay the sales tax in the state where they use the boat, not where it’s purchased. However, there’s more to the boat sales tax issue, according to Boat Owners Association of The United States (BoatUS). Here are six tips from BoatUS and some info about buying locally, at Lake of the Ozarks:
1. Buying a boat out of state
Boaters may certainly buy a boat in a state that does not have a sales tax or with lower sales tax than their home state. However, most out-of-state (nonresident) boat purchases require the buyer to remove the vessel after the purchase. For example, in Florida, nonresidents who buy a boat from a dealer there must sign an affidavit stating that they’ll leave state waters. Small boats have 10 days to leave; larger boats have 90 days. And unless a boat purchased in Florida will be registered in one of the no-sales-tax states, owners will have to pay sales tax (known as a “use tax”) at their own state’s tax rate when the vessel is registered in their home state.
2. Moving a boat out of a no-boat-sales-tax state
If a boat owner decides to move his or her boat from one of the five states without a general sales tax (Alaska, Delaware, Montana, New Hampshire, and Oregon) to any other state, when the vessel is registered in the new state, it will trigger the sales tax due.
3. Thinking of cheating?