buying boat from out of state, CA sales tax?

Im buying a boat from another state from a private owner. How do I get around paying CA sales tax. I heard that I have to show proof that I took physical possession of the boat out of state, (I could have it shipped to AZ and pick it up there). And I heard it needs to be out of state for three months (how would the DMV know?) then I could register it in CA without paying CA sales tax - it would save me around $3700.00

has anyone done this or have info on the subject?

I purchased a 1 year old boat from a friend that was kept at Havasu. He gave me a bill of sale for$10 and the DMV did not question a thing. Saved me $2300. I was told if it were a new boat they would go by purchase price because the dealer must register it as you would a car.

I was in line behind someone at the DMV that tried to do the same thing - claim they paid a incredibly low price for something. The clerk ended up charging them based on the blue book value and they were screwed. What I've done is provide a reasonably low receipt which saved the guy that bought my boat a couple of hundred dollars.

Brett, I don't know if it matters since you're buying it used. I had a friend that bought an expensive yacht and he took delivery off shore and then took it to Ensenada for 6 months. Saved him something like $40,000. But he had to prove that he used it a reasonable amount of time while it was in Mexico otherwise they would have charged him the tax.

People do this kind of thing with RV motorhomes all the time. I am not sure if you can apply it to boats. You may want to search the RV websites. The link below details a lot

http://www.motorhomemagazine.com/cforum/index.cfm/fuseaction/thread/tid/4423021/gotomsg/4450277.cfm

I think you have to have reciepts that show that it was used/stored out of the state for 90 days, or 50% out of the state for 180 days.


Without lots of work and maybe some illegal fudging, you won't be able to get around paying tax. I woudn't reccommend it for all the trouble it may cause.

What I did when I bought a 1 year old boat was register it as non resident in arizona, they don't charge use tax and the registation fees were only $83. California use tax and registration would have been $3500. All I had to say was the boat is used primarily in powell and mead which is partly true.

Ok I kinda looked into it a little bit, I think the law states that:

I need to take possession outside CA - I could do this in AZ

It needs to stay outside CA and be "used" for 90 days - I am unclear on how much use it needs. Will 5 gas receipts and 10 launch ramp receipts fulfill this. other than those receipts for gas and launch, how are you supposed to show "use" to the dmv.

How am I supposed to use the damn thing if I havent registered it first anyway... the more I think about how CA screws you on tax the more pissed I get. The car reg's are tripling this year - 3TIMES more than last year!!!!!

Yup, just got my renewal for my pick up and it's $902. Cheat however and whenever you can!

I sold my boat to a guy in California a couple of years ago. I made two different bill of sales for him. One for the actual price and then one that was about 1/3 of the actual price. Screw the government whenever you can because you know they'll do the same to you.

Well im going to register it in AZ for a year then register it in CA next year then I wont have to pay tax and I dont have to worry about the 90 day test.

Doesn't AZ have sales tax too?

Alan ~ a little off topic here, BUT~
What is the make, model & year of your Pickup?

no AZ does not have "use tax" thats what CA calls it anyway. Its $85 to register, and thats it game over AZ-1 CA-0

Can you tell CA you got it as a gift from a family member?

Brett I purchased my boat from a buddy that lives in Agua Dulce and had a residence in AZ. At times he would trailer the boat home and run at Castaic. He was stopped a few times because they would notice that he did not have an AZ number and he would have to explain. He told me they watch for this all the time there. I did the same as Pat. 2 different bills of sale and like I said $10 on the DMV copy. They did not even ask a question all copies were signed by the previouse owner.

I should have said CF Number!

Registering in another state as a non-resident is a good way to avoid the tax. Unfortunately, some states are more rigorous than others about collecting the tax that is "technically" due. In Tennessee, the law states that any boat that spends more than 30 days in TN needs to be registered there. This is judged by calendar year so if your boat is seen on the water in June and then again in August, you are in violation. That isn't the worst part. I moved a boat from NH (no sales tax) to TN (9.5% sales tax). Even though the boat was registered in NH and was owned for a significant period of time, tax was due in TN. They tax the fair market value when it comes into the state no matter how long you own it. If you paid sales tax in another state, you owe the difference between the two. I spent a very long time on the phone with the revenue agent and was only successful in negotiating a lower market value to reduce the tax.

I heard the CA operates in a similar fashion (if you move a boat there, you owe the difference between CA tax and the state it came from tax).

The interesting exception is if you buy the boat from a relative. No tax is owed no matter where it came from. Don't know why, but that is another technically legal way around the tax that may work in other states as well (have a family member in another state buy it then sell to you). Is that an option in CA??

I saw a study that showed that the average american pays at least 45% of their salary to some kind of tax directly. The estimates are around 65% if you count the indirect taxes that add to the costs for items.

thats a high percentage, yet california is still going bankrupt!

Sold by a relative, I am not sure about the specifics, but I think it has to be gifted to you to be exempt from sales tax. Not sold to you. I purchased a truck ughhhhh I mean iI was gifted a truck from my grandparents, and they wrote a little note instead of a sales receipt that said it was irrevocably gifted to me. No problem at the DMV. If you are doing the lower price sales receipt thing to get the tax lower, go to AAA instead of the DMV to change the ownership. They don't have the motivation to nail you like the DMV does.

I believe it, look at the taxes you pay when you buy a gallon of gas. In California it's like 45 cents per a gallon. Normal sales tax, property tax if you own, taxes on your phone/cell phone bill, car registration taxes, Income taxes "state and feds", cap gain taxes, taxes on water "Arnold's quote, you pay taxes as soon as you flush the toilet in the morning" LOL it never stops damm I have purchased a boat and a car this year, paid about $6000 in sales taxes for those alone uggghhhhhhhh

Alan i honestly think if you pay that much just for tags in a state you must have one fine piece of *** to come home to every single day cause boy you be-in robb'd. I dont pay that much for 2 trlr tags, mc, tag, boat reg, and 2 vehicle tags??????????What the hell is going on over there and why dont you people do something, like fire some politicians???????

Bob, I think that's in the works as we speak. The governor is on his way out early, what a mess california is in.

phantom, 2003 chev.2500 HD,4wd,crew, duramx/allison

I personally am glad that I do not live in CA now. I do miss San Diego more than you know it......
Born and raised, a true native for over 30yrs...
Now that I own 2 cars 2001 & 2003, can't imagine the DMV fees

The price for paradise LOL yeah get the leach Gray Loooooser Davis out. Give me the Terminator.....ok he might not be the most qualified, but he is 20 times better than Davis or Bustamante.....and he has a chance to beat those as***.....now if the other Republicans will just drop out so we can get some major change.

Yep car tags are crazy here, we just bought our BMW before the deadline to pay the higher taxes/tags, and am hoping like crazy Arnold comes in to repeal it before we have to pay them again in a year, otherwise they will be over $1000 to renew....ughhhhh

Funny thing is the boat tags are pretty cheap and the trailer tags are good for life, you never have to renew them for like $30. OF course they are going to hit me with 1% property tax on the boat. Everywhere you turn, the damm State goverment in CA. has it's hands out.......any breaks the feds. have given us, has been taken away by the state double, loooosersss.....give me Arnold now!!!!!

I think trailer tags are good for five years not life.

My tags said "Permanent". I figure that's life

From CA DMV's Website:

Permanent Trailer Identification (PTI) Fee

All trailers, except trailer coaches and park trailers, are assessed a Permanent Trailer Identification (PTI) Fee. The initial fee is $20. Once a trailer is in the PTI program a $10 service fee is due every five years. PTI trailers are not subject to other Registration Fees, California Highway Patrol Fees, County Fees, Vehicle License Fees, and Weight Fees.

$10 every 5 years, what is the point? Probably cost them double that to process it! LOL I wasn't aware of that, I was thinking the same thing as Jeff. Permanent meant just what it says, I guess in five years I will get a bill for $10 and probably misplace it and they will send me another one a few years later for $10 plus $5000 in late fees and penalties.

Have you ever seen what they hit you for in late fees on CA car tags, it's like 25% a month, ouch!!!!!

"PTI trailers are not subject to other Registration Fees, California Highway Patrol Fees, County Fees, Vehicle License Fees, and Weight Fees"

LOLOL I had to laugh at that above, that is FIVE fees wrapped in to one LOLO ludicrous