Ahoy, future boat owners! Dreaming of sailing the sunny Florida coast but dreading that hefty sales tax? Fear not! We’ve got the insider scoop on how to avoid sales tax on boats in Florida. Keep reading to discover how you can keep more of your treasure where it belongs—on your boat!
Florida has some of the widest variety of boat dealers in the US. The Sunshine State gets a good number of visits from people looking for a good deal on a boat. But like many other states in the US, buying a boat is also subject to sales tax.
What Is Taxable?
All boats sold, delivered, used, or stored in Florida are subject to sales and use tax and any applicable discretionary sales surtax unless exempt. Florida boat brokers and dealers are required to collect tax from purchasers at the time of delivery or sale.
Typically, when a boat is bought into Florida for use in Florida or is sold by someone other than a registered boat dealer, then it is due for Florida use tax. In addition, other applicable discretionary sales surtax are also due when:
- The boat is bought from a person who is not a registered boat dealer, and the delivery or sale takes place in Florida
- The boat was bought in another state or territory in the United States or the District of Columbia and brought to Florida within six months of the purchase date.
- The boat can be bought in a foreign country and brought into Florida anytime.
When Is Tax Due?
A boat must be titled, licensed, or registered in Florida with any tax collector, licensed private tax agency, or the Department of Highway Safety and Motor Vehicles unless exempt within:
- 30 days of the purchase or the date the boat entered Florida
- 90 days after the boat enters Florida, when the boat is documented, titled, registered, or licensed in another state.
How To Avoid Sales Tax On Boats In Florida
While it might seem like closed waters, there are still a few ways to maneuver sales tax on boats to your benefit while enjoying the adventure.
Out-of-state Boats: if Florida won’t let you have your sailing adventure while saving money, why not consider buying your boat from a dealer in another state? That’s right. You can buy your boat from a dealer in a state with no sales tax, such as Delaware, Alaska, or Montana, and register it in that state. This way, you can sail it to Florida and register for it there. But wait! You can only register for it after 90 days. Why 90 days, you’d ask? It’s to convince Florida that you’re not just buying a boat to avoid taxes but a true lover of the high seas.
Adventures Boats: Your love for adventure beyond the shores of the United States might just pave the way for some tax write-off for you! Yep, you can buy a boat in international waters (at least three miles of shore into international waters) and enjoy a tax-free transaction as long as it is documented with photographic evidence(including a photo of the day’s paper and the GPS coordinates)
Boats Sold To Nonresidents: Boats sold through or by a registered dealer or broker to a buyer who is a non-resident of Florida at the time of taking delivery of the boat in Florida are also exempt from sales tax. However, this does not apply to the sale of a boat trailer.
We all want to take advantage of every tax opportunity (and explore the waters while doing so), but it’s best to consult a tax expert before making any tax pirate moves. Looking for more IRS-approved tax strategies? Book a free consultation with the Tax Goddess Team today!
