Brand New Boat Out Of State, Who Gets The Sales Tax?

Ross · Jul 11, 2010

sigbear said:
If buying a brand new $100,000 in stock boat from a Virginia dealer and taking delivery in Kentucky, who gets the sales tax?

My guess would be that you pay the sales tax to the state where you register the boat not where you bought it, but that's just a guess.

Sigbear

I would have the dealer deliver the boat to Kentucky and complete the transaction there. Some states have transportation tags for cars so that if you make a purchase outside of your home state you may drive it home and get permanent registration.
In any case the dealer should know but you may be obliged in both states.

Roger Long · Jul 11, 2010

sigbear said:
If buying a brand new $100,000 in stock boat from a Virginia dealer and taking delivery in Kentucky, who gets the sales tax?

My guess would be that you pay the sales tax to the state where you register the boat not where you bought it, but that's just a guess.

Sigbear

Good information resource here:

http://www.boatus.com/gov/StatetaxRegistration.asp

Click on VA and you can see that sales tax will only be 2% whereas it is 6% in KY. Seems like a no-brainer except that, if KY is like most states, they will hit you up for the difference when you register the boat. You can thus pay 2% in VA and 4% in KY or, if VA has a provision for letting you not pay sales tax on a boat being taken immediately out of state, you can let your state have the whole amount.

Alan · Jul 11, 2010

When I bought my boat out of state the dealer collected the sales tax for the state he was in and I had to pay the difference of the higher tax in my home state. The net result was the same as if I had bought my boat locally.

navigator97 · Jul 11, 2010

I beleive that the tax is paid to the state in which you "take delivery". That then depends on how the dealer writes up the sale. If he writes it for you "taking delivery" in KY, then that who gets and determines the sales tax. I also beleive that you have to keep the vessel in the state in which you take delivery for that statws tax to hold. i.e if you "take delivery" in VA, then it would have to stay in VA waters for a year or so for the 2% VA tax to hold. ven then KY might want "their piece of the apple" later when you register it.

seadaddler · Jul 11, 2010

Some states do not collect a sales tax when the boat is going to another state and than you pay what ever tax in that state which the boat is going to be used or registered,that is what I found when buying in conn. a few years a go.

Alex Dare · Jul 12, 2010

tax & registration

Generally you pay tax as part of the registration required in the state of principal use (aka it's home port where it will be kept and primarily used from) not where it's purchased. In Maryland there is a form that must be filled out and mailed in stating that although you purchased the boat in state, you will not be keeping and using it in MD and therefore no tax is due the state of MD. Va probably has something similar. The dealer should be able to help you with that.

lylew · Jul 12, 2010

The state where the boat is to be tittled.

Roger Long · Jul 13, 2010

lylew said:
The state where the boat is to be tittled.

Not necessarily. We had to pay sales tax on the boat we bought in MI and then show ME the receipt in order to avoid paying it here as well.

The confusing mess of different state laws makes this a subject too complex to rely on anything you learn in a forum like this. You practically need a tax lawyer. Ask this guy:

http://www.timesargus.com/article/20091222/NEWS02/912220373/1003/NEWS02