Rhode Island registered Boat & storage in Massachusetts

[PDReynolds]

Hi Folks,

I am laying up my boat from November until April and I am considering dry storage at a marina in the state of Massachusetts. The boat is registered and docked currently in RI.

Has anyone encountered any tax issues, whereas tax-achusetts has taxes etc?

 

[RichH]

First read
http://www.boatus.com/gov/states/MA.asp (Summary of Mass. boat/tax laws.)
Then
http://www.boatus.com/gov/states/RI.asp

The customary 'trajectory' for such tax burdens due is as follows (in all states):
•*Boats located in Mass. for more than 90 days are due to pay the 'differential' in sales/use taxes originally paid at the time of original sale:
6.25% of the original sales price or the 'current assessed market value of your boat' -MINUS- Your 'original' sales/use tax already paid to another state.

• You paid NO sales/use tax in RI

• When the boat is in MA and the 90 days 'grace period' is expired, you will automatically *owe* MA 6.25% of the value / market value of your boat to the state of MA. (better have receipts showing sales taxes paid for all that added equipment, too)
7% if the value is over $100K.

The same happens with cars, trucks, airplanes, and pogo-sticks too.
Welcome to "Sozialismus"

 

[Bob J.]

Unless things have changed you should be able to store your boat in Mass for the winter without any tax issues.

 

[CarlN]

First, advice from the Internet is worth what you paid for it.....

There are two Massachusetts taxes to worry about with boats. My understanding (not-expert) is:

Excise tax. This is owned if your boat is registered in Massachusetts. It must be registered there if it's there on July 1 unless you can show it's habitually somewhere else. It's not a big tax. Typically a few hundred dollars.

Sales/use Tax: This depends on whether the boat was intended to be used in Massachusetts when it was purchased. If you bring a boat that was delivered to you outside Massachusetts into Massachusetts - even for one day - during the first six months of your ownership, the state considers that proof that you intended to use the boat in Massachusetts at purchase (especially if you are a Massachusetts resident). The burden is on you to show otherwise. This is an uphill struggle.

But after six months, the burden switches. Now the the state has to show intention at the time of purchase. Creating an obvious written record like applying for a mooring in Massachusetts when you bought the boat can make that burden for them but otherwise they have the uphill struggle.

If the boat is new to you, I think you are taking a risk storing it in Massachusetts. If you've had it for several years you would seem to be fine (although I would check some other sources). Have you asked the boatyard? Things change.

Carl

 

[Rich Stidger]

There are two taxes as carlf describes. The excise tax is levied by individual towns and cities at their discretion. Not all municipalities choose to collect the tax. In a town where there are a lot of boats, they probably do collect, but in an inland town they may not.

The sales and use tax is the big kicker. It is collected as described above. I would ask the intended storage marina what their experience has been and I would even then call the MA dept of revenue and ask them if you are at risk. Some states (I don't know if MA is one of them) only consider the sales/use tax to be due if the vessel is "ready for use". This usually means that it is in the water or on rack storage ready to be launched. Off season storage on land or in a shop for repairs exempts the boat from this tax.

You must get a clarification from the MA officials to be sure. I would ask them to point you to the written tax code so that you have a written rule.

BTW, FWIW, although my sailboat is moored in Bristol, RI, I live in Massachusetts.

 

[Bob J.]

I have a couple of friends that boat elsewhere but store their boats in MA for the winter. Nobody chases them for any type of tax.

Most of the time the issue gets raised during the season when the water police or harbormaster take note of boats from away when cruising mooring fields or marinas.
I spent 15 years in Newburyport with a NH documented boat & only paid the yearly "use" fee to the town. The only time I got harassed for MA sales tax or registration was when I kept a NH registered boat down there during the season.

As others have noted, check it out w/ the facility you want to store your boat at & please let us know what they say.