[PUP] taxes and registration

[John Marshall]

 From the US perspective, one reason for a flag of convenience would  
be if you ever wanted to hire a foreign national to crew on your boat  
when you were entering US waters. US flagged vessels must have only  
US crew. Penalties are very big if you violate this one.

Some states make it easy to avoid taxes with an offshore registry  
(flag of convenience), so that's one motivation. Your (and my) home  
state of WA doesn't happen to be one of those 'easy' states.

But I agree with posters who say you can legally avoid state taxes,  
either as a US documented vessel or foreign flagged, if you do an  
offshore DELIVERY (beyond any states waters, usually 3 miles), you  
(usually) have to stay completely out of your home state and if you  
don't stay in any one state very long. But each state's laws need to  
be studied to find a legal path to do this. Some states don't have  
sales tax (Oregon, etc.) and others have caps on the sales tax (like  
Virginia) that are very low. CA residents have their own strategies  
that are well known.

Personally, I think its too much of a hassle to avoid taxes if you  
are planning on staying in US waters for some period of time. You  
have to live like a gypsy.

But if you buy the boat with intention to cruise outside the country  
for a few years, and are just keeping it inside US waters only long  
enough to get it commissioned and ready, then why not do an off-shore  
delivery and then delay paying the tax bill until you return? Who  
knows, you might sell the boat before you return or return somewhere  
else and never have to pay it.

John



>
> [scott]  As I said in my original post, I don't fully understand  
> the issues
> around documenting a vessel.  I don't understand why it would be  
> documented
> in another country if the motivation wasn't to escape paying  
> taxes?  Again,
> I'm pleading ignorance in this regard.  Perhaps someone can  
> elaborate on why
> a boat bought and paid for by a US citizen, who lives in the US,  
> pays taxes
> in the US and keeps his boat in the US would document it offshore  
> (if for
> any other reason that to escape taxes).
>
> Scott Bulger, Alanui, N40II, Seattle WA
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