am Canadian. I bought a powerboat in FL and would like to cruise it back to Victoria BC Canada. I had 90 days to get the boat out of FL and change the reginstration to Canadian in order to avoid a sales tax there. Then I called San Diego customs to understand how I could get a cruising permit in order to spend some time cruising in California before going up to coast to Canada. I was told the boat has to be out of US waters at least 6 months before I can get a cruising permit as a Canadian and if not, I could be charged sales tax in California. Is that true? Feedback from any tax lawyers appreciated.
I reside in Victoria BC Canada and plan on spending 6-7 months in California before going north to Victoria.
Elder Law Attorney
Sales tax and multi-state sales tax rules are often confusing. California can be a greedy state. Unfortunately, you failed to give one important piece of information needed to answer your question. Where to you reside ? Do you ordinarily spend any significant time each year in California ?
Best wishes, hope to hear from you soon.
Joel S. Weissler
Attorney at law
DISCLAIMER: Nothing in this post or transmitted by email should be interpreted as legal advice unless I have been retained and you have made a deposit towards my fees. This post is intended to help the person posting the question to ask the right questions with the attorney of their choice. Your time to act may be very limited and this could substantially reduce your rights and options. Do NOT rely on anything I have written here -- You should contact a lawyer in your area immediately after reading my posting. I am licensed to practice law only in the State California. For questions connected with the laws of other states you should seek an Attorney in that state to advise you. The following disclosure is required pursuant to IRS Circular 230: unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein.
The sale happened in FL, so the Board of Equalization couldn't charge you any sales tax. It could be that they are saying that you would be charged a use tax. If you are a California resident, they could charge you that use tax since the purpose of the use tax is to collect tax on property purchased out of state and brought into the state. If you stay in CA more than 120 days, you may have to register the boat with the DMV if the boat is primarily used on CA waterways during that period. You just wouldn't owe a use tax because you don't have a CA county of residence to calculate the tax rate.
All information provided is for general purposes only and does not establish an attorney-client relationship. For more information, please visit my website at www.soaresandlykken.com.