Tax Loop-hole Maine residents with NH registered boats?

[lawn psycho]

So here's a timely article regarding Maine trying to tax boats bought in New Hampshire.
What I'm not sure about is if a Maine resident buys a boat and never brings it too the State of Maine the first year, would they get hit with a sales tax if they brought it into Maine in subsequent years.
See article:
http://www.seacoastonline.com/articles/20091219-NEWS-912199997

[wifi]

Maine is crazy in taxing people from out of state. If you hold a job in Maine, and you live out of state, your entire family is liable for Maine income tax. So, for example, you live in Mass, work in Maine, your wife works in NH, you owe Maine income tax on your wife's NH salary plus your Maine salary and any other income you might have, no matter what state it is earned.

Have to love those that want to tax others to pay for their ownership expenses... what is their mantra.... Oh yes, "I only owe tax on my ability to pay it, if I own more than I can afford, then others have to pay my fair share" .... :)

[townsde]

Wifi. That sounds like double taxation to me. Didn't that cause a revolution in the past?

[lawn psycho]

Maine is crazy in taxing people from out of state. If you hold a job in Maine, and you live out of state, your entire family is liable for Maine income tax. So, for example, you live in Mass, work in Maine, your wife works in NH, you owe Maine income tax on your wife's NH salary plus your Maine salary and any other income you might have, no matter what state it is earned.

Have to love those that want to tax others to pay for their ownership expenses... what is their mantra.... Oh yes, "I only owe tax on my ability to pay it, if I own more than I can afford, then others have to pay my fair share" .... :)

I don't think that's quite how it works. I beleive as a non-resident if you work in Maine and have a spouse who works in NH, they base your state deduction on the proportion of Maine derived income from your total income.

Regardless, once the housing market stabilizes, I will sell and move back to NH.

[Audiofn]

I had my boat registered in NH for a few years and when I purchased my land in ME I did not pay sales tax on it.

Jon

[lawn psycho]

I had my boat registered in NH for a few years and when I purchased my land in ME I did not pay sales tax on it.

Jon

If you just own own a lot you're fine. If you claim residency and they find out, they'll come after you.

I'm thinking of buying a 10ft x10ft lot with a sink, microwave, and porta-potti and claim NH residency. Anybody looking for a beverly hillbilly cousin they want to sell some land too on the cheap? I'll even give you a cut of the moonshine sales :laugh:

[Airwaves]

I saw that article last week. It seems to me the guy from Maine made two mistakes that cost him.

1. He purchased the boat THROUGH A DUMMY NH BUSINESS THAT HE ESTABLISHED FOR THAT REASON.
2. He brought the boat into Maine within a year of it's purchase and it remained in Maine for longer than 30 days.

I think the second item is the one that did him in legally although I am sure the establishment of a dummy company in a sales tax fee state to buy the boat in Florida did not endear him to the Maine tax collectors and produced the red flag.

Remember, it's not just a sales tax, it's a sales and USE tax.

[lawn psycho]

I saw that article last week. It seems to me the guy from Maine made two mistakes that cost him.

1. He purchased the boat THROUGH A DUMMY NH BUSINESS THAT HE ESTABLISHED FOR THAT REASON.
2. He brought the boat into Maine within a year of it's purchase and it remained in Maine for longer than 30 days.

I think the second item is the one that did him in legally although I am sure the establishment of a dummy company in a sales tax fee state to buy the boat in Florida did not endear him to the Maine tax collectors and produced the red flag.

Remember, it's not just a sales tax, it's a sales and USE tax.

So what I want to know is, if you are a Maine resident and for the first year of ownership it never is in the State of Maine and then you decide later to move it onto a Maine lake, would the tax weenie alarm go off?

[Blue Thunder]

So what I want to know is, if you are a Maine resident and for the first year of ownership it never is in the State of Maine and then you decide later to move it onto a Maine lake, would the tax weenie alarm go off?

I would say so.
If you can prove that the boat was registered in another state for the first year, you will not pay sales tax. Example: purchase the boat in NH and register it there for one year, then register it in Maine from there on. The only problem with that would be the 75 day limit that you would be allowed to use the boat in Maine without it being registered there. Maine has no where near as agressive MP as other states and I've never heard of anyone being cited for it.

BT

[LIforrelaxin]

It amazes me what people will do to get around paying sales or use taxs.... now I admit to buying a boat in NH, and registering it there... but then again that is where I use it and my family owns waterfront property..... but you know, if I was going to be trailering it.... I would deal with the tax not worry about scamming the state, and pay the dam tax.......

Part of the problem in this country is that people are trying to live beyond there means.... if you can't afford the taxes on something and by it legally then guess what you can't afford it.....

Just do things legally people then you don't have to worry.....

[brk-lnt]

Part of the problem in this country is that people are trying to live beyond there means....

You are right, but at the same time, too many politicians think that every person with a decent income should be required to also support 3 non-working citizens.

I spent a week in China recently and saw people out sweeping the streets by hand. I think that the majority of the welfare/public-aid recipients should be required to do SOMETHING to earn their benefits (note, this is different than unemployment benefits).

Much of the tax burdens could be reduced or eliminated if we also eliminated some of of the public welfare programs that really do little more than convince lazy people not to attempt to earn a decent living.

[TOAD]

It amazes me what people will do to get around paying sales or use taxs.... now I admit to buying a boat in NH, and registering it there... but then again that is where I use it and my family owns waterfront property..... but you know, if I was going to be trailering it.... I would deal with the tax not worry about scamming the state, and pay the dam tax.......

Part of the problem in this country is that people are trying to live beyond there means.... if you can't afford the taxes on something and by it legally then guess what you can't afford it.....

Just do things legally people then you don't have to worry.....

The real reason there is a problem is because the taxes in this country and all of the states are so ridiculous that yes, folks will try and avoid them. If there wasn't so much waste, fraud and abuse of the taxpayers money then perhaps many folks would not mind paying the proper tax. I personally avoid the "TAXMAN" at every opportunity because I don't like seeing my hard earned dollars pissed away by government hacks.

[lawn psycho]

It amazes me what people will do to get around paying sales or use taxs.... now I admit to buying a boat in NH, and registering it there... but then again that is where I use it and my family owns waterfront property..... but you know, if I was going to be trailering it.... I would deal with the tax not worry about scamming the state, and pay the dam tax.......

Part of the problem in this country is that people are trying to live beyond there means.... if you can't afford the taxes on something and by it legally then guess what you can't afford it.....

Just do things legally people then you don't have to worry.....

Are you directing this towards me or too the guy in the article?

People seem quick to want to throw other people's money away but when it comes time for them to pay it's a different story. In your own post, you confess to being a non-resident and never having paid your state sales tax on your boat but then tell people they can't afford something because they want to avoid state sales taxes where possible? Hello pot, meet kettle.

If my boat was purchased in NH, stays in NH, and is registered in NH (as legally required to stay in Marina for summer), I certainly don't think Maine should get one penny from my boat.

Aren't you the one who wants to bring a sales and income tax to NH?

[LIforrelaxin]

Are you directing this towards me or too the guy in the article?

People seem quick to want to throw other people's money away but when it comes time for them to pay it's a different story. In your own post, you confess to being a non-resident and never having paid your state sales tax on your boat but then tell people they can't afford something because they want to avoid state sales taxes where possible? Hello pot, meet kettle.

If my boat was purchased in NH, stays in NH, and is registered in NH (as legally required to stay in Marina for summer), I certainly don't think Maine should get one penny from my boat.

Aren't you the one who wants to bring a sales and income tax to NH?

I am not picking on anyone here.... just making a statement.....

Now if you boat is purchased in NH stays in NH and is registered in NH.... then there is no way any other state can take you on it..... Because they will not know about it..... until you sell.... in which case you have to report any gain made on the sale as income.... and it would get taxed as income.

My comment is directed at the stories here of the idea of buying a boat in NH to get around paying sales tax in another state.... and the games of how to try and do it.... As I recall you have never said anything like this..... so how could I have intended to aim the comment at you.....

Taxes suck they always have.... but you know what, you just deal with them..... there is still now other country I would rather live in. As for sales and Income tax, yep I have said it many times, it is a certainty..... they will come to NH it is just a matter of when....

[brk-lnt]

in which case you have to report any gain made on the sale as income....

Has ANYONE ever made a GAIN on the sale of a boat? I don't think that has historically ever been possible. :laugh:

[lawn psycho]

Has ANYONE ever made a GAIN on the sale of a boat? I don't think that has historically ever been possible. :laugh:

The worst part about it is the jokes on boat owners in the depreciation department. Although spending quiet time on the lake on a sunny day in the summer is priceless IMO.

He obviously must not understand the term "basis".

NH will never have a sales tax. You'd wipe out many retail businesses. Heck, N. Conway and the malls in Newington and the Nashua area would probably cease to exist.

It's all those honest massachusetts taxpayers heading to tax free NH keeping NH's economy going:rolleye1:

[OCDACTIVE]

I am not picking on anyone here.... just making a statement.....

Now if you boat is purchased in NH stays in NH and is registered in NH.... then there is no way any other state can take you on it..... Because they will not know about it..... until you sell.... in which case you have to report any gain made on the sale as income.... and it would get taxed as income.

My comment is directed at the stories here of the idea of buying a boat in NH to get around paying sales tax in another state.... and the games of how to try and do it.... As I recall you have never said anything like this..... so how could I have intended to aim the comment at you.....

Taxes suck they always have.... but you know what, you just deal with them..... there is still now other country I would rather live in. As for sales and Income tax, yep I have said it many times, it is a certainty..... they will come to NH it is just a matter of when....


The sales tax I don't think will ever come but the income tax unfortunately may. Never understood that.. the harder I work the more I am taxed. Absolutely crazy IMO.

We are all supposed to be treated equally except when it comes to taxes. What happened to the idea of a Flat Tax?

[lawn psycho]

The sales tax I don't think will ever come but the income tax unfortunately may. Never understood that.. the harder I work the more I am taxed. Absolutely crazy IMO.

We are all supposed to be treated equally except when it comes to taxes. What happened to the idea of a Flat Tax?

The crazy part is people think an income tax will majically erase they problem which is too much spending by those in office. I'm not so sure NH will see an income tax either. You have a lot of retirees in the state soley for the purpose of lower tax burden.

I say we tax anyone who lives on an island on Winnipesaukee a 50% income tax since they're mostly out-of-staters. Yeah, that would be fair and the "New England" way.....

[OCDACTIVE]

I say we tax anyone who lives on an island on Winnipesaukee a 50% income tax since they're mostly out-of-staters. Yeah, that would be fair and the "New England" way.....


I assume you are being sarcastic.... But we have to be careful considering if we constantly tax the out of staters they may not come to the state.. It is a fine balance.

[lawn psycho]

I assume you are being sarcastic.... But we have to be careful considering if we constantly tax the out of staters they may not come to the state.. It is a fine balance.

OCD, yeah I'm being sarcastic. Since LIlovestaxes wants to pay taxes carte blanc, I'm all for him paying instead of me ;)

[OCDACTIVE]

OCD, yeah I'm being sarcastic. Since LIlovestaxes wants to pay taxes carte blanc, I'm all for him paying instead of me ;)

I don't think thats what he was getting at but I won't speak for him either.

I would agree that people need to take responsibility for themselves and shouldn't try to find loop holes. It is the small % of people who do exploit these who cause for stricter regulations on us all whether it be taxes or other restrictions.

[TOAD]

I don't think thats what he was getting at but I won't speak for him either.

I would agree that people need to take responsibility for themselves and shouldn't try to find loop holes. It is the small % of people who do exploit these who cause for stricter regulations on us all whether it be taxes or other restrictions.

So we just pay, and pay, and pay, and do and do and do...whatever the government pig wants? :confused::confused::confused::confused:

Sorry Charlie...that is not what this country is all about.

[OCDACTIVE]

So we just pay, and pay, and pay, and do and do and do...whatever the government pig wants? :confused::confused::confused::confused:

Sorry Charlie...that is not what this country is all about.

I never said that.... However, that is what elections are for. I think the governement has too much involvement in our lives already and it seems as if it will only get worse.

I only feel that the less loop holes are exploited the less the government will have to tighten their grip on us.

I hate taxes as much as anyone else but its the price we pay for living in the best country in the world.

[fatlazyless]

If anyone has been following the lawsuit between the medical insurance fund and the State of NH, it's probably pretty much expected for the state to lose its appeal to the NH Supreme Court and be short of about 100 million dollars. While 100 million sounds like a lot, it is just a small percentage of the state's annual 11.5 billiion dollar budget.

Another lawsuit between the state and a number of cities and towns is pending which seems to be very much up in the air as to which side will prevail. The state recently, like in last July, either passed a law or made an executive decision to downsize its payouts for all the municipality's employee pensions. The state had been paying for 35% of each town's employee pensions, and it decided to cut its' payment from 35 to 30 to 25%, over the next year or two.

The state's argument is that it has no control over how much a town decides to pay its' employees, which is the basis for their pensions, so why the heck should they be paying for those big fat pensions.

Here's the solution that's look'n for a problem here...... just start registering all those paddle boats like kayaks and canoes.....and then let them take care of the state's 35% share of the towns pensions with the kayak money.

All in favor....raise your paddle in support!

Oh yeah.....um....what was this thread all about.....cannot seem to remember?:D

[chipj29]

The sales tax I don't think will ever come but the income tax unfortunately may. Never understood that.. the harder I work the more I am taxed. Absolutely crazy IMO.

We are all supposed to be treated equally except when it comes to taxes. What happened to the idea of a Flat Tax?

I can't wait for NH to implement an income tax. That way, since I work in MA, I will have to pay 5.5% to Mass, AND I will get the honor of giving a slice to NH. AWESOME!

[OCDACTIVE]

I can't wait for NH to implement an income tax. That way, since I work in MA, I will have to pay 5.5% to Mass, AND I will get the honor of giving a slice to NH. AWESOME!

And don't forget the huge property taxes that were supposed to be in lieu of an income tax! But I personally do not think and income tax is in our near future. The Legislature just got railed on the income tax proposed to LLC's. So an overall income tax in the near future is probably not going to happen.

But I have been wrong before on predicting logical bills with this legislature.

That being said, I would be for registering "paddle" boats. The MP and Fire Rescue has to use its resources to help those whether it be engine powered or paddle driven. I think they should also pay for that. Also, not to open a can of worms, but how about Legalized Gaming? Just think of the bus loads of people that would be going up our mid-corridor to the north country if a casino was built there? The economic boom would be amazing! Instead of watching bus loads of people leaving our state with their money and spending it in conneticut.... It is only a matter of time before Mass does this, why not get ahead of it!

[LIforrelaxin]

So I got this thread going all over the place and well I will of course take responsibility for that. Of course I also didn't think it would develop into the discussion that have popped up. However there have been some good discussion points here.

Now, my comment regarding trying to aviod loop holes, is a comment specifically about that. There are many loop holes out there. We have all probably exploited one or two in our life time. Hell simply by buying a case of wine in NH and bring it into another state you have violated some laws.... My point here is this. If people stopped trying to find and use the loop holes and just paid sales and use taxes when they are supposed too, there would be generated income for the various states. And there also wouldn't be states comming after people after the fact.

Now I do often bring up Sales and Income Tax for NH. Why because everyone is concerned about there property Tax in NH. Do I like More Taxes. Hell No, no more then anyone else. However if the state needs money they are going to raise it one way or another. So do you want to continue to see your property Tax go up or do you want other forms of Taxation.....I was very interested to read OCD take that he thinks sales will never happen but Income might..... I actually always thought it would be the oppisite.... My thought on this derived from the Washington State Model... At anyrate.... NH has to make up its mind of how it wants to fund itself...if you take Sales and Income out of the equation. Then just remember we are all going to continue to pay more and more property Tax.

Now when it comes to stopping the increase in the ammount of Revenue the state needs that is another arguement. The advice I have there, is for people to get involved in the Government. Make sure you examine your choices come election time. Definately make sure you get out there and Vote. But remember that isn't enough. You must also Follow up, don't elect the right politicians and then think your job as a citizen is over. After that you need to make sure they do what they promise. And when they don't question them. Every Polictican Local, State, and Federal, has office, and they are supposed to make themselves avaialble to talk to people. Get involved, talk to these people, and let them know they are being watched, and graded against the promises they make.

Ok, whoa, I need to get off the soap box..... but anyways I feel better...

Lawn Pyscho.... You provide a great challenging converstation... it is always fun to converse with someone that is going to make you think and justify what you are saying......

[John A. Birdsall]

I have heard a rumor and I hope it is true that property taxes are gonna be reduced by 75% and it will be locked in at that with no increases. Then the state is putting a 6.5% income tax on all residence earning money in or out of the state of NH. And then put in in six months a sales tax of 3% on all goods.:D

[JPC]

So we just pay, and pay, and pay, and do and do and do...whatever the government pig wants?

Whenever I see someone refer to the government this way, I have to wonder wether they actually vote at election time. If you don't vote, don't complain.

[TOAD]

Whenever I see someone refer to the government this way, I have to wonder wether they actually vote at election time. If you don't vote, don't complain.

I vote in every election...so you wonder erroneously! I have a right to complain. I vote for conservatives every chance I get. Unfortunately there are not a lot of conservatives that don't wll themselves out when they get in office...power breeds corruption, and corruption brings on power.

I guess you must think the government is the answer to everything.

[Wolfeboro_Baja]

..........I guess you must think the government is the answer to everything.Actually, no but sometimes, the government is the only answer to some things! Let's face it, unless there's a profit to be made, private business isn't usually interested in helping people.

[Ropetow]

I have heard a rumor and I hope it is true that property taxes are gonna be reduced by 75% and it will be locked in at that with no increases. Then the state is putting a 6.5% income tax on all residence earning money in or out of the state of NH. And then put in in six months a sales tax of 3% on all goods.:D

I think you rumor is a dream (or nightmare) for three reasons.

#1 -- Never in recorded history, I bet, has a tax been reduced by 75% and then locked in at that rate. If we give the folks in Concord a sales and/or income tax, they'll just find ways to spend it on their social welfare liberal agenda to make us even more like a MA-North.

#2 -- A 6.5% income tax is outrageous! Too bad we can't have an income tax for folks like me who work out of state. I work in MA and pay MA income tax. When I mused to a Concord pol how I'd rather NH have an income tax that only applied to folks like me who worked out of state, I was told that it was a good idea, but that it was unconstitutional.

#3 -- A sales tax would decimate our retail business, as was mentioned in an earlier post.

Hopefully, we'll have a BIG change in Concord in '10 and won't have to worry about new taxes and can concentrate on controlling spending, something the majority party in DC and Concord would never think of.

OK....Off my soap box

[TOAD]

Wolfeboro-BAJA
"The problem with arguing with an idiot is, they'll drag you down to their level and then beat you with experience."


The above in your signature...so I'm done with this thread.

No government ever voluntarily reduces itself in size. Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we'll ever see on this earth!
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag147680.html)

Government does not solve problems; it subsidizes them.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag147689.html)

Government exists to protect us from each other. Where government has gone beyond its limits is in deciding to protect us from ourselves.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag393026.html)

[Acres per Second]

My "Off-Season" state, which is nearly tied with NH for 46th place in personal tax burden, has only moderate property taxes and only 7% sales tax; however, it is the recently-raised property taxes that has caused my "Off-Season" state to lose population! :eek:

"...I only feel that the less loop holes are exploited the less the government will have to tighten their grip on us..."
I always capitalize The Government, to illustrate that it is becoming more—and more—"a fearful master". :(

(Toad, starting soon, I'm "stealing" your signature. :D )

Has ANYONE ever made a GAIN on the sale of a boat? I don't think that has historically ever been possible.
Like the recent auction (http://www.winnipesaukee.com/forums/showpost.php?p=113832&postcount=26) of the 1950's Chris-Craft "Sea Witch" of Lake Winnipesaukee, it's done on occasion. The boat needs a good brand, an interesting "history", and would (more than likely) be constructed of wood!

"...Actually, no but sometimes, the government is the only answer to some things! Let's face it, unless there's a profit to be made, private business isn't usually interested in helping people..."
"Helping people" is what a lawyer-acquaintance says he does. :rolleye1:

It's odd that a bordering state permits its taxpayers the option of paying the former state income tax rate—which was higher! And a few taxpayers DO! :eek2:

1) Two bordering states (including Maine) hire Government workers to 'tighten their grip on people'. That is not the way to put people to work—as it increases taxation. :mad: (Even worse, when we're taxed for their pension and the person who replaces them).

2) "Private business" provides tax relief, gainful employment—and, indeed—could put The Government out of the welfare business by withholding The Government's take of "business tax".

3) In eleven months, listen for these selective "phraseologies":

"Going forward" and..."He's For The People"—then vote for the other guy! ;) :)

[SIKSUKR]

I don't understand the dissing of using loopholes. A loophole does not make it illegal. That's just how the tax system is structured. If you don't use every legal loophole available to you then your throwing your money away. As my dad has always told me, it's not what you make, it's what you keep.

[lawn psycho]

I'm guessing that some individuals on this board are or have been employed by a governmental body.

Who in their right mind wants to voluntarily expand the role of our government? Aye, aye, aye, there must be something in the water.....

[LIforrelaxin]

I don't understand the dissing of using loopholes. A loopholes does not make it illegal. That's just how the tax system is structured. If you don't use every legal loophole available to you then your throwing your money away. As my dad has always told me, it's not what you make, it's what you keep.

I think the using of loop holes is fine as long as you are doing it with in the letter of the law.

However if you buy a boat in NH and don't pay sales tax, then sneak the boat over to a lake in Maine, Vermont, Mass, or anywhere, where you are a resident .... to avoid paying taxes in that state "unless you get caught" then you are not using the loophole legally you are exploiting it.

For anyone that lives in Ma. Maine, or Vermont, and only uses the boat in NH, like myself. Buying the boat and keeping it in NH, is not exploiting anything. I am using the loop holes regulations to my advantage. However if I where to sell my boat, and make a profit, I would need to claim that income here in Mass. where I live.

There is a differnce in using the advantage legally of a loop hole, and exploiting it. When you exploite something for personal gain, it is wrong.

[lawn psycho]

So here's an update on what happened in the case of the man in the original article.

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

[SIKSUKR]

I think the using of loop holes is fine as long as you are doing it with in the letter of the law.
There is a differnce in using the advantage legally of a loop hole, and exploiting it. When you exploite something for personal gain, it is wrong.

Agreed.I would not call doing something illegel a loophole though.

[Ropetow]

I'm guessing that some individuals on this board are or have been employed by a governmental body.

Who in their right mind wants to voluntarily expand the role of our government? Aye, aye, aye, there must be something in the water.....

I'm not a government employee but I am an elected member of my local school board, and it is not easy getting a majority to agree that more spending is not the answer...that it is the problem. Particularly now, with people hurting economically, it should be government's job to provide needed services without adding to the financial woes of the public via higher taxes. Private industry has always been creative in seeking ways to cut costs and increase revenues, and government should be doing the same.

[TOAD]

Private industry has always been creative in seeking ways to cut costs and increase revenues, and government should be doing the same.

:patriot: I agree. The government just keeps taking and adding a burden to an already tax weary public.

[tis]

I heard night before last that the average government employee makes $71,000 before benefits and the private sector average is $40,000. The comment was made we work for the government instead of the government working for us. And it is the same locally, statewide and federally. They don't work for us anymore, we are afraid of them. They assert their power over us. They force things on us we don't want.

[Airwaves]

Orignially posted by lawn psycho
So here's an update on what happened in the case of the man in the original article.

http://www.timesargus.com/article/20...73/1003/NEWS02
I find it disappointing that the reporter didn't ask him why he formed a dummy company in NH in order to purchase the boat in FL in the first place. (or if the reporter did ask then it is more disappointing that the editor cut it) He's not as innocent as he would like us to believe IMHO.

[lawn psycho]

Airwaves, I think you are missing the bigger picture of the article. If Joe Blow from Florida buys his shiny new boat at home, floats it up to Maine for the summer in the Marina and then floats it back to Florida for the winter, he now owes Maine a 5% sales tax.

Bottomline is don't bring your boat to Maine during the first year you have it registered. There were a lot of marina owners who had slips not filled because boat owners did not want to get caught up haggling with Maine trying to prove they were in the state for 30.5 days and subject to sales tax on some very pricy yachts.

[MeEscape]

Let's not underestimate the "simple little" sales tax. As a CPA who resides in Maine, but has boated and owned a cottage on the Lake for many years, I received a letter from the Maine DOR looking for $15,000 in tax because they did a search of USCG records. The boat will never see Maine, maybe the southern New England coast but no tax is due. Even given that it was not a pleasant evening the day I first read that letter. Maine is out of control.

[Rattlesnake Guy]

Let's not underestimate the "simple little" sales tax. As a CPA who resides in Maine, but has boated and owned a cottage on the Lake for many years, I received a letter from the Maine DOR looking for $15,000 in tax because they did a search of USCG records. The boat will never see Maine, maybe the southern New England coast but no tax is due. Even given that it was not a pleasant evening the day I first read that letter. Maine is out of control.

Wait, are you saying that a state with property tax, income tax and sales tax still needs more money?:D

[Airwaves]

Originally posted by lawn psycho
Airwaves, I think you are missing the bigger picture of the article. If Joe Blow from Florida buys his shiny new boat at home, floats it up to Maine for the summer in the Marina and then floats it back to Florida for the winter, he now owes Maine a 5% sales tax.

Bottomline is don't bring your boat to Maine during the first year you have it registered. There were a lot of marina owners who had slips not filled because boat owners did not want to get caught up haggling with Maine trying to prove they were in the state for 30.5 days and subject to sales tax on some very pricy yachts.

No, I think if you look back at what I've written I pointed out his mistake was bringing the boat to Maine for longer than 30 days in the first year of ownership. That's where they got him. However in reading the article that you linked to there is no mention of the fact that the "victim" tried an end run around the sales and use tax by setting up a dummy company in NH whose ONLY function was to purchase the boat.

Now while that in itself is probably not illegal and not enough to trigger the Maine sales and use tax law it certainly points to the intent of the owner of the boat to circumvent the Maine tax.

That's all, just an observation that this guy is not the innocent victim he portrays himself to be and my disappointment in the reporter for missing that fact.

The other issue that has been missed, or at least I don't recall reading it, is the question of what state did the gentleman register or document this vessel through? NH where he formed the dummy company to buy the boat? I will speculate that it is probably NH. Another indication of an attempt at tax evasion but something that I don't believe the reporter(s) wrote about.

[Acres per Second]

I don't understand the dissing of using loopholes. A loophole does not make it illegal. That's just how the tax system is structured. If you don't use every legal loophole available to you then your throwing your money away. As my dad has always told me, it's not what you make, it's what you keep.
I agree fully.

Excerpts from Answers.Yahoo! (http://74.125.93.132/search?q=cache:vdvTOQI4U_IJ:answers.yahoo.com/question/index%3Fqid%3D20070719182659AAzCo79+Massachusetts, +optional-state-income-tax-rate&hl=en&gl=us&strip=1):

"In 2000, voters decided to lower the Mass. tax rate from 5.85% to 5% by a 59 to 41 margin. To appease the voters who voted against the reduction, they put in an option on the tax forms that lets voters pay the old, higher rate.

"People are very predictable. Almost no one choose to pay the higher rate. Typically, people against lowering taxes really want other people to pay higher taxes...not themselves. Of the 3,240,000 returns filed in 2005, only 1,162 opted for the higher rate causing less than $200,000 in extra taxes to be collected. The latest data for 2006 shows that of the 1,540,000 tax returns filed, only 424 people opted for the higher rate. The average income of these people is $20,000.

"I bet if the one could check a box that forces their neighbor to pay a higher rate, more boxes would be checked"

...And...

"41% of the people wanted to keep taxes the same, but now less than 1% of taxpayers opt for the higher rate, leading me to think that most of the people who voted to keep taxes higher are hypocrites."

2) By paying the 5.3% rate, are those 99% of Massachusetts taxpayers "evading" the 5.85% rate? :confused: :rolleye1: