Boat Personal Business Property
According to California Law, vessels and personal watercraft (boats) are taxable and are subject to annual appraisal.
Information on location and ownership is obtained from the Department of Motor Vehicles, the United States Coast Guard, on-site inspections, harbor master reports and other public and private sources.Revenue and Taxation Code Sections 130; 228; 441
Boat owners are required to file an annual Vessel Property Statement must be filed with the Assessor providing details about the boat used in the valuing process.
Boats are taxed in the county where they are usually kept.
About Vessel Assessments
The California Constitution requires that all tangible property be taxable unless otherwise exempted by the Constitution or by the legislature. Tangible personal property is any property, except land or improvements, that may be seen, weighed, measured, felt, or touched, or which is in any other manner perceptible to the senses. Boats are considered tangible personal property.California Constitution Section XIII, Article 1
California Revenue and Taxation Code defines a boat as "every description of watercraft used or capable of being used as a means of transportation on water, but does not include aircraft."Revenue and Taxation Code section 130
The Assessor is required to annually assess of non-commercial boats (vessels) as of January 1.Revenue and Taxation Code section 441(a)
How the Assessor Locates Boats and Other Vessels
The county assessor receives boat ownership information from the State Board of Equalization, other counties, the Department of Motor Vehicles, the United States Coast Guard, marina reports and other public and private sources.
Boat Registration and the DMV
Personal Property Taxes and DMV Registration
The California DMV collects a registration fee for boats. Unlike motor vehicles, property taxes for boats are not paid through the registration fee. The county Assessor determines boat values, upon which the personal property taxes are based.
If You Cannot Register Your Boat With the DMV
The boat may have a prior tax lien filed on it by the county tax collector where the boat was previously registered for failure to pay outstanding property taxes. The county tax collector can put a hold on the registration of the boat with DMV until the taxes are paid. We suggest that you contact both the county tax collector and the county assessor where the boat was previously located for further information on how to resolve the tax problem.
Filing a Vessel Property Statement
What Must be Reported
Boat owners are required to file an annual Vessel Property Statement providing information about the boat such as the year, make, and model of the boat; and the condition of the boat. This information is used to assess the current market value for tax purposes.Revenue and Taxation Code section 445
How Boats are Valued
The Assessor uses various methods to determine a value, including the purchase price of the boat, current condition, improvements or upgrades, and the recent sales of comparable boats in the open market. A recent, arm's length purchase of a boat is considered a good indicator of its true market value.
Failure to file it on time will require the Assessor to estimate the value of your property from other information in the assessor's possession and add a penalty of 10 percent as required by California LawRevenue and Taxation Code section 463
How Often Your Boat is Assessed
State law requires that boats be assessed on the January 1 lien date annually at the tax situs where they are regularly or habitually situated in California
The Vessel Property Statement is not a public document. The information you provide will be held secret by the Assessor. It can only be disclosed to the district attorney, grand jury, and other agencies specified in section 408. Attached schedules are considered to be part of the statement.California Revenue and Taxation Code sections 408; 451
Changes in Boat Ownership
If You Inherit a Boat
Liability for boat property taxes attaches to its owner as of 12:01 a.m. on January 1 each year (the lien date). The bill for the coming tax year is then issued to the owner of record at that time, and that individual, or their estate (if they are now deceased), is liable for the taxes.
If the owner of record on the lien date is now deceased, you should notify the person or entity that is administering the estate so they can pay the taxes due.
Change in Boat Ownership Due to Divorce
If, in a divorce proceeding, a spouse was given sole title to the boat prior to 12:01 a.m. January 1 (the lien date), then that spouse alone would be liable for the tax bill created for that lien date.
If title passed to your spouse after January 1, the bill would be issued to the owner or owners of record as of that date and, if you were both owners on January 1, then the Assessor cannot remove your name.
If your spouse was awarded the boat prior to January 1, but the bill was issued in both your names, then you need to contact the Assessor's Boat division. You will also need to provide us with copies of those court documents which ordered the transfer to your spouse.
If You Sold or are Selling Your Boat
If You Sold Your Boat After January 1
Even though you may no longer own the boat, you are still liable for the taxes because you owned it on the January 1 lien date. Taxes on personal property sold after the lien date is still the responsibility of the seller to pay for that fiscal year.
If You Sold Your Boat Before January 1
The new owner will be responsible for paying the taxes for the new tax year. If you were not the owner on January 1, but the bill was issued in your name, then you should contact the Assessor's Office with the new owner's name, address, date of sale, and location.
If Your Boat is Located Outside of California
Unless permanently moved to another state, a boat documented in California continues to be taxable in California. That is, if the boat is not in California, but is traveling from one place to another and has not become permanently situated in one place outside of California, the boat is still assessable in California.Revenue and Taxation Code section 1140