Buying and selling private

Blueone

Blueone

Well-Known Member
SILVER Sponsor
Jan 24, 2007
13,822
Lake Erie, Ohio
Boat Info
2004 420 Sundancer
Engines
Cummins 6CTA 450's
I have never done this before. If you are selling to a private buyer and buying from another private seller…. Is there anyway to minimize the taxes buying a more expensive boat?
I’m thinking maybe go through a dealer or broker maybe?….
 
I have always bought and sold thru a broker/dealer. Let them deal with the tire kickers, cant get financing, or wanna dicker on price for a month. It’s worth the 10%.
Here’s my boat, here’s where to send the check. Done.
 
Blueone said:
I have never done this before. If you are selling to a private buyer and buying from another private seller…. Is there anyway to minimize the taxes buying a more expensive boat?
I’m thinking maybe go through a dealer or broker maybe?….
Click to expand...

You doing this in MI or OH?

In MI they passed a law a decade or so ago that enables a consumer to only pay tax on the difference in value between the boat they sell/trade and the boat they buy. STOD - sales tax on the difference. The kicker, it's only good when working with a dealer. They technically have to take the boat on trade...even if they immediately resell it.
 
Stee6043 said:
You doing this in MI or OH?

In MI they passed a law a decade or so ago that enables a consumer to only pay tax on the difference in value between the boat they sell/trade and the boat they buy. STOD - sales tax on the difference. The kicker, it's only good when working with a dealer. They technically have to take the boat on trade...even if they immediately resell it.
Click to expand...
buying in Michigan selling in Ohio
 
Pirate Lady said:
I have always bought and sold thru a broker/dealer. Let them deal with the tire kickers, cant get financing, or wanna dicker on price for a month. It’s worth the 10%.
Here’s my boat, here’s where to send the check. Done.
Click to expand...

Paying a broker 10% commission has exactly 0% to do with state sales tax...
 
Blueone said:
Actually both buying in Michigan selling in Ohio
Click to expand...

I don't know about OH but this whole STOD thing might get tricky between states, even if you do work with a dealer. Sales tax is 6% in MI, what's the going rape rate in OH?
 
Sales Tax?
Here in Fl sales tax gets paid either through a broker or when the boat is registered.
The sales tax is based upon the invoiced value and/or the NADA fair market value.
The only way sales tax gets offset is if an owner trades a boat in for another and the invoicing / bill of sale indicates net cost offset to the owner between the two; in other words, your final invoicing.
The question is - can you sell your boat then buy another and offset the new boat between the two independent transactions? Not so sure.

I purchased my 52DB and still owned my 400DA. Within a week the same brokerage I bought the 52 through had a contract on my 400DA and it sold within two weeks. I'll have to look but I think they pulled my contract on the 52DB back and reissued showing the 400DA as an offset. But that was the same brokerage on the same contract and not a private sale.
 
ttmott said:
Sales Tax?
Here in Fl sales tax gets paid either through a broker or when the boat is registered.
The sales tax is based upon the invoiced value and/or the NADA fair market value.
The only way sales tax gets offset is if an owner trades a boat in for another and the invoicing / bill of sale indicates net cost offset to the owner between the two; in other words, your final invoicing.
The question is - can you sell your boat then buy another and offset the new boat between the two independent transactions? Not so sure.

I purchased my 52DB and still owned my 400DA. Within a week the same brokerage I bought the 52 through had a contract on my 400DA and it sold within two weeks. I'll have to look but I think they pulled my contract on the 52DB back and reissued showing the 400DA as an offset. But that was the same brokerage on the same contract and not a private sale.
Click to expand...
Thats what I am saying....I feel like I need to go thru a broker or dealer even though I have two private sales
 
Good question. The only way I know of to do this is if your current boat is shown on the purchase agreement for the new boat. Meaning, both boats need to be on the same invoice to show the "difference" for tax purposes. I'm not sure how you would do that with two independent private sales.
 
ttmott said:
Sales Tax?
Here in Fl sales tax gets paid either through a broker or when the boat is registered.
The sales tax is based upon the invoiced value and/or the NADA fair market value.
The only way sales tax gets offset is if an owner trades a boat in for another and the invoicing / bill of sale indicates net cost offset to the owner between the two; in other words, your final invoicing.
The question is - can you sell your boat then buy another and offset the new boat between the two independent transactions? Not so sure.

I purchased my 52DB and still owned my 400DA. Within a week the same brokerage I bought the 52 through had a contract on my 400DA and it sold within two weeks. I'll have to look but I think they pulled my contract on the 52DB back and reissued showing the 400DA as an offset. But that was the same brokerage on the same contract and not a private sale.
Click to expand...

Yeah, that's how the MI law reads as well. Prior to 2013 in MI you paid the full 6% even if you traded something in to offset the purchase price of the new boat.

I was looking at a 500 in the fall and the dealer informed of this potential offset if they also list/sell my 400. I'm not sure the particulars, but it sounds like they may be skirting the edges of the law when they do it this way. Which I was going to be okay with :)
 
Stee6043 said:
I don't know about OH but this whole STOD thing might get tricky between states, even if you do work with a dealer. Sales tax is 6% in MI, what's the going rape rate in OH?
Click to expand...
You know my boat is registered in Michigan and looking at buying a Michigan boat…. I have one or two friends at dealers in Michigan. I’ll ask them
 
Buy or sell a boat privately here in GA….pay no sales tax. We bought the 420DA on a private sale in FL, registered in GA, paid no Ssles Tax. Use a broker or dealer, you will pay sales tax here.

Bennett
 
I sold a boat to a private buyer and the buyer wanted me to lie about the selling price so he could avoid some sales tax. I refused to do that. I did give him the title when his check cleared and did not put the selling price on the old registration. He must have perjured himself to the Secretary of State when he renewed the registration because the SOS collects the sales tax. That was in 1986. I believe the procedure has been revised because more recently I read up on selling used cars and boats. Now the seller needs to keep a copy of the transaction including selling price and related details to accurately determine sales tax. Failure to do so is punishable. It’s not worth the hassle in Michigan to lie about sales tax in my view. The State is pretty good at detecting evasion, and has a pretty good idea of values when it comes to cars. Boats…maybe not so much. However, it’s probably not worth dodging the tax when you consider the penalties and interest for the few bucks involved if audited. Then there is the ethical issue as well.
 
sbw1 said:
I sold a boat to a private buyer and the buyer wanted me to lie about the selling price so he could avoid some sales tax. I refused to do that. I did give him the title when his check cleared and did not put the selling price on the old registration. He must have perjured himself to the Secretary of State when he renewed the registration because the SOS collects the sales tax. That was in 1986. I believe the procedure has been revised because more recently I read up on selling used cars and boats. Now the seller needs to keep a copy of the transaction including selling price and related details to accurately determine sales tax. Failure to do so is punishable. It’s not worth the hassle in Michigan to lie about sales tax in my view. The State is pretty good at detecting evasion, and has a pretty good idea of values when it comes to cars. Boats…maybe not so much. However, it’s probably not worth dodging the tax when you consider the penalties and interest for the few bucks involved if audited. Then there is the ethical issue as well.
Click to expand...
Who said anything about lying ??
 
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