Sales, use and excise taxes

Paperwork & ownership · Power & sail

Buying a boat usually triggers a state sales, use or excise tax, generally owed where the boat will be kept and used, even if you buy privately or out of state. Rates, caps and exemptions differ a lot by state. General information only, not tax advice.

How it usually works

• Buy from a dealer or broker in your state and they may collect sales tax. Buy privately or out of state and a use tax is often due when you register the boat where you keep it.
• Some states, Florida among them, credit tax already paid to another state, so you may owe only the difference. Some let a trade-in reduce the taxable price.
• Documented boats aren't automatically exempt; BoatUS notes most states still require sales tax on them. Maryland's excise tax expressly applies to them, and Washington requires documented boats used there to register.
• Show the trailer's value separately on the bill of sale; trailers are often taxed, titled and registered separately.

Three state examples (check current rules)

• Florida: 6% sales and use tax plus any county surtax, which applies only to the first $5,000 of the price, with a cap of $18,000 total per boat (Florida Department of Revenue brochure, revised July 2024).
• Maryland: 5% vessel excise tax on the price or fair market value, minimum $5; the maximum rose to $16,100 on July 1, 2026 (Maryland DNR).
• Washington: sales or use tax, with use tax based on where the boat is moored or stored, plus a yearly watercraft excise tax of 0.5% of fair market value on non-commercial boats 16 feet and over, due each June 30.

Before you buy

• Ask the state where the boat will live how the tax is figured and when it's due; late payment can bring penalties and interest. Florida, for example, gives 30 days after purchase to title and register.
• Nonresident exemptions exist, such as Florida's for boats bought through a dealer or broker and removed from the state on time, but they carry strict paperwork and deadlines.
• Talk to a tax professional before structuring a purchase to reduce tax. Florida, for one, imposes heavy penalties for false nonresident claims.

General guidance for recreational boaters, researched from the sources listed and written in our own words. Your equipment manuals, local knowledge, the Navigation Rules and a qualified instructor come first.