Florida has some of the largest and widest variety of boat dealers in the country. Many people visit Florida to get a good deal on a boat and Florida offers tax benefits to encourage those purchases. However, purchasers from out-of-state need to plan ahead for the potential tax consequences when the boat is registered in the home state. This article discusses the Florida tax benefits available to boat purchasers and what out of state purchasers need to plan for in their home state.

Florida entices nonresidents to purchase a boat in Florida by giving a tax break to those purchasers. Specifically, if a nonresident purchaser comes to Florida, buys a boat, and fills out the correct paperwork, the purchaser does not have to pay Florida sales tax on the boat. The key to obtaining this benefit is the purchase MUST be through a Florida dealer and all the required paperwork must be completed. A dealer is a business that is registered with the Florida Department of Revenue for sales and use tax purposes. Although, even if the purchase is not through a dealer but from a private party, Florida sales tax might not be charged.

What is not necessarily advertised when you purchase your boat is owing a use tax to another state. When a boat is purchased in Florida and then subsequently brought into the purchaser’s home state, the home state’s use tax laws will likely be applied to the purchase. A use tax is similar to a sales tax. While sales tax is charged on transactions occurring within the state, a use tax is meant to tax transactions occurring outside of the state when the purchased goods come into the state. In all actuality, the use tax is predominately at the same rate as the sale tax.

Use Tax Owed in Home State

For use tax purposes, your home state will most likely assess the tax when you register or document the boat. However, the tax will be due when the boat is first brought into the state, regardless of when registration or documentation is done. This experience can be an unpleasant surprise for boat owners, as oftentimes the owner will think the tax was paid previously or rightfully exempt. Even if the tax was paid previously in another state, the owner must prove the tax was paid. If not, then the home state will charge the owner tax. The registration or documentation application may be stopped until the boat owner pays the tax. Boating without that proper registration or documentation could lead to even more problems.

It is critical for soon-to-be boat owners to budget not just for the cost of the boat but also the accompanying tax. That means if a loan is being taken out to purchase the boat, ensure you take out enough to cover the tax on the boat. The tax might not be at the purchase state’s sales tax rate though. Some states have special provisions to limit the amount of tax owed on the boat. In other words, states will charge no more than a certain amount of tax on the transaction. Florida, for example, has such a provision that caps the tax to $18,000. Meanwhile, some states have a flat rate of $300 of tax on the purchase. Still, other states may say you do not have to pay any tax whatsoever. The lesson here is to have proper budgeting of the tax that is owed. To accomplish as much, a purchaser must be familiar with how much his or her home state would tax the purchase of the boat.

Credit for Taxes Paid in Florida

Now, some Florida dealers will have to charge you tax on your purchase in Florida. Most of the time, this tax is labeled as your home state’s tax. However, there may be scenarios in which the tax is listed as “sales tax” or even worse as “Florida sales tax.” It is worse if it is labeled as Florida sales tax because you should not have to pay Florida sales tax on the boat purchase in Florida being a nonresident purchasing from a dealer. If the invoice only has “sales tax” listed on the invoice, there is the possibility your home state will not accept this statement to receive credit for tax paid. Some states specifically require the tax line to identify what state the tax is for. If it does not, the state may say (incorrectly so) the tax is Florida sales tax. Low and behold, you end up getting to pay tax twice! This occurrence has been an unwelcomed surprise for purchasers in the past. Do not let this happen to you.

In lieu of using a dealer, there is the possibility two private parties will get together to complete the transaction themselves. In such a scenario, the purchaser technically owes tax to Florida on the purchase. For a more in-depth discussion on a private party boat purchase, read the article at the end of this discussion entitled “FL SALES TAX VS DMV - BOAT WITH OUTBOARD MOTOR.” Assuming the purchaser pays the tax to Florida on the purchase and brings the boat home, the buyer’s home state may still charge the buyer tax. Some states refuse to give credit for sales tax paid to another state. In effect, this small group of states are forcing their residents to be taxed twice! The states double dip first when tax is paid to Florida and another time when the boat is registered or documented in the home state. I have personally spoken with individuals being taxed twice and to say they are mad is an understatement. So please, be sure also to know whether your state gives you credit for tax paid in another state if you have paid tax in that other state.

Tax Owed in Other States

Taxes may also be owed outside of the purchase and home state. If you are boating in another state, you run the risk of having to pay that state taxes as well. What many boat owners do not realize is that just because you paid tax, you are not always in the clear. While you may be squared away with your home state, other states may try to jump in and take the position that they can tax your boat purchase as well. While some states have very generous provisions to encourage individuals to come with their boat to the state, some states simply do not. If you are found to be boating in these less-than-generous states, the state could have a case against you for taxes on your boat purchase.

For instance, assume you paid tax on your $100,000 boat purchase to your home state at a 6% rate (or $6,000). You decide to take your boat to State B. State B welcomes you to the state, but weeks/months later State B eventually sends you a letter saying you owe 8% tax or $8,000. You prove to State B you paid tax to your home state. State B may reduce your tax bill to $2,000. In other words, if you plan on boating in other states, you may owe tax above and beyond the amount you paid your home state, even taking into account full credit for taxes paid to the home state.

You may be asking yourself how these other states will even find out about you boating in their state. One way might be the Coast Guard. Yes, there are information sharing agreements among the governments of the United States to ensure they can squeeze every last drop of money from you. Getting information from the Coast Guard is just one way. Another avenue might be individuals reporting you to the state in hopes of getting a reward. Some states offer a reward program allowing individuals to report people. The people doing the reporting are given a percentage of however much the state can get from you. These individuals might get your information from the marina while they write down the information of every boat they can find. Finally, if you leave the country and come back through Customs in another state, Customs regularly reports these entrances to the states.


Florida has some of the largest boat dealers and with such high volume of sales, they can offer some of the best prices available. However, when you purchase a boat in Florida, you need to be aware that there may be a sales tax liability upon return to your home state. This tax is called a use tax. Use tax will probably be assessed when you register or document your boat in your home state. If you paid tax elsewhere, you have to prove as much to your home state, or you risk paying tax twice. Even if you paid tax elsewhere, some states do not give credit for tax paid to other states. Knowing how much tax you owe your state is key to proper budgeting as well. As if this was bad enough, if you boat in other states, those other states may try to charge you tax as well! While you might get credit for tax paid to your home state, you may have to pay the difference between your home state’s rate and the other state’s rate. States can find out you have been in their state through a variety of means, most notably via information sharing agreements with out governments.

Florida sales tax attorney; Florida sales tax audit; Florida sales tax audit defense; Tallahassee sales tax attorneyAbout the author: David Brennan is an associate attorney with Moffa, Sutton, & Donnini, P.A. His primary practice area is multistate tax controversy. David received a B.S. in Accounting and Finance, with a minor in Computer Science, from Florida State University. He worked as an accountant for a CPA firm before attending law school at Regent University. He received his Juris Doctor in 2013 and was licensed to practice law in Florida in the same year. In 2015, David earned his Masters of Laws in Taxation from Boston University. While working for the Florida Department of Revenue as a Senior Attorney, David focused on sales and use tax issues for boats, among other areas. You can read his BIO HERE.

At the Law Office of Moffa, Sutton, & Donnini, PA, our primary practice area is Florida taxes, with a very heavy emphasis in Florida sales and use tax. We have defended Florida businesses against the Florida Department of Revenue since 1991 and have over 100 years of cumulative sales tax experience within our firm. Our partners are both CPAs/Accountants and Attorneys, so we understand both the accounting side of the situation as well as the legal side. We represent taxpayers and business owners from the entire state of Florida. Call our offices today for a FREE INITIAL CONSULTATION to confidentially discuss how we can help put this nightmare behind you.


Section 212.05, F.S., Sales, storage, use tax.

Rule 12A-1.007, F.A.C., Aircraft, Boats, Mobile Homes, and Motor Vehicles.


FLORIDA SALES TAX INFORMAL WRITTEN PROTEST, published November 17, 2018, by James Sutton, C.P.A., Esq.

FLORIDA SALES & USE TAX APPORTIONMENT HANDBOOK, published March 28, 2019, by David J. Brennan, Jr., Esq.

FL SALES TAX $60K CAP ON BOAT REPAIRS, published December 7, 2018, by David J. Brennan, Jr., Esq.

FL SALES TAX VS DMV - BOAT WITH OUTBOARD MOTOR, published May 3, 2015, by James Sutton, C.P.A., Esq.

BOAT CAR PLANE DEALERS: FL SALES TAX FORMS, published June 14, 2013, by Jerry Donnini, Esq.