Did brief Florida visits during a yacht's first six months of ownership trigger Florida use tax?

Plain-English summary

A Delaware LLC with no Florida-resident members, managers, or officers planned to buy a yacht outside Florida, transfer title outside Florida, document it federally, and register it in Delaware. During the first six months, the yacht would visit Florida for periods not exceeding 90 continuous days or 183 aggregate days in a one-year period. It would then be used continuously in other U.S. states for more than six months.

Florida found that the limited visits did not reach the threshold for importation or commingling with Florida property and therefore did not trigger use tax. But if the yacht's Florida presence required registration under section 328.58, use tax would be imposed.

After six months of use under conditions giving another state taxing jurisdiction, the yacht could qualify for the presumption that it was not purchased for Florida use. The owner needed documentation of the qualifying out-of-state use and any lawfully imposed tax paid there.

What this means for you

The ruling treated the Florida day limits and the six-month out-of-state-use rule as separate conditions. Staying within the visit limits protected the yacht during the initial period; later Florida use depended on substantiating six months of qualifying use elsewhere. Florida registration during the initial period would change the result.

Common questions

Did any Florida visit during the first six months create use tax? No. The stated visits stayed within 90 continuous days and 183 aggregate days in a one-year period.

What event would trigger tax during that period? The ruling says tax would be imposed if the yacht's presence required Florida registration under section 328.58.

What happened after six months of qualifying out-of-state use? The yacht would not be subject to Florida use tax under the stated facts and the six-month presumption.

What records mattered? The owner had to substantiate qualifying use in other states and payment of any lawfully imposed tax there.

Did the boat-related fishing-license exception apply? No on the stated facts, because no saltwater fishing license fee was required directly or indirectly for the yacht.

Citations and references

• Fla. Stat. § 212.06(8) (use tax and six-month out-of-state-use presumption)
• Fla. Admin. Code r. 12A-1.007(2)(a), (9)(b) (out-of-state purchases and Florida boat-presence thresholds)
• Fla. Admin. Code r. 12A-1.091(2)(a) (qualifying out-of-state use)
• Fla. Stat. § 328.58 (recording a vessel number after Florida's reciprocity period)
• Fla. Stat. § 213.22 (Technical Assistance Advisements)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 07A-015

Original ruling text

SUMMARY
QUESTION: Is a boat purchased outside of Florida, and used outside of Florida subject
to Florida’s use tax upon importation into Florida.
ANSWER – Based on Facts Below: If a boat purchased outside of Florida and allowed
to enter Florida during the first six months of the taxpayer’s ownership for limited
periods of time not to exceed 90 continuous days, or an aggregate of 183 days in any one
year period is not subject to the tax.

May 21, 2007

Re:

Technical Assistance Advisement 07A-015
Sales and Use Tax
XXX (“Taxpayer”)
Taxpayer Identification Number XX
Taxpayer’s Address: XX
Sections: 212.02, 212.06, 212.21, and 328.58, Florida Statutes (“F.S.”)
Rules: 12A-1.007 and 12A-1.091, Florida Administrative Code (“F.A.C.”)

Dear :
This is in response to your correspondence to the Department, dated January 9, 2007,
requesting the Department’s issuance of a Technical Assistance Advisement (hereinafter,
“TAA”) pursuant to Section 213.22, F.S., and Chapter 12-11, F.A.C., regarding the
purchase and subsequent importation of a vessel for use or storage for use in Florida. An
examination of your letter established that you complied with the statutory and regulatory
requirements for issuance of a TAA. Therefore, the Department is hereby granting your
request for issuance of a TAA.
ISSUE
Will a federally documented and Delaware registered yacht be subject to any Florida
sales or use tax if allowed to enter into Florida waters within the first six months of the
Taxpayer’s ownership?
FACTS
Your letter provides the following statements of fact:
1.

Taxpayer is a Delaware limited liability company comprised of three
members.

2.

None of the members, managers, or officers of Taxpayer are residents of
Florida.

3.

Taxpayer contracted to purchase XXX (the “Yacht”).

4.

The purchase and sale, including the transfer of title, will take place
outside of Florida.

5.

Post-closing, the Yacht will be federally documented with the United
States Coast Guard and registered in the State of Delaware in the
ownership of the Taxpayer.

6.

Within the first six months of Taxpayer’s ownership, the Yacht will enter
Florida waters for limited periods of use (not to exceed 90 continuous days
or an aggregate of 183 days in a 1-year period).

7.

Thereafter, the Yacht will be used in other U.S. states continuously for a
period in excess of six months.

8.

A saltwater fishing license fee will not be required to be paid on the Yacht
pursuant to Section 372.57(7), F.S., either directly or indirectly.
TAXPAYER POSITION & REQUESTED ADVISEMENT

The pertinent portion of the Taxpayer’s letter of January 9, 2007, provides the following
Taxpayer position:
. . . Our review of the Florida law (as set forth above) supports the proposition
that importation of a vessel into Florida occurs when said vessel either (a)
operates on the waters of the State in excess of 90 continuous days or (b) remains
in the State for more than an aggregate of 183 days in any 1-year period.
Notwithstanding limited use of the Yacht in Florida before completion of the six
month use in other U.S. states, if the Yacht is in fact used in other U.S. []states for
six months or longer, the Yacht will not be subject to any Florida sale or use tax
as a consequence of bringing, using, or storing the Yacht in Florida thereafter.
In support of this position, the Taxpayer cited relevant portions of paragraph
212.06(8)(a), F.S., as well as the germane portions of Rules 12A-1.007 and 12A-1.091,
F.A.C.
The legislature declared that “. . .[t]echnical assistance advisements shall have no
precedential value except to the taxpayer who requests the advisement and then only for
the specific transaction addressed in the technical assistance advisement . . .” (see
subsection 213.22(1), F.S.); still, you respectfully referred to TAA 05A-048, dated
November 18, 2005, TAA 04A-007, dated February 2, 2005, TAA 03A-051, dated
October 28, 2003, and TAA 01A-033, dated June 18, 2001.

The relevant portion of the Taxpayer’s letter of January 9, 2007, provides the following
requested advisement:
Based upon the Florida law cited herein we respectfully request that the
Department rule in the affirmative.
LAW
The declaration of legislative intent for Chapter 212, F.S., tax on sales, use, and other
transactions, is contained in subsection 212.21(2), F.S., and provides in relevant part:
It is hereby declared to be the specific legislative intent to tax each and every . . .
use, storage, consumption . . . levied and set forth in this chapter, except as to
such . . . use, storage, [or] consumption . . . as shall be specifically exempted
therefrom by this chapter subject to the conditions appertaining to such
exemption. . . . (e.s.)
Section 212.02(20), F.S., provides, in pertinent part:
“Use” means and includes the exercise of any right or power over tangible
personal property incident to the ownership thereof, or interest therein . . . .
Section 212.05, F.S. provides, in part:
It is hereby declared to be the legislative intent that every person is exercising a
taxable privilege who . . . stores for use or consumption in this state any item or
article of tangible personal property as defined herein . . . .
(1) For the exercise of such privilege, a tax is levied on each taxable transaction or
incident, which tax is due and payable as follows:

(b) At the rate of 6 percent of the cost price of each item or article of tangible
personal property when the same is not sold but is used, consumed, distributed, or
stored for use or consumption in this state . . . .
Section 212.06, F.S., provides, in pertinent part:
(1)(a) The aforesaid tax at the rate of 6 percent of the retail sales price as of the
moment of sale, 6 percent of the cost price as of the moment of purchase, or 6
percent of the cost price as of the moment of commingling with the general mass
of property in this state, as the case may be, shall be collectible from all dealers as
herein defined on the sale at retail, the use, the consumption, the distribution, and
the storage for use or consumption in this state of tangible personal property or
services taxable under this chapter. . . .

***
(2) . . . (b) The term “dealer” is further defined to mean every person, as used in
this chapter, who imports, or causes to be imported, tangible personal property
from any state or foreign country for sale at retail; for use, consumption, or
distribution; or for storage to be used or consumed in this state. (Emphasis
supplied.)

(d) The term “dealer” is further defined to mean any person who has sold at
retail; or used, or consumed, or distributed; or stored for use or consumption in
this state, tangible personal property and who cannot prove that the tax levied by
this chapter has been paid on the sale at retail, the use, the consumption, the
distribution, or the storage of such tangible personal property. . . .
(4) On all tangible personal property imported or caused to be imported from
other states, territories, the District of Columbia, or any foreign country, and used
by him or her, the dealer, as herein defined, shall pay the tax imposed by this
chapter on all articles of tangible personal property so imported and used, the
same as if such articles had been sold at retail for use or consumption in this state.
For the purposes of this chapter, the use, or consumption, or distribution, or
storage to be used or consumed in this state of tangible personal property shall
each be equivalent to a sale at retail, and the tax shall thereupon immediately levy
and be collected in the manner provided herein, provided there shall be no
duplication of the tax in any event. (e.s.)

(6) It is however, the intention of this chapter to levy a tax on the sale at retail,
the use, the consumption, the distribution, and the storage to be used or consumed
in this state of tangible personal property after it has come to rest in this state and
has become a part of the mass property of this state.
(7) The provisions of this chapter do not apply in respect to the use or
consumption of tangible personal property or services, or distribution or storage
of tangible personal property for use or consumption in this state, upon which a
like tax equal to or greater than the amount imposed by this chapter has been
lawfully imposed and paid in another state, territory of the United States, or the
District of Columbia. . . .
(8)(a) Use tax will apply and be due on tangible personal property imported or
caused to be imported into this state for use, consumption, distribution, or storage
to be used or consumed in this state; provided, however, that, except as provided
in paragraph (b), it shall be presumed that tangible personal property used in
another state, territory of the United States, or the District of Columbia for 6

months or longer before being imported into this state was not purchased for use
in this state. . . . (e.s.)
(b) The presumption that tangible personal property used in another state,
territory of the United States, or the District of Columbia for 6 months or longer
before being imported into this state was not purchased for use in this state does
not apply to any boat for which a saltwater fishing license fee is required to be
paid pursuant to s. 372.57(7), either directly or indirectly, for the purpose of
taking, attempting to take, or possessing any saltwater fish for noncommercial
purposes. . . .
Rule 12A-1.007(2)(a), F.A.C., provides, in part:
(2) Purchases Outside Florida.
(a) There shall be a presumption that any aircraft, boat, mobile home, motor
vehicle, or other vehicle purchased in another state, territory of the United States,
or the District of Columbia but titled, registered, or licensed in this state is taxable
except as otherwise provided in subsection [(25)]of this rule. This presumption
may be rebutted only by documentary evidence that the person owning the
aircraft, boat, mobile home, or motor vehicle purchased the aircraft, boat, mobile
home, or motor vehicle in another state, territory of the United States, or the
District of Columbia six (6) months or more prior to the time it is brought into this
state. In order for such property to be presumed exempt as purchased for use
outside Florida, the person owning the aircraft, boat, mobile home, motor vehicle,
or other vehicle must provide documentary proof that such property was used in
other states, territories of the United States, or the District of Columbia for six
months or longer under conditions which would lawfully give rise to the taxing
jurisdiction of another state, territory, or District of Columbia and any lawfully
imposed tax was paid to such state, territory, or District of Columbia before being
imported into this state. . . . (e. s.)
Rule sub-subparagraph 12A-1.007(9)(b)1.b., F.A.C., provides, in part:
A boat, purchased by its current owner outside this state, operating on the waters
of this state in excess of 90 days, which is solely documented under operative
federal law, or which is registered, licensed, or titled pursuant to a federally
approved numbering system of another state as described in s. [328.58] F.S., is
subject to tax on the sales price of the boat at the time the requirements of s.
[328.58], F.S., have been met.
Rule subparagraph 12A-1.007(9)(b)2., F.A.C., provides, in relevant part:
. . . [A]ny boat which remains in this state for more than an aggregate of 183 days
in any 1-year period shall be presumed to be commingled with the general mass
of property of this state, and tax shall be due on the sales price of the boat . . . .

Rule 12A-1.091(2)(a), F.A.C., provides in part:
The use tax applies to the use in this state of tangible personal property purchased
outside Florida which would have been subject to the sales tax if purchased from
a Florida dealer; provided, however, that it shall be presumed that tangible
personal property used in other states, territories of the United States, or the
District of Columbia for six (6) months or longer under conditions which would
lawfully give rise to the taxing jurisdiction of another state, territory of the United
States, or District of Columbia before being imported into this state was not
purchased for use in this state. For purposes of the presumption set forth herein, it
shall be necessary only that the tangible personal property was used under
conditions which would allow such other state, territory of the United States, or
District of Columbia to impose a sales or use tax on the sale or use of that
property regardless of whether any such tax was actually imposed or paid.
Section 328.58, F.S., provides, in part:
The owner of any vessel already covered by a registration number in full force
and effect which has been awarded:
(1) By another state pursuant to a federally approved numbering system of
another state;
(2) By the United States Coast Guard in a state without a federally approved
numbering system; or
(3) By the United States Coast Guard for a federally documented vessel with a
valid registration in full force and effect from another state
shall record the number with the Department of Highway Safety and Motor
Vehicles prior to operating the vessel on the waters of this state in excess of the
90-day reciprocity period provided for in this chapter. . . .
DISCUSSION
Florida use tax is “ . . . due on tangible personal property imported or caused to be
imported into this state for use, consumption, distribution, or storage to be used or
consumed in this state . . . .” s. 212.06(8)(a), F.S.
Chapter 212, F.S., does not contain a legislatively established “bright-line” test to
determine when tangible personal property is imported in to this state. However, the
administrative interpretation contained in rule sub-subparagraph 12A-1.007(9)(b)1.b.,
F.A.C., imposes the tax on a “. . .boat . . . operating on the waters of this state in excess of
90 days . . . .” Likewise, rule subparagraph 12A-1.007(9)(b)2., F.A.C., supplies a
presumption that “. . . any boat which remains in this state for more than an aggregate of

183 days in any 1-year period shall be presumed to be commingled with the general mass
of property of this state . . . .”
The facts provided in your request dated January 9, 2007, indicate that the purchase of
the Yacht will occur outside Florida. Additionally the facts provided in your request of
January 9, 2007, indicate that the Yacht will be federally documented with the United
States Coast Guard and registered in the State of Delaware, and that within the first six
months of Taxpayer’s ownership, the Yacht will enter Florida waters for limited periods
of use not to exceed 90 continuous days or an aggregate of 183 days in a 1-year period.
Therefore, the Yacht’s presence in Florida for periods of less than 90 continuous days, or
less than an aggregate of 183 days in a 1-year period, does not rise to the threshold of
importation for use or commingling with the mass of property in Florida.
The use tax provisions carry a specific exception to the imposition: “. . . it shall be
presumed that tangible personal property used in another state, territory of the United
States, or the District of Columbia for 6 months or longer before being imported into this
state was not purchased for use in this state.” (e. s.) Section 212.06(8)(a), F.S.
Rule 12A-1.007(2)(a), F.A.C., supplies an administrative interpretation of Section
212.06, F.S. It provides that the person owning a boat purchased outside Florida, for use
outside Florida, must provide documentary proof that the boat purchased outside Florida,
for use outside Florida, was in fact used outside Florida under conditions that would give
rise to the taxing jurisdiction of another state, territory, or District of Columbia.
Additionally, the person owning a boat under the aforementioned conditions must
provide documentary evidence that any lawfully imposed tax was paid to such state,
territory, or District of Columbia before the boat was imported into this state.
If the Taxpayer, upon request, provides documentation sufficient to substantiate the use
of the Yacht in other U.S. states for six months or longer, the Yacht will not be subject to
Florida’s use tax as a consequence of bringing, using, or storing the Yacht in Florida after
its continuous use in other U.S. states for more than six months.
CONCLUSION
Based solely upon the facts as stated in this TAA, Florida sales tax will not be due on the
purchase or transfer of title to the Yacht, because the purchase and transfer of title occurs
outside Florida’s taxing jurisdiction. And the Yacht when used during the first six months
of the Taxpayer’s ownership, and for limited periods of time not to exceed 90 continuous
days or an aggregate of 183 day in any 1-year period, is not subject to the imposition of
Florida’s use tax. If, during this period the presence of the Yacht requires registration
with the state of Florida under section 328.58, F.S., the use tax will be imposed. If the
Yacht is used in other U.S. States for six months or longer under conditions which
lawfully give rise to the taxing jurisdiction of another state, the Yacht will not be subject
to Florida’s use tax.
This response constitutes a Technical Assistance Advisement under section 213.22, F.S.,
which is binding on the Department only under the facts and circumstances described in

the request for this advice, as specified in section 213.22, F.S. Our response is predicated
upon those facts and the specific situation summarized above. You are advised that
subsequent statutory or administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject similar future transactions to
a different treatment from that which is expressed in this response.
You are further advised that this response, your request and related backup documents are
public records under Chapter 119, F.S., which are subject to disclosure to the public
under the conditions of section 213.22, F.S. Confidential information must be deleted
before public disclosure. In an effort to protect confidentiality, we request you provide
the undersigned with an edited copy of your request for Technical Assistance
Advisement, the backup material and this response, deleting names, addresses and any
other details which might lead to identification of the Taxpayer.
Your response should be received by the Department within 15 days of the date of this
letter.
Sincerely,
Jimmy Kalfas
Tax Law Specialist
Technical Assistance and Dispute Resolution
P. O. Box 7443
Tallahassee, FL 32314-7443
(850) 922-4845
Facsimile (850) 921-2983
Record ID No.: 27878