Use Tax in Washington State

I haven’t said much about this on my blog, because I really can’t… but, I’ve been going through an “issue” with the state of Washington.

It’s a LONG story, but when buying Sans Souci, there was a decision to be made about US-flagging, versus foreign country flagging. Many buyers of larger vessels flag their boats “off shore” as a way of avoiding state taxes. I investigated it, and even went down the road a bit — but, then just didn’t like the idea. It felt sneaky, and not my style.

So, I decided to US flag the vessel, and even put Seattle, Wa onto the stern. However, I confess that I still wanted to avoid taxation, and with a darn good reason. I fully expected that my boat would not be in the state of Washington for the forseeable future, so why pay taxes in Washington? Our cruising plans called for Sans Souci to spend essentially all of the next 10 years outside the US.

However, as they say about the best laid plans of men and mice…

I phoned the State of Washington to ask if there were a way to briefly have my boat in the state without incurring a big tax, and was told that the boat could be here for up to five weeks. This sounded great to me, and we built our cruising plan around it.

Unfortunately, an error was made, and I was given bad information. The state acknowledges I was given bad information, and that their website is misleading. The correct interpretation of the law is that once you hit the border, you owe the tax.

A really big tax.

The state said, “It doesn’t matter if you were given bad info, you owe the tax.” So, I paid the tax, and filed an appeal. The state agrees I was given bad and misleading info, but, says “the rules are the rules.” And, perhaps they are right. A judge will make that decision.

I paid the tax, and sent in my appeal, and today received a letter saying my case had been assigned to a judge, who would do some digging into the whole affair, and probably form an opinion sometime in the next year.

It isn’t as good as having my money sent back .. but, at least I’ll have my day in court!

-Ken W

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