Kaimusailing

Warmer weather?

Death and Taxes, a quote from Benjamin Franklin:
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"Our new Constitution is now established., and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes."
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In our case it is the tax on Kaimu, a vessel, which in Maryland is subject to "5 percent excise tax based on fair market value".
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Fair market value is down these days. A boat is a hard sell, but someone who wants to buy a boat is faced with a sea of unsold boats to choose from, and a few newly built boats that have very high price tags. The unsold boats are unsold for a reason. If you buy new, you need a lot of money and a precise guage on what boat you want. You are probably financing the boat and if it meets your desires, the monthly payment is OK, you can live with that. When you buy used, it is always a compromise. You weigh the pros and cons of the boat and the cost of the loan, or if you are paying cash, the knock on the wallet.
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I've said before, a boat can be worth less than zero. A used boat that needs repair goes down in value. One particular item, the engine, is maybe the most expensive part of a boat, even if it is a sailboat. The engine and the drivetrain are expensive items with maintenance costs and very high replacement costs. Other items can also be costly, the sails, a suit of sails, these days, are expensive. The boat's electronic package can be very expensive due to installation costs and the relatively short time before they are obsolete.
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When our tax came up, we used an attorney in Annapolis to handle our excise tax. It was the Lochner Law Firm, located at boatinglaw.com. It is good to review the legal aspects of owning and operating a boat, because each region is different. Probably the best state to operate from is Rhode Island which has no excise tax on boats.
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We were able to adjust the fair market value by providing documentation of repair items on the boat. Wooden boats typically have lower values than fiberglass. It is a good idea to retain any receipts of materials of your project so that if your state has an excise tax, the actual value of materials, and the sales tax paid for them, can be used to argue against the excise assessment. A survey can be used with the instruction to the surveyor that you are not trying to confirm the maximum value for sale or insurance purposes, but a minimum value for a minimum tax.
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One of the items submitted to document reduced value is the current project, the galley portlight with deteriorated cabin side. The picture is of the damaged area with the portlight removed. The damage was caused by the port frame cracking and allowing moisture to seep into the wood of the cabin side. At first it looked like merely a replacement of a small area of inner skin, but as more and more wood was dug out, the extent of the damage increased to include the sheer stringer at the junction of the hull side and cabin side. The exterior sheathing in the area of the port was delaminated and a large portion of the cabin side sheathing was removed. The other portlight on that side of the cabin was removed.
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These portlights are of the opening kind and an obsolete brand PHYC (I think). We never use them as opening ports, the mechanism is getting corroded, the frames are falling apart, let's replace them with fixed ports that don't leak and rot the boat apart. The Wharram Builders and Friends site has lots of suggestions for “window installation”. Not software.
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Another Marchaj book came in at the library, and while picking it up, I ran into Capn Bill, who has a huge Bruce Bingham ketch. He and I often ran into each other before and it was a game of who was going to sail South, but we're both still on the Chesapeake over a long bad winter. His blog is at: http://phoenixketch.blogspot.com/search/label/About%20Phoenix. This is a big boat with lots of internal volume. A Noah's ark with sails. We hope to visit them soon to see how their project is going. Not jealous, no, not a bit....
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