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Buying the boat in an LLC

Old 02-16-2020, 06:50 PM
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Default Buying the boat in an LLC

Is anyone buying and titling their boat in a new LLC for personal liability protection?

Pros/Cons and thoughts on this?
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Old 02-17-2020, 12:57 PM
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Originally Posted by 370ss500efi View Post
Is anyone buying and titling their boat in a new LLC for personal liability protection?

Pros/Cons and thoughts on this?
You'll probably find out the LLC will not protect you from liability based on injury.

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Old 02-17-2020, 01:02 PM
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+1 the LLC is not going to be the one driving and maintaining the boat, you are.

I can see its usefulness if say the boat is well maintained and catches fire that gives rise to an environmental claim or property damages or someone getting hurt.
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Old 02-17-2020, 03:08 PM
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From the standpoint of using the LLC name on a title or coast guard documentation, there is no difference. If your state requires the boat to be registered, the state more than likely will have you show proof you are a member of the LLC. However, I'm thinking you may be looking for legal advice, and that I do not have. If I can assist with any other questions related to titling or coast guard documentation, give us a call or send a PM. Thank you.
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Old 02-17-2020, 08:33 PM
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I had a boat registered in a Corp. Not for liability concerns because I'm certain if someone is injured they will find a way to get you. I did it for taxes. My state would have hit me for over $2K in personal property taxes every year. Having a Corp in another state cost me $200/yr and I registered the boat in that state. (Yes, rules state I should have registered in my state of residence/storage but it was worth the $2k risk to me).
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Old 02-17-2020, 09:09 PM
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No personal experience but a guy I used to work for had this experience:

50+ foot performance cruiser (Pershing)- LLC owned. Captain hired for an afternoon booze cruise, 3 couples including the owner of the boat/LLC. Stop at a local yacht club, while backing into a slip one of the guests was trying to assist/standing on the swim platform/rope in hand. Captain shifted forward to re-position the boat, guy loses his balance and falls off the boat, cracking his head on the floating dock. Coma/surgery and huge lawsuit. Guy sues the LLC (only asset was the boat), sues the captain (no money), sues the yacht club.

Guy who owns the boat/LLC let the insurance lapse, boat has ZERO coverage. At this point his liability is the value of the boat only (owns it free and clear, worth 300-350k, boat is 10-12 years old) but he has to pay the legal fees for the LLC also. Boat ends up with a bad motor, seriously devalues the boat. He parks it, doesn't spend a dollar on it because after all if he loses the boat will be awarded to the plaintiff. Case goes sideways when they figure out the victim has judgments against him for almost a million dollars, guy is a scammer of sorts. Lawyers contact the judgment holders to let them know the payday could be on the way if the guy wins. Guy's lawyer realizes that the big cash windfall probably isn't coming, withdraws from the lawsuit. LLC owner offers to cover 50K of medical and case got settled. Plaintiff/victim got nothing in the end, boat owner kept the boat and paid to fix the motor/clean it up. Lawyers likely got 300K in the end. Story got confusing at the end since the LLC owner/boat owner developed dementia.
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Old 02-18-2020, 06:04 AM
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I had herd that if the boat is in an LLC when it comes time to sell you can sell the LLC, the boat comes with it, and there is no sales tax on buying a business. I have no idea if this actually the case, just something that I herd...
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Old 02-18-2020, 07:33 AM
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^^^ Cannot state whether that is true statement or not. But when I asked my accountant about buying an LLC that had a vessel as an asset he advised against it as you'd be purchasing any past liability's that come with it. I guess it all depends on the risk you'd be willing to take.
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Old 02-18-2020, 07:53 AM
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here is an article

https://www.yourfinancialwizard.com/...cle-ownership/

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Old 02-18-2020, 07:55 AM
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https://www.delawareinc.com/asset-pr...n/boat-owners/
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