Is your vessel bill of sale out of date and needs updating? In such a case, one must be aware of the situations in which one is necessary. In today’s article, we will discuss the circumstances in which you must have a bill of sale for your vessel. Read on to get all the knowledge you want, regardless of whether you are an experienced boat owner or just getting started in the hobby! When purchasing or selling a boat, there is specific paperwork that, once signed, needs to be submitted to make the transaction legally binding. The bill of sale for the vessel is one example of such a document. This document demonstrates that the buyer and seller have reached an agreement about the sale of the boat, and it also transfers ownership of the vessel to the new owner. The following are some instances in which you are obliged by law to have a vessel bill of sale:
When Buying or Selling A Used Boat
You are required to get a bill of sale from the boat’s former owner in the event you either acquire or sell the vessel. According to icrc.org, anyone who buys a secondhand boat in the United States is required by federal law to be presented with paperwork about the boat’s history and place of origin. This protects the new owner from any possible liens that may be filed against the yacht, and it also helps prevent you from being held liable for any troubles that may have arisen with the loan taken out by the prior owner. You run the danger of losing your title (if there are still liens on the boat), and you also run the risk of being unable to register your newly purchased vessel with the state if you do not have a bill of sale. Before moving forward with any purchase, you need to be sure that you have checked the exact criteria with the Department of Motor Vehicles in your state.
When Transferring Ownership Between Family Members
The law mandates that you have a vessel bill of sale when transferring ownership amongst family members. Depending on where you reside, the legal terminology for this bill of sale, which may be referred to as a “Certificate of Ownership,” a “Transfer on Death Deed,” or a “Bill of Sale,” might differ. They all have the same basic structure, though, in that you and your family sign them. Your children should have written confirmation that you transferred the boat to them when they are old enough to do so. When an accident occurs or the boat’s registration has to be amended, the owner must provide this written documentation if the boat is involved. If you decide to sell your yacht in the future, it is a good idea to have this agreement on hand. Your loved ones can’t show ownership if you don’t provide them with a vessel bill of sale. If they don’t own it, they can’t sell it!
When Transferring Ownership as Part of a Divorce Settlement
If you are transferring ownership as part of the terms of your divorce settlement, you will need to have your attorney make a document on your behalf. Additionally, you will want a vessel bill of sale if you transfer ownership from an adult parent to an adult child. Before the parents pass away, the title should be transferred to the child as quickly as feasible. The vessel’s new owner will not be required to pay any federal capital gains taxes because of the transfer, and they will also be allowed to take advantage of the vessel’s depreciation schedule. Before putting up this contract, it is also recommended that parents seek the advice of an attorney specializing in estate planning. This will allow the parents to guarantee that their affairs are in order if they pass away.
You Require a Vessel Bill of Sale When Titling a Newly-Built Boat for The First Time
When applying for a boat title for the first time with a newly-built vessel, you will undoubtedly be required to present a bill of sale from the boat’s manufacturer. Before the buyer may register their new title with the Maritime Documentation Center, they must first receive a bill of sale from the seller if the ownership is being transferred from one member of the same family to another. It is always preferable to be prepared if you are asked to give this document, even if it may not be necessary for all situations to possess this document in your possession. If you do not have this paperwork and need one, you should get in touch with a boating attorney who will be able to assist you as soon as possible and in the most efficient manner.
When is it required to have a vessel bill of sale? The U.S. Coast Guard has made it easy to understand the rules and regulations when purchasing a new or used boat. We are happy to help you locate and complete a vessel bill of sale, contact the Maritime Documentation Center today at 800-535-8570 for more.