This dream job offers tasty tax-planning opportunities!
The post-punk philosopher and M&Ms enthusiast David Lee Roth once said, “Money can’t buy you happiness, but it can buy you a yacht big enough to pull up right alongside it.” So, if you like big boats and you cannot lie, this week’s discussion will put a salty smile on your face.
Summer is here, which means yachting and yacht sales are in full swing. (Most experts define a “yacht” as any pleasure boat longer than 10 meters, although if you have a friend named Chip, he may disagree.) The National Marine Manufacturers Association reports boat sales hit a 13-year record in 2020, despite (or perhaps because of) the pandemic. That included 341 superyachts reaching 24 meters or more. A year later, new boat inventories are still tight after manufacturers, especially the ones who make the really sexy Italian models, shut down in some cases for months.
You wouldn’t think that people who can afford to spend millions on a toy need any help from the IRS. The U.S. Superyacht Association says that a 180-foot yacht costs about $4.75 million/year to operate, including $1.4 million for crew salaries, $1 million for maintenance and repairs, $400,000 for fuel, $350,000 for dockage, and $240,000 for insurance. But yacht owners have always enjoyed a few tax breaks to help subsidize their expensive hobby. Here’s a quick rundown of the good, the bad, and the ugly:
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Tax Beat is a weekly column with a unique angle: making taxes entertaining. Every week Ed explores the humorous aspects of taxes and current events.
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