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July 18, 2005

How To Avoid Pitfalls When Buying Used Boats

Extra! Read All Aboat It!

AUSTIN, Texas — The transfer of boats and motors appears to be getting sloppier, with more and more people not getting titles, some sellers altering sale prices on transfer documents to avoid higher taxes and others who are inadvertently purchasing stolen crafts. So game wardens want to advise people to treat the buying or selling of a boat like they would that of an automobile.

“We see people buying boats at garage sales and receiving no paperwork and wanting to transfer it to their name,” said TPWD game warden Tony Norton of Henderson County. “You wouldn’t buy a car without getting the title.”

If the seller doesn’t have a title but has proof of boat ownership, they can request a duplicate title and then transfer it over to the buyer. The penalty for not transferring a title is a fine of as much as $500. And without a title, the boat can’t be registered.

It could be worse.

“What if somebody steals it? They have to come up with proof they own the boat and a lot of them can’t,” said a member of TPWD’s Marine Theft Unit.

Another common mistake is getting a title but not completing the boat transfer and motor transfer forms correctly. The forms can be obtained at any TPWD office or at (http://www.tpwd.state.tx.us/boat/forms.phtml). A separate transfer form must be filled out for the outboard motor title. There is a civil tax penalty and a fine for not registering and paying the sales tax on the boat and outboard motor within 20 days of purchase.

Since boat registrations are good for two years, some people may have boats for as long as 18 months before they try to register the boat in their name and by then, it may be impossible to track down the previous owner and get a bill of sale to prove it was a legitimate transaction.

Most people don’t worry about it until the registration expires. Then they realize what a mess it is.

Another common violation is people selling boats without endorsing the title in the first place. They thereby skip paying taxes on the boat -another violation punishable by a fine of as much as $500.

Norton says he also sees changes made in the tax affidavit sections on transfer forms, (title applications). “They change the price of the boat so they don’t have to pay as much tax,” he said.

Title applications are government documents and falsifying information or altering them for financial gain is a felony, according to TPWD.

“Because people see boats as toys, they don’t put as much importance on the titling process as they do with cars,” said a TPWD marine official. “People don’t realize that when they alter documents to save a couple hundred bucks, and those documents are presented to us and processed a felony has been committed,” he said. And that violation is punishable by as much as 2-20 years in prison and/or a $10,000 fine.

KE 2005-07-18


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