So, what does all of this mean for those wanting to set their boat up as a business in our Boat as a business™  program?

If you would like more general information on our Boat-As-A-Business Plan, and haven't seen the basics yet Go here.

First of all, perhaps nothing!

 Start at the end! That's right this is one set of planning where you start at the end and work forward to now. You need to consider your ultimate goals first. Typically, they may look something like this:
1. I want to retire in 2,3,5,7 years and want to build equity with tax savings and equity.
2. I am a little further out. I'll get an interim boat now, and roll this over (kind of like a like-kind exchange in real estate), and later, convert that second or ultimate boat to personal use.
3. I'm not sure, but like the idea of the management company doing the work while I enjoy the boat when I want and I'll have a plan in place to insure that tax recapture is minimal or non-existent.

The questions you need to ask and get answered include:
1. When is the best time to order so I reach my goals in a timely way?
2. Can I equip it how I want? Keep it where I want? Use it when I want? (Hint, not only can you, you need to in order to qualify for the tax advantages.3. How much 179 or bonus depreciation should I take the first year -- that is, "What is consistent with my exit strategy?" What are the things I need to do to qualify for the active tax advantages?
4. What will the business plan look like?
5. How do I minimize or eliminate my risk of audit?
6. Am I qualified for appropriate financing, and does this approach make sense from a tax point of view?

When you fill out our form, join one of our seminars, or set up a phone or in-person appointment, the answers will become clear and the decision easy. Uncle Sam truly wants to support your new business. That business will help grow the economy and create jobs--just like any other small business--and that folks, represents about 70% of Americas business--exactly the ones that IRS wants to encourage
Meanwhile, these available tax deductions, combined with the potential income available, could cover 80-100% of your boats cost with under 50 days of charter. With available financing and available rebates, your downpayment could be 15-20%, and your cash flow $0!

How might these new tax laws help you?

If/strong>, for any reason, you need a huge tax deduction that can offset income from other sources... For example:
1. You are at the top end of the tax table.
2. You have, or are anticipating a big increase in income this year.
33. You have a huge capital gain from real estate, stock options, or whatever--these deductions can offset your active income and minimizYou purchase a $500,000 boat (and have a marginal tax bracket that would justify a large write off--25% or greater-combined federal/State):
For example, you could take a $250,000 179 deduction
You then get the first years depreciation (based on the last quarter convention, MACRS) 10% of the basis from above--another $25,000.
In other words, a total deduction this year of $trong>254275,000-rong>THIS YEAR!
ButBut, as I said, you can take any portion you need of all of this and you need to factor in your exit strategy. We can show you exactly how it would work, based on your situation.

This year, or next?

No one can tell you what will happen next year. Two things are true:
1. We know what we can count on this year.
2. Because this year's tax advantages are so favorable, boat availability is already getting scarce. You have no time to lose. Get the information you need now--see the ways we can help below.
3. All of the leading economists are predicting substantially greater inflation coming--boats historically go up in price annually at about twice the inflation.

BOTTOM LINE: At least find out what your options are, and how this program can help.

Putting it together...

When you set your boat up as a business you get income and tax advantages. The great thing about our (Boat-As-A-Business ™) BAB plan, compared to a Charter Company plan, is that you only need 5-7 weeks of charter income combined with tax advantages to cover 80-100% of costs. You don't need to charter excessively and have your boat get the wear and tear it receives in a Charter Company Plan. You can have the boat equipped the way you want it and you can use it as much as you like--you do need to find out more about all of this... How much in tax advantages?

From a tax point of view, there are two aspects. Advantages the  first year (when you put your boat into  service) and the longer term benefits. The first year you can qualify for the 179 expense allowance of up to $500,000 + take bonus depreciation, as needed.. See example above.

The new tax stimulus program offers tremendous benefits and tremendous flexibility.

A note on the Charter Company plans--concerning taxes...
The over-riding factor is that in these programs, you must commit to an agreement that turns over control to the management company, and the agreement is for an extended period--constituting a lease. These two factors alone, disqualify you from getting the active tax advantages available in our plan. We'll explain more when we meet.


The first step is to calculate or find your "marginal tax rate". Once you do that, you T size=1>can figure out what your marginal rate will be for the tax benefits to follow, and thus what your tax savings will be.

Tax Calculator

Figure your tax bracket!  Click here. Find your marginal rate now, and then apply as much of the  tax advantage as you like to watch your marginal rate reduce and the effect on reducing your tax liability. For example, say you have $400,000 in income with $100,000 in deductions currently--make the calculation, and then increase your deductions $100,000, $200,000 or more. You can print your results and they will look something like this:
Now you can qualify for the 179 expense allowance of up to $250,000. Use as much as you need, and then use the rest of the tax advantages over subsequent years.

Get the complete information here.

If yIf you want a more detailed business plan and a complete explanation of the tax advantages and how to qualify for them--this includes information that your tax advisor may need to better understand how this program might work for you.