Would you love to own a new boat but wish you could avoid some of the costs of ownership?
Are you afraid you may not use your boat enough to justify the investment?
Do you get frustrated when thinking of your boat sitting in the slip all week and still costing you money?
Charter ownership programs are an intelligent way to own a new boat!
Clearly boating is a fantastic, enjoyable, and exciting activity ¿ and we all wish we could buy our dream boat and sail every day. But that simply isn't a reality for most of us. While there are always affordable used boats available and many ways to keep the cost of boating low, that isn't really the dream we have in our minds.
The three main reasons that prevent many from buying a new boat are:
- Cost -- can I afford the total cost of boating?
- Time -- will I use the boat enough to justify the expense?
- Hassle -- do I really want to deal with cleaning, maintaining, and hauling the boat?
A smart charter ownership program can address all of these concerns and make boating affordable, intelligent, and carefree.
Owning a "charter" boat ¿ whether it be in a traditional charter program, school/club, or fractional membership organization ¿ provides the freedom and excitement of owning a boat of your own while addressing the 3 main concerns above:
- Cost -- these programs provide an income to you and often cover the boat's operational expenses
- Time -- when you are not able to enjoy the bat, it is generating income for you
- Hassle -- such programs offer professional yacht management to handle cleaning, maintenence, and repairs
These benefits of an income-producing charter plan make boat ownership intelligent and financially responsible. They remove the traditional burdens of ownership while still allowing you to enjoy a new boat of your own with flexible usage. Plus, you maintain the potential tax and other financial benefits of ownership, much like the benefits of owning a home versus renting.
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How they Work
Plans vary from company to company, but most follow a similar pattern. You purchase a boat through the charter company and the local boat dealer. You sign a charter management agreement with the company whereby they agree to care for your boat and share with you a portion of the revenue that the boat generates. This revenue will typically cover the operating costs of the boat and some or all of your loan payment. In some cases, you may even earn more than all of the boat costs, allowing you to put some money in your pocket as well. You and the management company divide up the time in some manner, which is typically tracked in a calendar system. You use the boat when you want, and the charter company uses it when you can't, thereby generating your revenue.
For an overview of a few of the options available in charter ownership models, read our presentation "Alternatives to Traditional Boat Ownership" available for free.
In addition to your revenue share, you can also benefit from some tax advantages. In many states, boats that are going into charter are not subject to sales tax because the charters themselves are taxed. This alone could save you $10,000 or more.
A typical cruising boats qualifies as a second home and you can deduct your mortgage interest on your income tax return just as you do for your primary residence.
Section 179 of the IRS Tax Code also allows you to both deduct and accelerate depreciation on qualifying new equipment purchased for business. This has the effect of dramatically reducing your tax burden the year you purchase the equipment. In some cases, this benefit may apply to a boat purchased for a charter program. This could save you thousands or even tens of thousands of dollars on your income taxes. We are not tax professionals so you will definitely want to discuss these tax items with your accountant or tax preparer.
Options with our Partners
SailTime Boston is the Massachusetts base of a global sailing network. SailTime offers an intelligent ownership program wherein you own the boat and SailTime pays the expenses, provides an income, and takes care of the boat. You purchase a new boat, making the down payment and qualifying for any financing. You "lease" the boat to SailTime. SailTime covers the cost of slip, insurance, storage, and regular maintenance, plus shares with you all income that the boat generates. This extra income can be used to make the loan payments. SailTime finds a limited number of qualified members to share the boat. All members use a real-time, online calendar to schedule use.
This program offers the owner the ability to avoid regular boat expenses plus enjoy an income while still getting on the water up to a week each month.
SailTime Boston will only accept new Hunter sailboats and Rinker and Albin power boats in its fleet. Further details can be found on the SailTime Owner-Member page.
Black Rock Sailing School
Black Rock Sailing School is Boston's premier, award-winning sailing school and club. They offer a full suite of ASA sailing courses as well as a sailing club, captained charters, and bareboat charters in both Boston and the Caribbean. BRSS is seeking young, modern cruising sailboats for use in its fleets here in Boston and in the Virgin Islands. When not being used by the owner, the boats are used in cruising courses, captained charters, and optionally bareboat charters. Boats can berthed in Boston, the Virgin Islands, or move between the two seasonally. Black Rock pays a portion of the expenses and splits income with the boat owner.
This program offers incredible flexibility to balance owner use and income, the safety of always having a captain aboard, and the ability to sail in New England or the Virgin Islands.
Narragansett Sailing offers a diverse charter fleet in Narragansett Bay. They are always seeking sailboats that are clean and well-maintained for their fleet. Their program includes a healthy owner income from charter bookings along with complete cleaning and maintenance from their dedicated staff. Owners have complete control of when their boat is available for charter, allowing you to customize usage and income to your needs.
Find Out More or call us at 978-463-3663 to discuss the details of these income-producing ownership programs.