Search Category: Transportation
Sales of Boats and Trailers by Dealers and Retailers
Sales price
Dealers and retailers must collect sales tax on the sales price of boats and trailers at the time of the sale unless an exemption applies. Items that are nontaxable aren’t part of the sales price. The final amount you charge your customer can include both taxable and nontaxable items.
What sales price includes
Sales price includes the following items, even if you separately state them on the invoice:
- Freight or shipping charges to transport the boat or trailer to the seller before the sale
- U.S. federal excise tax imposed on the manufacturer, wholesaler, or importer before the sale
- All options and accessories (e.g., GPS system, depth finder, upgraded features, theft-deterrent systems)
- Services, including charges for labor the dealer or retailer provides as part of the sale agreement (e.g., painting, coating, rust proofing, washing, waxing, cleaning, lettering)
Note: See exemptions for service charges on certain new vessels sold by dealers as of July 1, 2019, below. - Labor charges before the sale (e.g., installation, fabrication, repairs required by the buyer including both parts and labor)
Note: See “Exemption for labor to install accessories on new vessels,” below (effective July 1, 2019). - Mandatory service and warranty agreements
- Dealer documentation, credit card and other service fees
- Insurance settlements used to buy a replacement boat
- Manufacturer’s rebates
- Auction fees (e.g., gate fees, buyer’s fees, seller’s premiums)
What sales price doesn’t include
The sales price doesn’t include the following items if you separately state them on the invoice:
- Retailer’s discounts or rebates
- Title and registration fees a government agency imposes
- Optional service and warranty agreements
- Finance charges (e.g., loan origination fees, interest)
- Optional insurance (e.g., Gap insurance)
Note: A customer down payment doesn’t reduce the taxable sales price.
Exemption for labor to install accessories on new vessels
Effective July 1, 2019, dealers’ labor or service charges to install accessories on certain new factory-delivered vessels are exempt.
The exemption covers vessels that fall into any of the following categories:
- Sold with a motor
- 11 feet or more
- Canoes, kayaks, paddleboards and inflatable boats and similar watercraft that are at least 11 feet long and sold with a motor
Examples of labor installing accessories on new factory-delivered vessels that qualify for the exemption are:
- Storage racks
- Sealant, hull protectant, waterproofing
- Sound systems
- Anti-theft devices
- Boat covers; bimini tops
Note: “Accessories” doesn’t include service or maintenance contracts.
Reference: Idaho Code section 63-3622OO, effective July 1, 2019.
Trade-in allowances
You can accept merchandise as full or partial payment of a boat or trailer you sell. The amount allowed on the traded-in merchandise reduces the taxable sales price, which is the amount you charge tax on.
- You must put the traded merchandise into your resale inventory.
- The trade-in and all documentation must take place at the time of the sale. If not, the trade-in allowance doesn’t reduce the taxable price.
Note: You can accept manufactured homes or modified park model recreational vehicles as trade-ins, but they don’t reduce the taxable price.
A leased boat or trailer you accept as a trade-in reduces the taxable sales price if both these criteria are met:
- The customer has paid the lease in full.
- The customer paid sales tax on the buyout of the lease.
Read this chart to see what is and isn’t included in the calculation of taxable sales price: 
Vehicles and Vessels: Taxable Sales Price.
Exempt sales of boats or trailers by dealers and retailers
Most people must pay sales tax when they buy boats and trailers in Idaho. Only a few can buy boats and trailers tax exempt from Idaho dealers and retailers. Certain conditions must apply.
You could be held responsible for paying the sales tax yourself if you don’t collect it when you should.
Idaho buyers
Individual buyers don’t qualify for any exemption if they provide an Idaho driver’s license, Idaho address or Idaho contact information.
Military buyers
A military member who buys a boat or trailer to use in Idaho must pay tax even if Idaho isn’t the member’s state of residence.
Nonresident buyers
A nonresident can be an individual, a company or organization. A business or organization is a nonresident if it’s not formed under Idaho laws, isn’t required to register with the Idaho Secretary of State to do business in the state, doesn’t have significant contacts with Idaho, and doesn’t have consistent operations in Idaho.
A nonresident that buys a boat or trailer for use outside Idaho might qualify for an exemption if all of the following apply:
- The boat or trailer is intended for use outside Idaho and won’t require titling in Idaho.
- The nonresident will take it out of Idaho and immediately register and title it (if required) in another state or foreign country.
- It won’t be used in Idaho for more than 90 days in any consecutive 12-month period. (A day of use in Idaho is 16 hours during any 24-hour period.)
If the criteria above are met, an exemption can apply to:
- Vessels with an attached motor, regardless of length
- Vessels without a motor, 11 feet or more in length (Exception: paddleboards, inflatable boats, canoes, kayaks or similar watercraft are taxable if purchased in Idaho.)
- Transport trailers
The exemption doesn’t apply to accessories that aren’t part of the boat or trailer bought in Idaho (e.g., life jacket, tow ropes, wakeboard).
A nonresident that buys a boat or trailer to take out of state doesn’t qualify for the exemption if an Idaho resident is included as one of the following:
- Co-buyer on the sales invoice or retail purchase agreement
- Co-borrower on loan applications
- Co-applicant for title or registration
- Party on any other sales documents
Each nonresident buyer must give you a completed Form ST-104NR – Sales Tax Exemption Certificate – Nonresident Vehicle/Vessel. Keep the form for your records, and forward a copy to the Tax Commission in one of these ways:
- Scan and email to: vehicles@tax.idaho.gov.
- Mail to: Idaho State Tax Commission – Tax Discovery Bureau, PO Box 36, Boise ID 83722-0410.
Government agencies, schools, some nonprofit organizations and American Indian tribes
Buyers listed below are exempt from sales tax on everything they buy, including boats and trailers.
- U.S. federal government agencies
- Idaho state and political subdivisions (such as cities and counties)
- Public schools
- Some nonprofit schools
- Certain nonprofit and health organizations specifically exempted by Idaho law (e.g., nonprofit hospitals, qualified health organizations)
- American Indian tribal governments and tribal-owned entities
These agencies and organizations must give you a completed Form ST-101 – Sales Tax Resale or Exemption Certificate>. Keep the exemption certificate for your records. The exemption doesn’t apply to buyers who are employees purchasing an item for personal use and not on behalf of the exempt agency. You could be held liable for the sales tax on taxable purchases if you don’t collect it.
Note: For a complete list of exempt agencies and organizations, see our Exemptions guide.
Members of American Indian tribes
The laws for buying a boat or trailer tax free are different for individual members of American Indian tribes than for the tribes themselves. Tribal members must take delivery of the boat or trailer on a reservation for the sale to be exempt from sales tax.
The buyer must give you, the dealer or retailer, a completed Form ST-133 – Sales Tax Exemption Certificate – Family or American Indian Sales. Keep the form for your records. Your records must clearly show that you delivered the off-highway vehicle to the reservation. Otherwise, you could be held liable for the sales tax.
This chart lists all available vehicle and vessel sales/use tax exemptions including boats and trailers: Vehicles & Vessels: Exemption Certificates.
Servicing boats or trailers by dealers and retailers
Repair work for off-highway vehicles takes many forms.
This Vehicles and Vessels: Repairs chart explains how to buy, bill and charge tax on parts used in different types of off-highway vehicle repairs in Idaho, including repairs under warranty.
Read Boat repair, including winterization fees for more information.
Note: You owe tax on the tools and shop supplies you buy for making repairs.
Boats and Trailers Brought into Idaho
Sales tax might be due if you bring a motor vehicle or motorized vessel into Idaho.
Individuals
When tax is due
- You’re an Idaho resident Note: You might be able to reduce the amount of Idaho tax if you paid sales tax in another state. Keep your receipt.
- You owned a boat or trailer for less than 90 days before moving to Idaho
- You’re a member of the military, temporarily stationed in Idaho (Exceptions: See immediately below.)
When tax isn’t due
- You’re a new Idaho resident and you owned or acquired the boat or trailer more than 90 days before moving to the state, see Form ST-102 – Use Tax Exemption Certificate, New Resident
- You’re an active member of the military, with a home of record other than Idaho, and either of the following is true:
- You owned or acquired the boat or trailer before you received orders to transfer to Idaho
- You owned or acquired the boat or trailer more than 90 days before moving to Idaho
Form ST-102NM – Use Tax Exemption Certificate, Nonresident Military, when you register the boat or trailer in Idaho. Businesses
You owe tax on boats and trailers you own and move into Idaho if both of the following are true:
- They’re titled in the name of a business entity
- Any sales tax you paid was less than Idaho’s sales tax rate
You owe tax on the fair market value of the boat or trailer when you first use it in Idaho.
Tax you properly paid to another state can offset the tax you owe in Idaho with credit for sales tax paid to that state.
Special rules apply to transient equipment. (See Sales Tax Rule 073.)
Aircraft
If you’re thinking of buying or selling an aircraft in Idaho, you may have some questions about registration and taxes. The Idaho State Tax Commission and the Idaho Division of Aeronautics have partnered to provide you the information you need to help make your aircraft transaction (sale, lease, or purchase) and registration a success.
When aircraft can be sold or purchased tax exempt
There are some cases in which the sale of an aircraft may be exempt.
- The customer is exempt from all taxes (like the U.S. government).
- The aircraft will be used primarily to transport passengers or freight for hire.
In this case the exemption applies to:- Commercial airlines,
- Air ambulance services, and
- Charter flight businesses.
The exemption doesn’t apply to:
- Hot air balloons,
- Gliders, and
- Other recreational craft.
- The aircraft will be used primarily for agricultural spraying, dusting, seeding, livestock and predatory animal control, or forest and wildlife conservation.
- Aircraft sold to nonresidents — even if delivery is taken in Idaho — if the buyer certifies that the aircraft:
- Will be taken directly out of Idaho and immediately registered in another state or nation, and
- Won’t be required to be registered under Idaho laws, and
- Won’t be used or stored in Idaho more than 90 days in any 12-month period.
- Aircraft purchased by aircraft dealers for resale (see Resale Exemption).
To buy tax exempt, the customer must complete and sign Form ST-134AC – Sales Tax Exemption Certificate Aircraft – Exempt Use or Form ST-134NR – Sales Tax Exemption Certificate Aircraft – Nonresidents. See our Retailers and Wholesalers guides.
What you can buy tax exempt
Registered dealer
If you’re a registered dealer making a purchase for resale, you must give your supplier a completed form ST-101. Once the supplier has your ST-101 on file, you can buy aircraft and any parts needed for their repair exempt from tax, as long as the items are held in inventory for resale.
Retail sales
As a retailer, you can sell an aircraft, its repair parts, and oil exempt from sales tax if your customer is holding the aircraft for resale, rental, or lease in the normal course of business. In this case, your customer must provide you a completed form ST-101.
When use tax is due
Use tax is a tax on goods that you put to use or store in Idaho. If you haven’t paid sales tax on these goods, you owe use tax (unless the items are held for resale or an Idaho exemption applies). If you’ve paid the correct sales tax to another state — at least equal to or greater than Idaho’s tax — you don’t owe use tax. The sales tax must be separately stated on your receipt. The use tax rate is the same as the sales tax rate. Use tax is paid to the state using Form 850-U – Self-Assessed Use Tax Return and Instructions.
Purchases by aircraft dealers
You must pay tax when you buy items that will be used by your business rather than being held for resale. If your vendor didn’t charge sales tax, you owe Idaho a use tax. Any item you originally purchased for resale but withdrew from inventory for business or personal use is also subject to use tax. You pay use tax to the state using your regular sales tax return.
Aircraft leases
If the sale of the aircraft is considered taxable, then the lease of the aircraft is also taxable. For more information on leases, see our Renting and Leasing Tangible Personal Property guide.
How tax applies to aircraft used for flight instruction
Aircraft used primarily for flight instruction aren’t considered to be held for resale, so their purchase is taxable (as are their parts and oil). When aircraft held for resale are used for flight instruction, a reasonable fair rental value must be established for the aircraft use, and the business giving the instruction must pay use tax on that value.
The purchase of the flight instruction by a student isn’t subject to sales tax.
How tax applies to aircraft used for flying services
The purchase of aircraft used primarily for flying services, such as recreational flights, is taxable (as are the aircraft parts and oil). Recreational flights include balloon rides, sightseeing, wildlife viewing, and similar activities.
Applying tax to runways (instead of roads)
For more information
- Idaho Code sections 63-3608, 63-3609, 63-3610, 63-3611, 63-3622GG, 36-6312, 36-3614
- Sales Tax Administrative Rule 037: Aircraft and Flying Services
- Sales Tax Administrative Rule 038: Flying Clubs
Boats, Trailers, and Other Watercraft
This guide explains sales and use tax requirements for buyers and sellers of boats and trailers.
Basics Guide
Brought into Idaho
Boats and trailers bought in another state and brought into Idaho
Dealer Sales
Sales of boats and trailers by dealers and retailers
Dealer Leases
Leases and rentals of boats and trailers by dealers and retailers
Private Party Sales
Sales of boats and trailers by private parties
Private Party Rentals
Leasing out or renting out your own boat or trailer
Donating
Donating or giving away a boat or trailer
Repairs
Boat repair, including winterization fees
Sales on Water
Sales and services provided on navigable waters
Boat Docks
Boat dock installation or repair
Recordkeeping
Laws and Rules
Ground, Air, and Railroad Businesses
Basics Guide
Ground
For ground transportation companies
Air
For air transportation companies
Rail
For railroad transportation companies
Sales to Passengers
Sales to passengers are taxable
Complimentary Items
Complimentary items are taxable
Motor Vehicles
Dealers
For motor vehicle dealers
Nondealers
For nondealer retailers and private parties
International Registration Plan (IRP) Vehicles
This guide explains Idaho’s sales and use taxes for IRP vehicles.
Basics Guide
Buying Exempt
Buying exempt for an IRP fleet
Taxing
Taxing an IRP fleet and the items you use in business
Off-Highway Vehicles
Basics Guide
Dealer Sales
Sales of off-highway vehicles by dealers and retailers
Dealer Leases
Leases and rentals of off-highway vehicles by dealers and retailers
Private Party Sales
Sales of off-highway vehicles by private parties
Private Party Rentals
Leasing out or renting out your own off-highway vehicle
Donating
Donating or giving away an off-highway vehicle
Transportation
This guide explains how Idaho sales and use tax laws apply to the transportation industry. It includes how Idaho taxes apply to sales and purchases that transportation companies make. This guide also covers exemptions, requirements for keeping records for sales and use taxes, and filing returns.
Motor Vehicles
For motor vehicle dealers and private party sales
Off-Highway Vehicles
For snowmobiles, ATVs, UTVs, SOHVs, and motorbikes
Watercraft
For boats, trailers, and other watercraft
Aircraft
For aircraft registration and taxes
Ground, Air, Rail
For ground, air, and railroad businesses
IRP
For vehicles registered under the International Registration Plan (IRP)