Back
to top
Governor Phil Murphy • Lt. Governor Tahesha Way

Division of Taxation

Casual Sales

The Casual Sales Unit works with the New Jersey Motor Vehicle Commission and other agencies to verify and collect Sales Tax on purchases of motor vehicles, boats, and aircraft. We examine purchases made by residents and non-residents and send notices when we find discrepancies between the amount of Sales Tax due and paid. You must respond in writing if you receive a notice from us.

The purchase of boats and vessels is subject to New Jersey Sales Tax under the New Jersey Sales and Use Tax Act. This act imposes a tax of half the applicable Sales Tax rate, up to a maximum of $20,000, upon the receipts from every retail sale of boats and vessels in New Jersey. (P.L. 2015, c. 170)

The following apply to vessel transactions and use in this state under N.J.S.A. 54:32B-2, N.J.S.A. 54:32B-8.6, and N.J.S.A. 54:32B-10 of the Sales & Use Tax Act.

  • Vessels acquired from a dealer in New Jersey are subject to Sales & Use Tax.
  • Vessel acquired by a resident of this state, including documented vessels, from a dealer outside the State of New Jersey are subject to Use Tax at the time of first use in this state.
  • Vessels acquired in a casual or non-dealer sale transaction that are subject to registration in New Jersey are subject to Sales & Use Tax.
  • Any vessel not meeting the requirements of the "Head Boat" exemption as defined by N.J.S.A. 54:32B-8.12 is not exempt from the Sales & Use Tax Act.

For additional information on exemptions and the taxability of boats/vessels in New Jersey, contact the Galloway Regional Information Center 609-415-6420 or the Casual Sales Section Taxation.CasualSales@treas.nj.gov

P.L. 2015, c. 170 amends the Sales and Use Tax Act to provide a 50 percent Sales and Use Tax exemption on the sale of new and used boats or other vessels (including motorboats, sailboats, yachts, and cruisers) and caps the amount of Sales and Use Tax so that the most that the State can collect on a particular sale is $20,000. As a result, the Sales and Use Tax rate goes to half of the applicable rate. There is no further reduction of the Sales and Use Tax rate on sales in an Urban Enterprise Zone or in Salem County. The exemption and cap apply to purchases occurring on and after February 1, 2016. Because rental/lease transactions are treated as retail sales under the Sales and Use Tax Act, these changes also apply to rentals and leases of boats or other vessels.

In addition to the exemption and cap, for uses on or after January 1, 2016, the law allows a grace period for certain boats or other vessels purchased out of State by a New Jersey resident to be used in New Jersey for up to 30 days in a calendar year without triggering use tax so long as:

  1. the boat or other vessel is legally operated by the resident purchaser and meets all current requirements pursuant to applicable federal law or pursuant to a federally-approved numbering system for boats and vessels adopted by another state; and
  2. the resident purchaser is not engaged in or carrying on in this State any employment, trade, business, or profession in which the boat or vessel will be used in this State.

The Division is currently drafting regulations. Information regarding the administration of the new law will be posted to this website as it becomes available.

Email: taxation.casualsales@treas.nj.gov

Mail

  • State of New Jersey
    Division of Taxation
    PO Box 267
    Trenton, NJ 08695-0267

Motor Vehicles FAQs

Boats and Other Vessels FAQs

Aircraft Purchases FAQs

Last Updated: Tuesday, 09/09/25