Property owners take title to both the surface of the land they own, and in most cases, the subsurface areas underneath the defined property lines. Unless a covenent or other recorded document legally gives title or rights to another party, the landowner generally enjoys ownership over minerals, water, oil, coal, and other natural resources that may exist subsurface. Eminent domain proceedings can seek to acquire title to the subsurface rights of a landowner as well as the surface rights. This can occur when subways or water pipes are built or extended through areas in which they previously did not exist. To the extent a property owner enjoys the mineral and subsurface rights, they must be compensated for the taking, damaging, acquisition, or interference with those rights by a government entity.
Common tax questions as applied to boats
The concept of the possessory interest tax is not new in California. Indeed, the Golden State is widely recognized among legal observers as having the longest history in levying such obligations. Despite that record, many questions can linger. These may include, but are not limited to:
- Who is the taxing authority?
- If a boat slip is vacant, is it subject to taxation?
- If you have possession of a mooring spot, but not a slip, can you be taxed?
- Can marina operators add the tax to your fee if it isn't specified in the lease?
Here are some answers
If a public entity owns a marina and you rent a slip there, the law says you have a possessory interest in the slip and the water under it. As such, you can be taxed.
State law requires assessors to value possessory interest for taxation and the obligation for the tax can pass through to a renter by a marina. It does not matter if the property is owned privately or publicly. The job of levying the tax rests at the county level
When it comes to informing users about potential taxes, though, there can be inconsistencies. Some marina operators may include the assessment in the slip fee. Others might stay out of that fray, but if the assessor shows up, the slip holder can be held liable for the tax.
Ultimately, where government valuations are involved, there is a certain level of financial risk and liability to individuals. To navigate the complexities, it helps to consult an experienced attorney.