It is normaly required by lenders of larger boats in many states since state boat title laws are different state to state and in some cases nonexistant. My state drastically discounts the annual tax stamp for documented boats. I know of very few tax savings available on either sales or personal property tax. I have heard of some vessels purchased by people who will document them to a state that has no sales tax but this can be difficult and all state, local and federal taxing authorities hate the old shell game. My boat is documented only because the purchase price was in the hundreds of thousands and I wanted to borrow a portion of the money. I don't remember the exact length but a boat needs to be around 32' LOA before it can be documented.