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Question:

Do you indent after every line of dialog?

gt;“Everybody get in and ill hoist the sail up.” Peter offered. Once we all hopped in we were on our way to Seguretat. The sound of the wind in the sail and the water filled my ears. Dawn was just breaking, the sky was painted a light pink. gt;“What are we going to do once we reach it?” Peter asked with his eyebrows raised gt;“We are going to find my mother.” I replied after a long pause. gt;“She always told me about it she said ‘Its never far away from home you just have to find it.’ I never thought it was this close. She told me it was always safe its called Seguretat, which mean safety in Catalan. ^ Is this correct? Each gt; means indention

Answer:

You only need 2 paragraphs here. You have Peter talking. Then it changes to you talking. Each speaker gets new paragraphs, but the dialog within a paragraph can be interrupted by description.
Lauren, every new speaker's dialogue is indented. The moment someone else reacts, by answering, by moving, by thinking, you need a new paragraph. Be aware this contains lots of mistakes in dialogue and other punctuation. I'll do a fast once-over for you. “Everybody get in, and I'll hoist the sail,.” Peter offered. Once we all hopped in we were on our way to Seguretat. The sound of the wind in the sail and the water filled my ears. Dawn was just breaking, the sky was painted a light pink. “What are we going to do once we reach it?” Peter asked with his eyebrows raised “We are going to find my mother,” I replied after a long pause. She always told me about it. She said ‘It's never far away from home. You just have to find it.’ I never thought it was this close. She told me it was always safe. It's called Seguretat, which mean safety in Catalan.

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