Could Uncle Sam Help Pay For Your RV?
Tax time – is it a time that you dread or a second Christmas for your family? For some, the hefty tax bill that comes due makes tax time the worst time of the year, but for others, the return can make it wonderful. Did you buy an RV last year, or are you considering buying one this year? Well, it is possible that Uncle Sam will make the dream of owning an RV come true. Here, you will learn about tax deductions that you could qualify for when purchasing or owning an RV.
Sales Tax Deduction
The sales tax on an RV can quickly add up to a substantial amount of money. How nice would it be to get some of that money back? Well, the IRS permits the deduction of sales tax on motor vehicles. Their definition of motor vehicles includes automobiles, motorcycles, motor homes, recreational vehicles, sport utility vehicle, van, or truck.
Is your RV used as a second home for your family? If so, you may be able to deduct a portion of the interest that you pay on the RV loan on your taxes. In order for your RV loan interest to be a legitimate deduction, the RV must contain every element needed to live in the RV on a semi-full-time basis. This means that you must have a bathroom, a bed, and cooking and dining facilities on board.
Note: If you own a fifth wheel trailer or other trailer that must be moved using a separate vehicle, the interest that you pay on the vehicle loan is not deductible.
The registration fees that you pay each year are tax deductible. This is usually not a huge savings, but when it comes down to it, every penny counts.
Do you use your RV for business purposes? Maybe you use it to travel to drum up new clients or to get to business meetings. If you regularly use your RV for business purposes, you can even deduct the cost of operating the RV during that time. Business expenses are tax deductible, so keep careful records of your business expenses this year.
Note: If the RV is used for personal trips, you will not be able to deduct those expenses on your taxes. Be sure to chart the mileage for the travels so you can deduct it from the year's business uses.
For the best results, contact a tax professional, such as Tri Check Inc, to discuss using your RV as a way to increase your tax return this year. You may be surprised at the decrease in your tax bill or the increase in your return when using the available RV deductions.