Tax Deductions For RV Owners

tax-time-by-garyfgarcia.jpg Before we know it, our least favorite time of year will be coming around again:  April 15th, the deadline to file your taxes.  

There’s nothing wrong with paying taxes; our country is one of the best places in the world to live thanks to what our taxes do for us.  On the other hand, there’s no reason to give Uncle Sam any more money then he’s entitled to.

The purchase of an RV is a large investment for most families.  One thing that may help soften the blow to your budget is that, in many instances, your recreational vehicle purchase will be partially offset by some very helpful tax deductions that are completely legal and fully supported by the IRS. 

Yes, even Uncle Sam tries to help when he can.

The RV As A Second Home

Most RV owners bought their rig with an RV loan provided by some sort of financial institution.  In turn, they are charged interest.  In most cases, interest paid on a loan is not an acceptable deduction.  Most loans — for example car loans, credit cards, or unsecured loans — don’t meet the requirements necessary for them to be deducted. 

The only loan interest payments that are acceptable deductions today are home mortgage interest payments.  Your mortgage holder will supply you with the needed information to determine what portion of your monthly payment went toward the finance charge, or interest portion of the loan.   Now this is where your RV comes into the picture.

Owners of "second homes" may also deduct the interest portion of their payment on that dwelling as well.  And yes, your RV qualifies as a second home. 


Legitimate Tax Deductions For RV Owners

There are a few basic requirements that must be met to claim your RV as a second home. For example, it must have on-board permanently mounted sleeping, eating, and bathroom facilities.  The point being: throwing a bed roll into your van doesn’t make it a motorhome.

hooking-up-airstream-trailer-by-Koocheekoo.jpg A loan on your travel trailer or fifth wheel does qualify for the interest deduction, while unfortunately the loan on the truck used to tow it doesn’t.  Apparently, the government doesn’t see the point in moving your second home to new locations.

A portion of your RV’s vehicle registration can be another tax savings.  In some states that don’t have personal property taxes, the annual vehicle registration contains both a portion based on the weight of the vehicle and a portion based on the value.  The portion that relates to the value is a tax deductible expense. 

You may even be able to deduct a portion of the sales tax you paid on that new motorhome or RV trailer you purchased during the past year, too.  There’s a worksheet on your tax form that will determine how much you’re allowed to deduct.  This is a one-time deduction, but with the sizable investment of an RV, sales tax is a large piece of your purchase price.  Getting some of that back in the spring will be helpful for sure.

The IRS 1040 Worksheet (.pdf) shows you the various tax deductions that are allowed on your income tax concerning RVs.

If you happen to be a business owner (even if yours is a small home-operated business), and your business requires you to travel or work out of your RV on a regular basis, then you can move into another whole world of tax deductions known as business expenses

rv-computer-workstation-by-Lance-and-Erin.jpg There is no better way to save money on your taxes than to be in business for yourself.   Any expenses related to operating your business come right off the top, reducing your net taxable income by the total amount of the expense.  If your RV is primarily used to entertain and build relationships with other businesses, or is used to transport your company’s staff from one job location to another, you may find at least some (and possibly most) of the cost of owning your RV will be classified as a business expense.  Of course, any percentage of its use that is personal in nature wouldn’t be an allowable deduction. 

You should consult with your personal accountant or a tax specialist to find out exactly how you can make your RV work for you.  You may find it surprising how many hobbies can be turned into profitable businesses — all wrapped around the RV lifestyle!


More Tax Deductions For RVers

Curtis Carper

Curtis Carper

I’ve been involved in RVing for over 40 yrs -- including camping, building, repairing, and even selling RVs. I’ve owned, used, and repaired almost every class and style of RV ever made. I do all of my own repair work. My other interests include cooking at home, living with an aging dog, and dealing with diabetic issues. If you can combine a grease monkey with a computer geek, throw in a touch of information nut and organization freak, combined with a little bit of storyteller, you've got a good idea of who I am.

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  • Roy Dutcher

    I am looking into an RV for a second home or possibly full time home. I do training all over the country. I typically let my S corp. pay for my lodging because as a closely held corporation the IRS will not let me use the standard per diem for lodging. If I use the RV at my training locations for my lodging, how can I have the corporation pay me for it?

    • curtis carper

      Roy, I recommend you contact a tax specialist. I am NOT such a person.I know your RV can be considered a permanent home, and as such you can include a home office deduction, but I don’t know about the whole package being deducted.a tax specialist could better answer your question.