The Tax-Deductible Lifestyle Of Self-Employed RVers

by Curtis

Fulltime RVing, Taxes, Work And Money

computer-on-rv-by-Lance-and-Erin.jpg RVing, whether as a full time lifestyle or as a weekend or vacation activity, can actually save you money under the right circumstances. 

Uncle Sam, the tax man, gets a pretty good chunk of your paycheck every week.  Maybe as a retired RVer you’re finding it harder and harder to manage the cost of fuel to travel as much as you had planned during your golden years.

You have options… ways to travel at a reduced cost to you and have an opportunity to actually make money out of the deal.

Are You Self-Employed?

The best way to come out ahead when dealing with taxes is to be self-employed. 

Now don’t get in a panic; this doesn’t have to mean investing a huge amount of money in the hopes that your own personal “widget” will sell like hot cakes as you travel from town to town.

Being self-employed doesn’t have to include heavy financial risk. More importantly, it doesn’t even have to be a “full time” effort.  It can be as simple as expanding on a current hobby to the point that you can create a second income — on top of whatever job or retirement you already have in place.

As a benefit, you may be able to deduct some of the expenses associated with RVing, as job-related expenses.  This is especially beneficial because your expenses come right off the top of your gross income, not a percentage as is the case with many of the 1040 itemized deductions you normally deduct on your taxes.


What You Can Deduct

rv-flea-market-by-HCreedplayer.jpg As an example, if you go into the flea market business and pull a modest cargo trailer behind your motorhome, you can deduct some of your expenses. 

Say you set up tables and work organized flea markets on a schedule of once a month… during the period you’re actively pursuing your side business, you can deduct mileage driving to and from the flea market, any mileage incurred while obtaining inventory, as well as any campground fees or overall any expense incurred during your trip that relates to the selling of merchandise at the flea market. 

Also, the cost of the trailer and any other related equipment like tables and canopies are considered business expenses.

If you and your spouse go out for dinner to discuss your plans for upcoming sales or travel issues relating to your business, that meal becomes a business meeting and is also tax deductible.  If you take the flea market manager out for drinks… you guessed it, deductible.

You can see where this is heading.  Many of the expenses you would incur during a normal RVing weekend outing now become part of your side business.  When deducted, they reduce your profit and lower your tax liability.  Your nifty little side business has started to pay for part of your hobby.

Business plans can cover a whole spectrum of ideas.  Things like making jewelry, selling secondhand clothing, books, crafts and novelties, even becoming a traveling journalist will allow you to create a part-time side income that will be very helpful in stretching your main source of income in today’s economy.


Is Yours A Full-Time Business On Wheels?

rv-job-work-onboard-by-mahalie.jpg Of course, you could be totally self-employed on the road as well. 

Then, it might be to your benefit to depreciate the cost of your rolling estate over a period of time, and deduct the actual cost of travel rather than mileage.  Depending on how many miles per year you travel, the IRS will decide for you which way they will allow.

Uncle Sam doesn’t want any more of your money than he is due.  In fact, any efforts to be partly or totally self-employed are looked upon favorably by the government.  This means there are many ways that you, as a taxpayer, can greatly reduce your tax liability by getting into any kind of a small business.

Uncle Sam even gives you the opportunity to fail without penalty.  You have 5 years to make a profit before he will question your tactics. 

Being self-employed in any way, shape, or form can only help you.  Be sure to consult an accountant or tax specialist to make sure that you clearly understand your responsibilities and tax liabilities when starting a business.  Then, go out there and just do it.  Who knows?  You might become the next millionaire on the road!