Taxes definitely qualify as one of the least-fun things to think about in the world. Even if you’re getting a return, who wants to deal with all the paperwork? And for those of us lucky enough to be independent contractors (cough, yours truly), tax time means writing a check rather than receiving one.
RVing, on the other hand, is one of my favorite topics for daydreaming. Just the mention of RV camping calls to mind all the exciting destinations waiting to be discovered, a bucket list of new sights, sounds, and experiences.
So what’s in the middle of this unlikely Venn diagram?
Well, as it turns out, you might just qualify for some tax deductions on your RV if you own your own rig. And as not-fun as taxes are, the inarguable best part about all that paperwork is figuring out where and how to save some money.
Don’t get me wrong; it’s fine for Uncle Sam to get his fair share. It’s pretty convenient having that public road system in place when you’re trying to get around in your camper, after all!
But at the same time, any kind of relief is always welcome at tax time. What can I say? Math was just never my subject.
So let’s find out how we can save some money this year, shall we?
Here’s what you need to know about tax deductions you may qualify for on your RV.
Tax Deductions for RV Owners
If you’re like most RV owners, you probably financed your vehicle with a loan. After all, even “inexpensive” RVs easily cost in the tens of thousands of dollars — not exactly a minor investment!
Most loans — whether discretionary, credit, or auto — don’t qualify for any sort of tax deduction. After all, you can ostensibly live without charging something to your credit card, and you can even do without a car.
Of course, in real life, making those sacrifices isn’t always possible. And not being deductible makes those loans into an even bigger headache, especially when you factor in depreciation. It’s easy to get sucked into debt when you’re shelling out interest for an asset that’s losing value by the minute.
But everyone needs a roof over their head, and Uncle Sam seems to sympathize. That’s why home mortgage interest is a qualified deduction on your taxes.
That leads us to the fun (well, sort of) part. Your RV probably qualifies as a second home (or your first, if you’re full-timing), which makes it eligible for this interest tax deduction.
RV Tax Deductions Guide
To qualify for the interest tax deduction, your motorhome does have to meet certain requirements. That’s so people don’t try to find a loophole and call a clearly unlivable dwelling a home.
But chances are, if your RV isn’t custom-made and pretty strange at that, you’re in the clear. Here’s the official legal mumbo-jumbo:
“For you to take a home mortgage interest deduction, your debt must be secured by a qualified
home. This means your main home or your second home. A home includes a house, condominium,
cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities.”
Basically, if your camper is a place you’d actually be able to live for more than a night or two, it likely qualifies. However, the tow vehicle you use to haul a fifth wheel or other travel trailer does not benefit from this tax deduction.
Furthermore, your RV might also be eligible for a sales tax deduction, along with the sales tax assessed on other major purchases like cars, aircrafts, boats, or building materials for major home improvements. This tax deduction could benefit you even if you paid for your rig in cash and don’t pay interest on a loan.
Keep in mind, however, that if you purchased your RV in one of the five states that don’t assess sales tax, you wouldn’t qualify. Here are those states, just for a quick refresher:
- New Hampshire
RV as Second Home
Even if you don’t live in your RV for more than a few days out of the year, it may still qualify for the deduction mentioned above as long as it fits all the indicated requirements. And if you’re living full time in your RV as a residency, it definitely qualifies for a primary home tax deduction. Great news, right?
Now, if you’ve ever used your RV for any sort of business purposes — say, for example, renting it out on RVshare 😉 — you may also qualify for an additional tax deduction under business use. You’d need to provide proof and documentation of all the income you generated with the RV, and, if living in it was part of your business model, you’d need to have a log of all the nights you spent in it and all the miles you drove it. According to Roberg Tax Solutions, over 50% of the nights you spent on board would have to be for business purposes, and you wouldn’t be able to stay in the rig for more than 30 days at a time, so as to ensure it still qualifies as a transient residence.
These laws are a little bit more convoluted, so we’d recommend checking with your accountant about whether or not you can document your RV as a business item in your paperwork, and if so, how to do it.
RV Tax Write Off
You may still be wondering, “Can I really write off my RV? How do I even get started?”
We’re not financial experts here, so if you have any questions, we’d recommend speaking to a tax specialist or your personal accountant. RV taxes and their laws and deductions can vary by state and circumstance, and we wouldn’t want to steer you in the wrong direction!
But even if you only score a small write-off — or even if you don’t qualify at all — it’s nice to know that, once in a while, there’s a silver lining at tax time.