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Old 01-06-2018, 02:33 PM   #1
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Interest deduction on RV loans

I just received the latest addition of RV Life. According to them, under the new tax plan they changed the definition of RV limiting it to motorized ones only for purposes of deducting the interest of a loan. This is a pretty significant kick in the pants for those of us with towable on which we are paying. According to the article, the RVIA is working with the Senate and House to change the definition. Man, if this is the case, I hope they do.

Jim
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Old 01-06-2018, 04:53 PM   #2
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Who knows if the below 'technical corrections' process will include a revised definition -

RVIA says it will work with the House Ways and Means Committee and the Senate Finance Committee to include a change to the definition in a technical corrections bill which will likely be needed next year as other oversights and unintended consequences become known.

But, for now, if buying a towable RV is in your plans, don’t count on taking a tax deduction on the loan interest. If you already own a towable RV and have been deducting the interest, contact your tax professional to learn how this applies to you.
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Old 01-07-2018, 12:08 PM   #3
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There was an earlier thread on this. As I understand it, this is for deductions on RVs as "second homes". Guys...you can certainly afford this and don't need government help. jmho
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Old 01-07-2018, 01:15 PM   #4
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Even if it was eliminated, the standard deduction was doubled so unless you had over 24k in deductions, you will still come out ahead. Chances are if you have over 24k you will still come out better with lower rates. If you are used to a multiple page return, with the increased standard deduction, you most likely will have a 1 page return.

These numbers are for married filing jointly.
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Old 01-07-2018, 04:30 PM   #5
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New tax law

Not sure if this forum is the place to discuss the new tax law, but since someone started it... Thanks for the head's up on the '2nd home' loan towable class interest deductibility change. Guess 'we'll have to read the law to find out what's in it'... I also 'heard' the interest on home equity loans may have lost deductibility. The increase in the standard deduction may cover some of these losses, but no one is talking about the doing away with the exemption deduction for each dependent being lost. That loss will quickly eat up any gain in standard deduction... Think we've been hook-winked fellow campers...
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Old 01-07-2018, 04:43 PM   #6
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Quote:
Originally Posted by Gypsea View Post
Not sure if this forum is the place to discuss the new tax law, but since someone started it... Thanks for the head's up on the '2nd home' loan towable class interest deductibility change. Guess 'we'll have to read the law to find out what's in it'... I also 'heard' the interest on home equity loans may have lost deductibility. The increase in the standard deduction may cover some of these losses, but no one is talking about the doing away with the exemption deduction for each dependent being lost. That loss will quickly eat up any gain in standard deduction... Think we've been hook-winked fellow campers...
I've been following the developments fairly closely due to my business (obviously I don't think anyone has a handle on all of this yet) and it appears that the break even point on the deductions will be at 3 children/dependants. 3 or less, the new standard deduction will be favorable. 3 or more would have been better under the old model (not considering the standard rate decrease across the board). Of other interest to me is that it appears that the earned income tax credit will be in play for many more since the threshold will be raised from 110K to 400K for married filing jointly.

Again, there is a lot to learn about this and I'm sure that we will all have a much better picture of this in the next few months.
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Old 01-09-2018, 02:09 PM   #7
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Midnightmoon. Your assessment of the tax bill's effect of losing the personal exemption for dependents is only applicable if you're using the standard deduction now and in the future. In that case the change is neutral with 3 exemptions and reduces taxes (all other things being equal) for less than 3. But in the case a person itemizes deductions due to high taxes, interest, medical, and / or donations, then the benefit is not there. Example $20k itemized vs new standard deduction would be neutral for only one personal exemption. The new tax rates will of course determine the final tax bill. We'll have to wait and see. I pity the folks with large families, except they get the child credit for younger ones. Don't think folks are aware of this change. Now back to RVing subjects...
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Old 01-09-2018, 02:40 PM   #8
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So how is that a tax cut if they take away more then they give with dependents? Sounds like a shell game to me, not a tax cut. I was pleased to hear about them doubling the standard deduction until now.
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Old 01-09-2018, 02:49 PM   #9
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In regards to mtdawg's original post on this thread, the new tax law eliminating the deductibility of loan interest on towable RVs vs powered ones, makes about as much sense as eliminating it on sailboats vs powerboats. The qualification has been based on having sleeping quarters, bathroom & cooking facilities, ie: self-contained, like a second home. Gotta love those 'well-meaning' legislators...
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Old 01-09-2018, 08:30 PM   #10
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Interesting...I visited the San Antonio RV show this past weekend and I spoke to several "reps" about the new Tax law (typical water cooler conversation).

The consciences was that any RV/TT were the bathroom, bedroom, and living area were separate was eligible for the interest dedication.

Don't quote me on it but there were 2 signs (two different dealers) who posted a sign that the interest was still deductible for 2018.

Don't kill the messenger...I'm just telling you what I saw and heard .
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