It’s tax time, yet again. Accountants across the country are probably getting asked a similar question, “can I deduct any RV expenses if I use it for business.” While the answer might be “yes,” be aware that you’re venturing into a delicate area of the tax law having to deal with entertainment facilities.
An entertainment facility is any property you own, rent or use for entertainment. Internal Revenue Service examples of an entertainment facility include a yacht, airplane and, although not specifically enumerated, it would also probably include a recreational vehicle. Generally, you cannot deduct any costs relating to the use of an entertainment facility, such as depreciation, maintenance and insurance. While it’s true that a corporate jet can be considered a legitimate expense, it’s because the expense is considered ordinary and necessary in a particular line of business.
Your line of business would be key in determining the legitimacy of the deduction just as it would be for a corporate jet. For example, if you’re a physician or veterinarian and you use the RV as an office to meet with rural patients, then you can probably claim the full amount of the RV as a business deduction. If you could travel around to your clients without the need of a motor home and you have another office available to you, then the deduction is probably not an ordinary and necessary part of your business.
If the RV deduction is considered ordinary and necessary, then the interest would be a business deduction and not a second-home mortgage interest deduction. If the motor home is not a business deduction, you could still claim the interest as second-home mortgage interest. We suggest you get advice from your accountant on how you can reasonably justify the expense of the motor home in your line of business.
About Motor Home Finders, is a licensed motor home broker based in Dade City, Florida. Specializing in diesel, luxury motor homes and bus conversions, Motor Home Finders has 50+ years of experience in buying and selling luxury RVs nationwide. Their mission is to eliminate the difficult efforts of private sellers trying to sell their recreational vehicle by orchestrating a seamless RV transaction process. To learn more, call 1-888-783-4009 or visit Motor homeFinders.com.