Tax Laws for Motor Homes

Buying a motor home doesn't just give you the freedom to go wherever you want whenever you want. It also potentially lets you write off a portion of the cost of that travel. Whether or not your motor home is a second home, the Internal Revenue Service's tax rules give you multiple potential write-offs. To take advantage of them, you need to itemize your deductions.

Sales Tax Deduction

As of July 2013, the sales tax deduction is in effect for the 2012 and 2013 tax years, though it is scheduled to expire after 2013 unless Congress acts to extend it. If you live in a state with a sales tax and you buy a recreational vehicle, you can choose to deduct the state sales taxes you pay in that year instead of deducting your state income taxes. Stacking other high-cost purchases along with your RV could net you a healthy tax deduction. This strategy is especially valuable in states with no state income tax.

Personal Property Tax Deduction

While you don't pay the same kind of property taxes on an RV that you would pay on a house, if your state charges you a personal property tax, it might be deductible. The IRS allows you to write off the cost of personal property taxes that are charged yearly and tied to the value of the asset being taxed. If you can write off a portion of your car's registration, you can probably do the same with your RV.

Mortgage Interest Deduction

Most RVs qualify as second houses. If your RV has a toilet, a place to cook and a place to sleep, it's your home. This means that you can claim the same home mortgage interest deduction that you claim on your house. The interest on your first $1 million in purchase debt on your first two houses and on an additional $100,000 of home equity debt taken out for any purpose is deductible. To write off the loan on your motor home, it needs to be secured by the motor home. If you bought it on your credit card, it wouldn't be deductible, but if you took out an RV loan, it would be.

Home Offices

Since your RV qualifies as a home, you get the same right to deduct a home office that you would in a fixed house. Bear in mind, though, that the IRS still requires you to use the home office exclusively and regularly. Given that space is limited in some RVs, designating a dedicated area could be challenging.

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About the Author

Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.

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