RV Finance: Stimulus Plan Includes Tax Deduction for Motor Home Purchases
**The following post is not intended and should not be interpreted as giving specific financial advice.**
On Tuesday, Feb. 17, President Obama signed the American Recovery and Reinvestment Act into law. If you are thinking about buying a new RV or motor home, you should pay attention. Part of this legislation includes a tax deduction for any state or local sales or excise tax imposed on the purchase of a qualified motor vehicle between Feb. 17, 2009 and Dec. 31, 2009.
For this Act, the term ‘qualified motor vehicle’ includes “a motor home the original use of which commences with the taxpayer.” See item III of part D on page 204 of the PDF file for further information.
Download the PDF to read the exact, final text of the bill to see for yourself if you qualify for this vehicle sales tax deduction. See pages 203-4 of the PDF file, starting with “SEC. 1008″. To download it yourself straight from the source, go to the White House Press Office web page and click on the final text link.
For specific tax questions, consult a certified accounting firm in your area. They can review your financial situation and give you advice about which actions to take that would benefit you.
The federal government has a dedicated website that the public can visit to learn more about the Act, its enactment and to share feedback about how the Act is affecting their lives. You can also visit the White House website to find out the latest news from the Executive Office and submit your comments, thoughts and ideas about the current state of affairs.
If you’re interested in buying a new RV, visit Trailer Life’s Free Online RV Buyers Guide for tips and resources or to browse RV classified listings.
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Your headline is very mislesding. There is a world of diiference between a “credit ” and a “deduction? when speaking of taxes.
John, you are quite right. Thank you for pointing out the inconsistency. The new law is in fact a tax deduction, not a tax credit. The article has been corrected to avoid any further confusion.
Thanks again for bringing it to our attention!
what are we going to get ,and how much is it going to be.i would like to buy a class a or c motor home .how much tax am i going to save.i live in delaware
Although any effort is better that than none, the tax deduction should have by all means been retroactive to when the initial downfall began. Such a slap in the face to the buyer that downsized his life in January, 2009 in an effort to cope with the situation. Even like Myself in September of 2008 I put out $43,000.00 and paid the sales tax, in California of all places, and is Obama telling Me that I wasn’t aware of the downfall etc. The governments problem, which is very basic, is that they never go “quite” far enough to actually “fix” a problem. Proof is in Iraq, Vietnam. Just go make a lot of noise and smoke, and hope everyone accept’s it as honest effort to finalize and fix something, instead of actually “fixing” something in it’s entirety. But then why would I expect anything different out of a government that that is losing it’s grip.
Please, don’t come back at Me with the additude that i am having a bad day or am anti government, or unappreciative of their efforts, or don’t “understand” how it all works. I know how it works, and I know how it “don’t” work. And always being Mr Nice Guy, “don’t work”. Im sorry, go ask “Mr Madoff” for His opinion and a explanation. They govt is giving Him more “breaks” for what He did, than they are even coming close to doing for You or I, for what We did, and didn’t do.
Well, maybe We should all be good little subjects, and proudly sit around and wait for the next ax to drop, How about, “Sorry folks, but today I must announce that We Are All going to have to give, some more, and I am announcing that i am shutting down the Social Security payments to Ya All, effective immediately”
Don’t think for a minute that it is out of the question. Do the math.
PS. To Thomas Glenn, I would suggest that You aren’t going to save very much, although You will save some. Just take the sales tax off of Your purchase and see how much it drops your projected “taxable income” for this year and You will have a pretty good idea. Also consider how much You will save on the actual purchase price of the motor home You are considering, remembering that it is a buyers market right now. How much effort You put into Your purchase “research” will tell you how much You will save on that as well. Add the two for a total savings etc. Remembering all the while that to itimize Your deductins, or to ‘benefit” from them, You have to meet a minimum amount of deductions, and most people can’t/don’t/or won’t, be able to comply to that amount, and therefor won’t be “able to get” the deduction in the end, and therein lies the smoke and the noise. But it looks and sound’s great, don’t it though !!!! Check it out.
The deduction will be the sales tax on the first 49,500 purchase price of the vehicle. THIS MUST BE A PURCHASE OF A NEW VEHICLE, used ones don’t count. If you have been itemizing and living in a state without a state income tax, you have been able (for the last three years and next year) to deduct the sales tax on any large purchase including an RV (it didn’t have to be a motorhome as the new deduction requires) and it wasn’t necessary that it be new and there were not any limits on the amount.
This new deduction will be what we call “above the line” and not require itemizing in order to get it. Those who do itemize and live in a state WITH a state sales tax will get to deduct both, not either as has been in the past, again withn the limits stated at the beginning of this post.
I heard that it might be retro active. I think that people should consult their accountants to help them determine exactly what the credit means for them. I think the benefit of the credit is that if you were on the fence about buying a new RV in 2009, this might be the push that helps you go over.
I wish it was a more up front help – like down payment assistance or something (just like I wish the home buyers credit was) but I think this is something. It’s one of the things in the stimulus plan that actually helps middle class Americans. That’s good, right?
I purchased my new RV on January 23 2009. Do you think there is any chance they might back the qualifying date up to maybe the first of the year.
[...] on next year’s tax return. According to a breaking news article March 18, 2009, in RV Business, “the combination of the sales tax deduction as well as interest deductions on RVs – because [...]