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Tax Time? Loan Interest Deduction - IRS

Michael TMichael T Member Posts: 7,227 ✭✭✭✭✭
in Rinker Express Cruisers Forum
I brought this up on another thread and thought maybe I should raise it here too. Now that tax time is near just a friendly reminder for guys who own cruisers. If you have a fixed head, cooking, capability and sleeping capability you can deduct the interest on a loan to finance it. There may be more details but it is a great advantage. Steve (Handymans 342) confirmed this and mentioned his wife is a tax accountant.  I believe he said he might post the IRS rule number? Anyway, I can't (boo hoo) as my government is too cheap but to any of you who can - lucky you!
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    Black_DiamondBlack_Diamond Member Posts: 5,439 ✭✭✭✭✭
    True. As long as you itemize. 

    Past owner of a 2003 342FV
    PC BYC, Holland, MI
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    craigswardmtbcraigswardmtb Member Posts: 1,015 ✭✭✭
    I posted in the other thread as well but keep in mind it is essentially being classified as a second home. So if you have a second home and you deduct it's interest than you could not also deduct the boat loans interest.

    I have a bad feeling an audit is coming my way this year.  Between homes, investments, new line of credit, a new w2, and a solar credit I'm getting close to 30k back. I'm pretty sure they don't like cutting those checks....
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    HamdogHamdog Member Posts: 247 ✭✭
    My boat is on a home equity line of credit so is already deductible.
    "Wetted" Bliss 2005 Rinker 342 - Black Hull - Twin Mercruiser 350 Mags - BIII's
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    andydandyd Member Posts: 849 ✭✭✭
    I deduct my boating expenses under "gambling losses" :D
    Andy
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    mattiemattie Member Posts: 1,254 ✭✭✭✭
    We can do something similar up here in Canada. Use a portion of our boat expenses as 'entertainment' for clients under business deductions.

    That said, I don't bother....it's an extra layer of complexity on the tax return. Could easily be disputed.

    Also, as a 2nd home - interest rates are so low now, the annual interest expense may not justify the increased scrutiny.

    my 2 cents.
    246BR, 276BR, H310BR current
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    mattiemattie Member Posts: 1,254 ✭✭✭✭
    Looks like Hamdog has the simplest solution above.
    246BR, 276BR, H310BR current
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    JoeStangJoeStang Member Posts: 1,116 ✭✭✭✭
    Yeah I get to deduct the interest on the loan, even for my little 276 since it has a sink, toilet, and sleeping area. It doesnt make a HUGE difference though, since I got a very good rate and its a 15 year loan. I think it was like $3-400 more than without that deduction.
    2013 276 Cuddy ~ 350 MAG / B3
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    craigswardmtbcraigswardmtb Member Posts: 1,015 ✭✭✭
    mattie said:
    Looks like Hamdog has the simplest solution above.
    Yes but keep in mind if you default you now collateralized with your house. Some aren't comfortable with that. 
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    randy56randy56 Member Posts: 4,083 ✭✭✭✭✭
    Never had a boat pmt. and probley will never have 310,342,360, well maybe.
    Boat Name : 

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    craigswardmtbcraigswardmtb Member Posts: 1,015 ✭✭✭
    randy56 said:
    Never had a boat pmt. and probley will never have 310,342,360, well maybe.
    Head up to Canada with a wad of Benjamin's and I bet you could find a nice 360 for 70k usd or so. 
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    Michael TMichael T Member Posts: 7,227 ✭✭✭✭✭
    edited March 2016

    Too funny, maybe a 360 sea ray!

    Post edited by Michael T on
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    chamberbchamberb Member Posts: 265 ✭✭✭
    Thanks for the tip MT!!
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