Tax Corner: Downsizing to become full-time RVers

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By Neil Seidler, CPA, CMA

Happy New Year, Readers.

Today I’m going to talk a little about becoming a full-time RVer – specifically about packing up and selling your home to become full-time RVers. Although we’ve been what I call part-time full-timers for quite a while, we finally decided to sell our sticks-and-bricks home. It’s been a long few months of having garage sales to sell off the things we don’t want to keep, packing up the things that we do want to keep that will go into storage, and deciding what things are in each category. My insight and advice to anyone beginning the process is as follows.

1. The process will take longer than you first think it will.  When we went back to Texas to pack up the house, we thought a couple of garage sales, a bunch of plastic storage bins, and two or three weeks was all it would take. Boy, were we off. The process took us more than two months of going at it every day from early morning to well into the evening – they were long days.

2. Deciding what to keep and put into storage and what to dispose of will be harder than you think. We had 30 years’ worth of “stuff” to deal with, most of which we still had because it had memories attached to it. Deciding to part with some of it was difficult. On top of that, because we already spend a lot of time in our motorhome, we have everything we need in there, from clothes, to dishes and kitchen utensils and gadgets, to tools. We really didn’t need three more garlic presses, or four more sets of baking pans, or another three pairs of pants, even if they were like new.

3. Garage sales are hard work: Everyone wants a better deal, and you need to restock daily. You’re basically running your own little retail store. At our first garage sale we sold a lot of the “good stuff” in the first couple of hours and then had to try to fill in the holes as we went along. The next weekend we had more items ready to go. People come back day after day, so having new things out is important.

4. Donating items to a charity or to your church may be a good way to get rid of some items. They can give you a receipt that you can use as a charitable donation on your tax return, and you’re helping out a good cause that helps people in your community that are in need.

5. “Stuff” is just stuff and can usually be replaced fairly easily. Our friends here in the RV resort sold their home a few years ago to become full time RVers. They put absolutely everything, including furniture, dishes, pots and pans, trinkets, etc., into storage as they planned that one day they would buy another home and could use all of it again. Now, almost four years later, they’ve decided that there are a few things that are valuable or are family heirlooms that they want to keep. However, for the most part, with what they have paid in storage charges they could have replaced everything else and had new things in their new home.

That’s a few things to be aware of or to consider.

Next week we’ll answer some more tax-related questions. Happy New Year! Have a great week.

We welcome your questions and inquiries. If you have tax-related questions, or any other questions that we may be able to address, please email us or comment below and we’ll try to answer them in a future article. You can email me at TheRVTaxGuy@gmail.com .

The material presented here is for informational purposes only and is not intended to
provide, and should not be relied on for tax, accounting or legal advice. Readers should
consult their own tax, accounting and legal advisors to discuss their own personal
matters.

Neil Seidler, CPA, CMA, has served businesses and individuals across the USA and Canada for 35 years. As an avid RVer and recent full-timer he has a unique perspective on RV tax issues.

Read Neil’s previous posts here.

##RVT929

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TravelingMan
9 months ago

Like you, we had 40 years of “stuff”…

It took a total of 8 months…We lived in a small town.

2 garage sales, postings on Craigslist, 2 Estate Sales, 5 Auctions, a lot to Goodwill and Salvation Army, and boy…was the trash man in for a surprise.

We still had more than we could put on the RV (weight wise) so “heirlooms” ended up at a family members house.

All in all, we netted very little for all of the work it took. Commissions and ads ate up a lot. Giving stuff away netted nothing.

One thing we learned from all of this is that “if” (not when) we every go back to sticks and bricks, we’ll buy back the same way we got rid of everthing. Cheap or free.

When you first start this idea, you have a vision of getting rich. But not even your own family wants anything. To the best of your ability, detach yourself and remember why you are doing this to begin with. Having nothing means that you don’t have to worry about or insure anything. It’s going to be liberating when you finally finish. You’ll still keep a few things. You will take a lot of pictures of everything you once had. For us, we thought about our age and the burden our parents created for us when it came their time to depart. Our kids won’t have to face that. They can probate using a Muniment of Title. It will literally be done in nothing flat. Not months or years like when we had to settle our parents estate.

We’ve been doing this for about 5 years now. We did the down sizing a couple of years after we started full timing. What a waste of money on storage fees, continued mortgage payments, utilities and the like. If you are still thinking about keeping your home while you “try” fulltiming, you may not be ready. If not, then trudge forward and don’t look back.

Since you are considering fulltiming, have you done your homework?

Have you established your budget?

Do you know what you will do about mail forwarding?

What will you do about your voter registration and drivers license?

Do you have mechanical skills and creativity when a breakdown occurs?

Are you prepared to be on the side of the road stranded for a while? What if there is no cell phone reception? What will you do? (and there are many places without it as we have discovered).

Will you boondock, stay in expensive parks or roadside parks?

How do you plan to protect yourself? Are you prepared?

Can you be apart from family for long periods of time in beyween?

What will you do if the park you had plans to stay in suddenly is filled by others? Do you have a backup plan?

Do you have pets? What a pain to deal with when you have to stay in a hotel while your rig is repaired for 3 or 4 months or when you want to go on that dream cruise. Or when you want to stop at a restaurant while on the road and everyone wants to turn you into PETA bacause your poor animal is stuck in the car (even in very suitable weather conditions). We love our pet, but you need to be prepared to deal with them.

These are but a few questions. There are plenty more to ask yourself before you make that big leap forward.

For us, every day is now Saturday (except when it is Sunday). We don’t regret getting rid of anything and we don’t look back. We now look forward to the next adventure!