The recently passed tax reform bill will benefit the RV industry and further the industry’s current period of historic growth, according to the Recreational Vehicle Industry Association (RVIA).
But one thing it won’t do is help the owners of towable RVs. For many years, owners of all types of self-contained RVs could deduct the interest on their RV loan as a second home. The new tax will allow a deduction of interest on mortgages up to $750,000, for purchases of first and second homes, which can include RVs, but only motorized ones.
The new law only allows deduction for “any self-propelled vehicle designed for transporting persons or property on a public street, highway, or road,” which does not include towable RVs such as travel trailers and fifth wheels.
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RVIA says it will work with the House Ways and Means Committee and the Senate Finance Committee to include a change to the definition in a technical corrections bill which will likely be needed next year as other oversights and unintended consequences become known.
But, for now, if buying a towable RV is in your plans, don’t count on taking a tax deduction on the loan interest. If you already own a towable RV and have been deducting the interest, contact your tax professional to learn how this applies to you.