Originally Posted by cmcguire48
Your RV is considered your second home and as long as it is outfitted like a home, shower, bed etc you can deduct the interest as long as you have paid the interest during the tax year. Also some states allow you to deduct RV taxes when you bought it. Additionally if you use it to entertain employees or clients then you can deduct it as a business office.
The interest comment is correct and you can deduct it as interest on a second home. If you also have another second home then you can only take one and obviously you would take the one with the higher interest. Sales taxes paid on an RV are also deductible providing you itemize your deductions and your sales tax paid, including the sales tax from the table for your state and locality, exceeds your state income tax paid. Again, you would take the higher of the two deductions.
The business comment is an entirely different matter. There have been a number of cases recently regarding RV's taken as business expenses. One of them involved a taxpayer taking an RV as an office in home. He lost his case because there was no separate and distinct office area in the RV. Another was a taxpayer doctor who used the RV as a resting area while he was between shifts at the hospital. The courts gave him his mileage from home to the hospital at $.56 a mile.
When you are thinking of taking an RV for a business expense you must establish a very strong case that the RV is a "necessary and ordinary" business expense. That requires some pretty severe documentation so be aware that it's not nearly as simple as saying "one of my customers had a drink in my motorhome" as being the justification for a mega deduction.