Tax Time Tidbits

[TXiceman]

I think once you use the RV as a part of your business and carry your product in the RV, it become commercial.

Ken

[wnytaxman]

From my perspective I don't really see a meshing of tax law with DMV laws in this regard. For example, let's say I have my laptop with me and I have my tax program on my laptop. Whether I do tax returns on my laptop within my RV would basically be irrelevant as to the usage of the rig. Or even more, out there, the fact that I have my business laptop with me would not make the rig a business vehicle from a licensing standpoint. I do agree that if I am carrying merchandise or passengers then my RV would probably qualify as a business vehicle for DMV purposes. DMV does not have access to federal tax returns, so it may be a moot point other than being caught in the act so to speak.

[redbaron73]

I believe the big thing that gets flagged is advertising on the outside of the RV. Absent that, I agree it would be a stretch to ever worry.

[wnytaxman]

I would even question the ability of a DMV to say the vehicle is a commercial vehicle just because it had advertising of some kind on it. If that argument could hold up then all of us who drive rigs that have the name of the brand or the dealer or both all over them would have issues. However, I don't think I would want to chance being the test case for some over zealous agency or enforcement person.

[RustyJC]

Racers who were pulling decal-laden trailers have been targeted for commercial enforcement on the basis that racing for prize money constitutes commercial activity and transport of a racing vehicle is part and parcel of that activity.

Rusty

[wnytaxman]

Originally Posted by RustyJC

Racers who were pulling decal-laden trailers have been targeted for commercial enforcement on the basis that racing for prize money constitutes commercial activity and transport of a racing vehicle is part and parcel of that activity.

Rusty

Very good point Rusty. As the saying goes, discretion is the better part of valor.

[Francesca]

So...as an effort to get back on-topic, which I thought was income taxes rather than licensing requirements etc:

Are equipment-related tickets/special drivers licenses deductable?

[Air Baron]

Also in an effort to get back on topic:

I recently became licensed as an independent insurance adjuster. Last year we bought our motorhome, sales tax and all, moved out of the house and are now full-timing and enjoying all that this wonderful country has to offer. Although an opportunity presented itself in November to deploy to New York State after Hurricane Sandy, I declined and we headed south. Therefore I have yet to have any business income.

FYI when deployed, all expenses are mine and mine alone...anywhere, anytime. That includes transportation, lodging, meals, communications, insurance, blah blah blah.

I see this as a tax nightmare. When did I buy what, when was I deployed and for how long? When not deployed, what was I doing? What is personal, what is business? See where I'm going with this? Is a professional tax consultant/CPA in order here?

[Francesca]

It'll be interesting to hear what WNYtaxman has to say about your situation, Air Baron.

But one would think that to claim a business deduction one would need to have some business income to deduct it from!

I'm probably all wet in that department, though.

[Air Baron]

Originally Posted by Francesca

It'll be interesting to hear what WNYtaxman has to say about your situation, Air Baron.

But one would think that to claim a business deduction one would need to have some business income to deduct it from!

I'm probably all wet in that department, though.

I agree and don't think you are all that wet.

Adjusters typically have costs such as airplane tickets to/from the disaster, car rentals, motel rooms with DirecTV, restaurant receipts, internet service, cell phone service...all of which are 100% deductible against any income from the adjusting companies/insurance carriers. The way I see it, having a motorhome, with a kitchen and DirecTV and everything else...covers most of those costs. Therefore it should be 100% deductible, even including the necessary DW for support. Am I wrong?

Businesses have startup costs and not all businesses are always operated at a profit. Expenses can outweigh receipts, resulting in a loss. Losses can be carried forward to the following year. How many years can this go on in the eyes of the IRS? When I hopefully get deployed this year, I certainly intend to deduct a fair and equitable proportion of all my motorhome costs...including it's acquisition.

I never considered any commercial aspects of my using a motorhome to support my business. It is my transportation and residence, period. The DMV and insurance company need not concern themselves with anything else.

[Scooter]

After reading all these posts........is there any doubt the ENTIRE tax code needs to be abolished and a simpler one or two page IRS tax form can be substituted ????

Based on a certain .......% to take care of government expenses or a consumption tax or a value added tax???

EVERYTHING related to a deduction, personal or business, needs to be abolished.

Geeze, look at all the blather about RV's and deductions. Tax lawyers and accountants are getting rich on the confusion and endless court rulings and related BS. Our elected representatives are feeding high on the hog from introducing more and more tax legislation (which are filled with loopholes..... on purpose,) from their corporate pimps.

Put this in a new thread if this is considered thread hi-jacking.

[wnytaxman]

Originally Posted by Francesca

So...as an effort to get back on-topic, which I thought was income taxes rather than licensing requirements etc:

Are equipment-related tickets/special drivers licenses deductable?

By tickets I assume you don't mean traffic tickets but rather professional licenses. As an employee professional licenses are deductible as a miscellaneous itemized deduction. As a business licenses are a deductible business expense.

[wnytaxman]

Originally Posted by Air Baron

I agree and don't think you are all that wet.

Adjusters typically have costs such as airplane tickets to/from the disaster, car rentals, motel rooms with DirecTV, restaurant receipts, internet service, cell phone service...all of which are 100% deductible against any income from the adjusting companies/insurance carriers. The way I see it, having a motorhome, with a kitchen and DirecTV and everything else...covers most of those costs. Therefore it should be 100% deductible, even including the necessary DW for support. Am I wrong?

Businesses have startup costs and not all businesses are always operated at a profit. Expenses can outweigh receipts, resulting in a loss. Losses can be carried forward to the following year. How many years can this go on in the eyes of the IRS? When I hopefully get deployed this year, I certainly intend to deduct a fair and equitable proportion of all my motorhome costs...including it's acquisition.

I never considered any commercial aspects of my using a motorhome to support my business. It is my transportation and residence, period. The DMV and insurance company need not concern themselves with anything else.

Without any income, it would be hard to justify a lot of the deductions, however, if you can show that you are trying to make a profit, that you run your business in a business like fashion, and that your efforts are consistent with a profit motive, you may be okay, up to a point. If you have some income even though you are operating at a loss, it would give credence to you having a profit motive. There's a ton of cases out there on hobby businesses, although insurance adjuster is not one of them, that go both ways as to being allowed or being bounced.

[wnytaxman]

Originally Posted by Scooter

After reading all these posts........is there any doubt the ENTIRE tax code needs to be abolished and a simpler one or two page IRS tax form can be substituted ????

Based on a certain .......% to take care of government expenses or a consumption tax or a value added tax???

EVERYTHING related to a deduction, personal or business, needs to be abolished.

Geeze, look at all the blather about RV's and deductions. Tax lawyers and accountants are getting rich on the confusion and endless court rulings and related BS. Our elected representatives are feeding high on the hog from introducing more and more tax legislation (which are filled with loopholes..... on purpose,) from their corporate pimps.

Put this in a new thread if this is considered thread hi-jacking.

Your frustration over the tax code is shared by many including those of us in the tax profession. The problem of the tax code is twofold. It is complex in an effort to be fair is the first problem. The second problem is that over the years Congress and various administrations have used the tax code as methods to stimulate certain parts of the economy or for some social purpose. Put those two things together and you have a very, very complex set of laws.

I hear a lot of people jump on the consumption tax or national sales tax bandwagon. Canada has a national sales tax or value added tax called a GST. If you would like to see how people get around that tax stop in any mall here on the US/Canada border on a weekend. Our malls are packed with Canadians shopping here at least partly to avoid those same taxes.

Getting back on topic, business use of any RV can be very difficult to prove. Remember in tax the burden of proof is on the taxpayer. You have to be able to prove that you use the RV, at least to some extent for business. As I tell clients....document, document, document. Make sure that you have some level of independent confirmation of your business usage.