Potential new tax code

[Mr_D]

Originally Posted by Stuart W

Since when can you write off sales tax, please explain so I can understand, I’m am very serious, really want to know, thank you
Maybe this is an individual state thing?

When we bought the used Magna we were able to use the over $25,000 sales/use tax as a deduction on our 2015 taxes.

[Desertboyz]

A little bit off topic; we took advantage of our full-time status and have stayed out of our home state. We formed a Montana LLC and registered our motorhome there. No sales tax.

[tmw188]

Oh yah what's you company?


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[TJ]

Originally Posted by tmw188

Oh yah what's you company?

Sent from my iPhone using iRV2 - RV Forum

A Limited Liability Corporation (LLC) doesn't necessarily have to be " company." Rather, it is a legal entity that can own things that the principals can use. If you are a full-timer and have no permanent residence, a LLC can be beneficial. On the other hand, if you have a permanent residence in some other state and set up a LLC to shelter certain types of ownership, you may run into complications.

A good attorney is a valuable asset for a LLC principal!

We own property in two states...one of them being Montana...but since our legal residence for voting, etc. is not in Montana, our attorney advises against using a Montana LLC for RV ownership. It all depends on the specific circumstances of each individual.

TJ

[StevL]

Originally Posted by wildtoad

I’m fairly sure we can write off sales tax on major purchases here in SC.

Problem is maximum sales tax on an RV, boat, plane, car, etc here in SC is $300., not much to deduct.

Steve

[Dutch Star David]

Originally Posted by Dennis4809

Consider refinancing the sb and pay cash.

Check with your CPA. Last I checked interest on refinancing was not deductible.

[micbob4]

Originally Posted by tfryman

Ummmm, No; its on Schedule A. You don't use Schedule A unless you itemize.


And for the OP:

It's OK to finance the MH and pay interest on the outstanding balance, but only if you can deduct a portion of that interest on your taxes?

Not sure what you mean by "it's OK", but we have elected to put down 30% and finance as opposed to other options. Sure, would it be nice to be in situation that money is no issue and pay cash on all large purchases. As mentioned it was part of our decision process not the end all be all. Im extremely happy with our purchase and feel it will bring great memories. You guys have been awesome and can't wait until our unit is finally finished! Thanks

[wildtoad]

Originally Posted by StevL

Problem is maximum sales tax on an RV, boat, plane, car, etc here in SC is $300., not much to deduct.

Steve

True, another example of a benefit with not much impact. By the way, I think it has been boosted to $500.

[jharrell]

Originally Posted by StevL

Problem is maximum sales tax on an RV, boat, plane, car, etc here in SC is $300., not much to deduct.

Steve

Don't you guys have 7% income tax though? You would be deducting income tax instead, which would also go away under the new tax plan.

[wnytaxman]

As with most of the tax law, there is confusion and misinformation. What most folks don't realize is that the biggest piece of social legislation that we have is our tax law. The SALT deduction, state and local taxes, is meant to help those residents in high tax states where many of the services provided by the federal government are provided instead by the state government. The deduction for home interest, both first and second homes, was meant to help the housing industry and so on. There are provisions to help the poor and the wealthy and provisions to generate job creation.

The law that is proposed right now is only that, proposed. Nothing is in concrete at the moment and the likelihood of this law coming into play for 2017 is very, very slim. We will have the Thanksgiving recess and then a Christmas recess to make the passage less likely. The Senate also added some more Obamacare provisions which will muddy the waters even more.

Every time we have tax law changes there will be winners and losers. Worrying about what might finally end up as law today is similar to worrying about what the weather might be like in mid-January. It might be nice or it might be nasty. We'll just have to wait and see.

[StevL]

Originally Posted by jharrell

Don't you guys have 7% income tax though? You would be deducting income tax instead, which would also go away under the new tax plan.

That is true, we also deduct property tax, on my gas coach it's about $3,400. per year (varies by county), that number decreases a couple percent per year.

Boat another $1,400., three cars another $3,000., home add $3,500. more I would much rather pay a higher sales tax and not this property tax which goes on forever. The deduction is nice but it's still a small number IMO.

Steve

[wnytaxman]

One other item that I have not seen discussed in the proposed tax law is the solar credit. If you purchased solar for your rig this year there can be a tax credit of 30% on the cost of the solar installation. As a tax credit, it goes dollar for dollar agains the tax itself. Not enough for the trip to Barbados, but even a few hundred in savings helps to offset the cost of our hobby.

[CJ7365]

Originally Posted by wildtoad

Our taxes would be a lot lower if more people actually paid some. With all the deductions many perhaps over half don’t pay into the general fund. Payroll taxes and sales tax yes, none of that pays to run the country.

Thanks for bringing this up, also some are saying it will raise taxes on the lower income, well yes, if you don't pay taxes now, and you have to start, I guess it is, and so be it.

Everyone should pay taxes, although the .gov needs to control spending.


Just with the double standard deductions, I will pay $1500 less a year in taxes.

[Rvlegaleagle]

"Since when can you write off sales tax, please explain so I can understand, I’m am very serious, really want to know, thank you Maybe this is an individual state thing?"

It sure is Stuart

"No, Dan; you don't "get the value of the doubled deduction plus any deductions above that amount." Either you take the standard deduction or you itemize; one or the other."

True

"So, if I lose $20K in itemized deductions and gain $12K in the new standard deduction, I pay taxes on $8K more than I used to. That's a tax increase any way you look at it. And, that's just about where I'll be if this "tax reform" passes."

Yup


"Our taxes are too high I agree BUT government spending is WAY too high also. Something has to give or our grand kids are going to inheret a HUGE mess. Sorry for the rant!!"

Have 3 myself and they were screwed BEFORE they were born, HAS LITTLE TO DO WITH TAXES