Do you own an RV? Are you a full-timer? Part-timer? Do you use it for business purposes? Do you travel for vacation with your family? Let’s review the top 9 RV tax benefits and deductions so you can get the most out of your taxes.
Primary RV Tax Benefits and Deduction for RV Owners
RV ownership offers several opportunities for tax deductions. Here are four main deductions you may be able to take advantage of:
- Mortgage Interest Deduction on your primary or secondary home
- Sales Tax Deduction when you purchase your RV
- State or Local Property Tax on the RV
- Business Deductions related to travel, rental income, and depreciation
Keep reading to see these deductions and more explained in more detail.
Is It Possible to Write Off an RV as a First or Second Home?
RVs, as long as they include a sleeping area, cooking facilities, and bathroom, generally meet the IRS definition of a residence. This means you may be able to deduct mortgage or loan interest as a second home IF you itemize deductions. However, modified vans or other vehicles without these features may not qualify.
Yes. Your van needs a bathroom to qualify as a home.
Does an RV Qualify for Section 179 Depreciation?
If your RV is used for business more than 50% of the time, it may qualify for the Section 179 expense deduction, subject to limits. Section 179 doesn’t apply to RVs reported as rental property on Schedule E. If you’re renting out an RV on your property like an Airbnb, you would not qualify for Section 179 Depreciation.
Can RV Campground Fees Be Deducted?
Campground fees may qualify as a business lodging expense if you’re using the RV for business-related travel. However, full-time RVers won’t qualify since they’re not duplicating lodging costs by traveling away from a primary residence.
As a full-timer, you are always home and therefore, never traveling via your RV for work purposes.
Can I Use the Home Office Deduction in My RV?
To claim a home office deduction, the space must be used exclusively and regularly for business purposes. Because RVs often lack a dedicated, exclusive office space, most RV owners won’t qualify. Additionally, only business owners can claim the home office deduction—not employees.
Do Travel Trailers and Fifth Wheels Qualify for the Mortgage Interest Deduction?
Despite rumors following the 2017 Tax Cuts and Jobs Act (TCJA), towable RVs like travel trailers and fifth wheels are still eligible for the home mortgage interest deduction. These RVs can be classified as either a primary or secondary residence, making the interest deductible.
Can an RV Be Your Primary Residence?
Yes, if your RV is where you live for most of the year, you can declare it as your primary residence for tax purposes. To qualify, the RV must have essential facilities such as sleeping, cooking, and bathroom amenities. This opens the door to potential deductions, like the home mortgage interest deduction if you itemized deductions.
Can I Deduct My RV on My Taxes?
Whether or not your RV can be deducted on your taxes depends on your specific situation, including whether you itemize your deductions or take the standard deduction, whether you have a business, if you only use the RV for business purposes, if you travel part-time or full-time, and more.
As you can see, there is no one-size-fits-all answer to this question. Generally speaking, an RV should not be purchased for the tax write-off.
Is Interest on an RV Loan a Tax Write-off?
Yes, interest on an RV loan may be deductible as mortgage interest for either a primary or secondary residence. To qualify, the loan must be secured by the RV, and the RV must have sleeping, cooking, and bathroom facilities.
Can an RV Qualify for Bonus Depreciation?
Under the TCJA, RVs purchased between September 27, 2017, and January 1, 2023, qualify for 100% bonus depreciation if used for business purposes. A full-time RVer will not qualify for bonus depreciation ever.
This allows you to depreciate the full cost of eligible RVs in the year they’re placed in service. However, purchases made after 2023 will see a gradual reduction in the bonus depreciation percentage. Keep in mind this could change in any given year as the tax laws change.