Boat as Second Home - Tax Break?

[Capn Santiago]

I was told my boat would qualify for 2nd Home tax advantage here in Texas. Since purchasing it I have been unable to find out how to take advantage of the sales tax and interest financing tax breaks. I have searched the Web and visited http://www.window.state.tx.us/taxinfo/proptax/exmptns.html where it says I can have Homestaed Exemption on only one property, which is of course my home.
Can I get any tax breaks on my interest and sales tax for my boat and if so how do I do that?

 

[RubberFrog]

Re: Boat as Second Home - Tax Break?

irs.gov

We deduct ours from our federal every year. Ask your lender for an interest statement at the end of the year.

 

[bekosh]

Re: Boat as Second Home - Tax Break?

Here is a simple article on the subject.
http://www.discoverboating.com/buying/financing/taxdeduct.aspx
Also check www.IRS.gov and your tax preparer.

According to IRC section 163(h)(4), a boat will be considered a qualified residence if it is one of the two residences chosen by the taxpayer for purposes of deductibility in the tax year. A qualified residence must have basic living accommodations including sleeping space (berth), a toilet (head), and cooking facilities (galley). If the boat is also chartered, the taxpayer will have to use the boat for personal purposes for either more than 14 days or 10% of the number of days during the year the boat was actually rented, to qualify for the interest deduction in accordance with IRC section 280A(d)(1).

 

[G-Daddy]

Re: Boat as Second Home - Tax Break?

There is one additional tax break you can qualify for if it's a new purchase. You can deduct either sales tax or state and local income tax. For the sales tax you can take tax actually paid or a formula based on residence and income. For large ticket items like a second residence (boat or rv), airplane, car, etc, you can take both the large ticket item actuals and the formula amount. For the residence portion quoted above or the sales tax deduction, you must be able to itemize dedcutions on your 1040.

 

[tashasdaddy]

Re: Boat as Second Home - Tax Break?

see your personal accountant. CPA, tax professional.