We have been trailer shopping since the beginning of the year. We were going to buy a BP, then a GN, then a GN with weekender LQ, back to smaller budget and a BP, now reconsidering the GN...
Bottom line, we haven't made up our mind. We originally planned to finance over 5 years, but have gotten to thinking that we really might be better off with a GN and financing over 10 years. I think we're now pretty set on a GN, but are going back and forth about no LQ vs. a weekender.
Will the tax deduction as a 2nd mortgage that we could take on a trailer with a LQ really amount to all that much?
Posted 2012-08-24 10:58 PM (#146582 - in reply to #146580) Subject: RE: tax benefit?
Regular
Posts: 50 Location: Hillsboro OH
Affordability isn't the issue, it's whether the tax benefits "pay for" the higher price. We don't really need the LQ, at least we don't plan to camp a lot now, but in the future we might do more/travel farther. Should we invest more now, with an eye to possible resale/trade value in the future?
Posted 2012-08-24 11:35 PM (#146584 - in reply to #146580) Subject: RE: tax benefit?
Regular
Posts: 50 Location: Hillsboro OH
Thanks, Spin Doctor--I suspected that would be the case.We've also debated new vs. used. Leaning towards a warranty and knowing exactly what's been done to the trailer.We're thinking about heading to Quarter Horse Congress in October to look at some trailers in person. Maybe we'll find the perfect trailer there.
Posted 2012-08-26 9:49 AM (#146594 - in reply to #146582) Subject: RE: tax benefit?
Expert
Posts: 3853 Location: Vermont
Originally written by balakai on 2012-08-24 10:58 PM
Affordability isn't the issue, it's whether the tax benefits "pay for" the higher price. We don't really need the LQ, at least we don't plan to camp a lot now, but in the future we might do more/travel farther. Should we invest more now, with an eye to possible resale/trade value in the future?
There may be a change in tax laws coming real soon...which would eliminate this deduction...
Posted 2012-08-26 11:52 AM (#146600 - in reply to #146580) Subject: RE: tax benefit?
Elite Veteran
Posts: 714 Location: Minnesota
Sorry about thet. According to my tax man all you can deduct is the actual cost of the LQ. The rest of the cost of the base trailer is NOT deductible as it is not actually used for your living space. And to top it off all you can deduct is the interest payment. The tax deduction is not a good reason to buy a LQ trailer if it would make the payments hard to afford.
Posted 2012-08-26 1:44 PM (#146603 - in reply to #146580) Subject: RE: tax benefit?
Regular
Posts: 50 Location: Hillsboro OH
Nope, payments wouldn't be hard to afford. Just seeing if it would tip the scales in favor of buying a LQ instead of a "plain" GN, maybe with AC in the dressing room so we could dry camp if we wanted to.
Just don't know how much we'd really use this trailer for overnight camping. Is it worth spending $7-8K more? Just don't know.
Posted 2012-08-28 8:59 AM (#146645 - in reply to #146580) Subject: RE: tax benefit?
New User
Posts: 4
Location: Collinsville, TX
Something you're all missing here. You can only get a tax benefit and write-off as a 2nd mortgage if the living quarters is a full living quarters. That means it must contain a fridge, shower, toilet, AND cook-top (stove). If the unit does not contain a stove, then it is not considered a full living quarters. Check with your insurance company for what qualifies as full living quarters (or tax accountant). Insurance for full lq's is much higher. My trailers has everything but a store and it was a significant difference in the insurance premium vs a full lq.
Posted 2012-08-28 9:31 AM (#146646 - in reply to #146580) Subject: RE: tax benefit?
Expert
Posts: 2958 Location: North Carolina
Weight ... Remember you're hauling around something that you don't use. Fuel isn't cheap anymore. AND stuff gets old just setting, hoses get brittle, plastic cracks, wood warps. The LQ value drops with age.
Posted 2012-08-28 1:50 PM (#146664 - in reply to #146580) Subject: RE: tax benefit?
New User
Posts: 4
Location: Collinsville, TX
Posted this earlier, not sure why it's not showing, but ... tax benefit, or writing off as a 2nd mortgage depends on whether or not the trailer has a 'full' living quarters. A full LQ is defined as having a fridge, shower, toilet, AND stove. If the trailer does not have a stove, then it does not qualify as 'full' LQ. When I went to insure my trailer, without the stove, the premium is drastically different as with a stove. With the stove, the unit qualifies as an RV and would cost more. Check with your tax accountant to be sure (or insurance agent).
tax benefit?
And there is also the insurance costs difference between an LQ and non-LQ trailer