Tax question?????

[ArcticDiver]

My apologies, you are quite right, you merely stated the case about social engineering without coming out for or against it. And you are also right about the near impossibility of getting tax reform at this point. The people who are truly hurt by income tax policy are in the minority.

Thank you. You are the kind of person I can have a good discussion with; one that might even lead to a meeting of the minds, eh?

I look forward to an opportunity to meet and maybe even dive with you.

 

[rjack321]

We are looking real hard at a sailing Yacht and a question came up. To use it as a write off, must it be a boat loan or can a sig loan also be used? Thanks.

Back to the original question, I don't think the IRS cares what kind of loan you have if you are trying to have a "second home" deduction. You will need an end of year statement detailing the amount of interest paid. If you don't get a 1099-int (because you have some other type of loan) there are places to fill in the amount paid and to whom - just like if you had seller financing.

Size is also not relevant. Head and a kitchen are required.

 

[Wildcard]

Thanks for the info!

 

[rjack321]

I claimed a 2nd home on a 34' trawler for a couple of years - but was never audited on it so YMMV.

 

[matt_unique]

To use a boat as a write off, it has to have sleeping quarters, cooking ability, pressure water, and at least a porta potti.

As for business, that's been covered above. One of the biggest advantages we have in Michigan by using the boat for business is we can recoup some of the road tax that is paid on the fuel for the boat. In 2006, it's 19.6 cents per gallon.

Check the IRS pubs or call them to be sure. I recall you had to spend a minimum amount of time at this 2nd residence in order to claim it as a 2nd home as well. If you were audited you would need to prove all that you claim.

--Matt

 

[Cacia]

that's true...with a boat that would be the easy part for him.

Of course, unless he spent the year in Alaska...

I wonder if they own a home 10 minutes away, if that would be an issue?

My marina has a no livaboard policy...so it would not work for us, unless we could say we spent x number of days sleeping in some harbor like Molakai.

Anybody here had an audit? Are they kinder, gentler, IRS now...or does it just depend who you get?

I still think being "seperated" for a few weeks a year and saying you stayed on your boat seems plausible.

 

[Wildcard]

I think we will end up using the Homer house as our second home and try a business with the boat. Skippered bare boat kind of thing.

 

[rjack321]

I think we will end up using the Homer house as our second home and try a business with the boat. Skippered bare boat kind of thing.

One of you have the license for that? Oh and insurance (ugh)

 

[Tom Winters]

Think long and hard before you try the boat charter option. The insurance will be a tough nut, and it's pretty competitive. You need a captain's license with the sailing endorsement as well.
The second home afloat was a definite go though. Can't rent out the Homer home for a passive investment?