JoeTampa wrote:
Are there any tax benefits of any kind if you own the RV outright?
Actually, when you do the math, The "home owners deduction" is against income and is not a tax credit for the amount of interest paid. Thus, you only get "back" a percentage of what you pay in interest. If you were not paying interest you would pay about 1/3 of the money you don't pay in interest as taxes (in Other words you have about 2/3 or the money that you would have spent on interest to spend on other things). Of course the actual percentage depends on your full marginal rate, but you don't get all of you're interest expenses back in your tax refund. For example, if you are paying $5000 in interest a year, you actually pay about $1600 less taxes. If you are paying no interest you will have an additional $3350 in disposable income to "play" with. Yes, you pay $1600 more taxes, but the net is more money to spend and you don't have the interest payments. The actual numbers may vary depending on your total taxable income, etc.
The Home owners interest deduction is good when you have to have the loan, but once the loan is gone you will have more money to spend even with the additional tax payment.
So, take advantage of the interest deduction if you have to have the loan, and enjoy the extra money when you pay it off :-)
