RV Business Expenses
We are looking at working on the road. The question is when we are on the road in a motor home, what all can we write off as business expenses? The cost of travel? The cost of the motor home? Food...
Forum Discussion
WTP-GC wrote:The worry is not that the IRS will audit, disregard the deduction and you will owe the taxes. The worry is the IRS will disregard those deductions (and maybe a few others while they are at it) and you will owe the taxes, penalties and interest. Since they are generally a couple of years behind in audits, those penalties and interest will be several times the amount of back taxes. Then they decide to not only look at the year they are auditing, but they disallow those deductions for all they years they were taken, and that $1000 in taxes will rise to $20,000+ in multiple years of taxes, penalties and interest.
Seriously, almost everything is available as a business write-off...if you have a legitimate business (or at least one that remotely resembles a legitimate business). You have to think about the scale of things. For the stuff being discussed by the OP, you going to be doing this to effect of saving several thousand dollars at most?? I like to think about the worst case scenario in the event that your write-offs are scrutinized. In the most extreme case, the IRS will audit you and find out that you owe XXX dollars of taxes based on the "unapproved" write-offs. So the IRS picks you out of tens of thousands and makes you pay back a grand in taxes? And as long as you comply, you won't be in trouble.
However, here's one way I would approach it. I would reimburse myself from the company for every mile driven at the max allowable rate (more for towing). I would also assign per diem at the max rate (based on federal guidelines). Plus direct reimbursement for overnight hotel stays (based on location) is also legitimate. With those 3 factors alone, you can receive tons of tax-free income without even getting a sniff from the IRS.
But, as always, meticulous record keeping is key.
To deduct the depreciation and expenses on an RV, I would need to be on rock solid ground that the RV was NECESSARY for business, not just a convenience. And you would also need to be doubly sure the business was an actual business, not a hobby, and not a business that did not need to be run out of the RV.
I think most people would find the risk vs reward calculation to be in favor of not taking on the risk. The reward is too low.
