Can You Claim a Travel Trailer on Taxes?

by Steve Lander ; Updated December 08, 2017
Don't hide from the IRS -- trailer deductions can be legal.

If you think of your travel trailer as a home away from home, you aren't the only one. The Internal Revenue Service may also consider your travel trailer to be a home. If yours qualifies, you may be able to write off any interest you pay on a loan for it. To qualify for write-offs on your travel trailer, though, you'll also need to itemize your deductions on Schedule A.

Home Qualification

The IRS applies a relatively simple test to figure out if your travel trailer is a home and qualifies for the mortgage interest deduction. To qualify, it needs to have a place to sleep, a place to cook and a toilet. IRS Publication 936 even specifically identifies house trailers, mobile homes and boats as being eligible to be considered a home.

Second Home Interest Deduction

The IRS lets you write off the home mortgage interest on your first and second homes up to the interest on up to $1,000,000 in debt, as of the 2016 tax year, plus an additional $100,000 in home equity debt that doesn't have to be tied to buying or improving a home For the debt to qualify as a mortgage, it needs to hold the property as collateral. In other words, if you use your credit card to buy your trailer, the loan won't be deductible. However, if you use a loan that specifically names your trailer as collateral and lets the lender take your trailer back if you don't pay it, it'll be deductible.

Video of the Day

Personal Property Tax

Whether or not you deduct the loan interest on your travel trailer, some of the annual taxes that you pay on it may be tax deductible. The IRS allows you to deduct any personal property taxes you pay as long as they're charged annually and are based on the value of the property that is taxed. While many taxpayers use this write-off to deduct the portion of their car's registration that is tied to its value, you can also use it to deduct registration taxes on boats, airplanes or a trailer.

Deducting Your Tow Vehicle

Unlike a recreational vehicle, which combines a vehicle with a trailer, making both deductible, your tow vehicle is physically separate from your vehicle and, as such, the interest on it isn't deductible. However, if you take out a home equity loan against your primary residence and use it to buy your tow vehicle, the interest on your equity loan is deductible, up to the first $100,000 in debt. This can effectively give you a write-off for your tow vehicle's interest, too. The drawback to doing this is that you're putting your house up as collateral for a car or truck, which can be risky.

About the Author

Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.

Photo Credits

  • Andy Reynolds/Lifesize/Getty Images
Cite this Article A tool to create a citation to reference this article Cite this Article