I have hear that (In the US) when you buy a sailboat suitable to live aboard
the interest paid on the loan are tax deductible.
I would appreciate if someone can enlightens me on this subject.

TIA

"Denis Marier" wrote in message
...
I have hear that (In the US) when you buy a sailboat suitable to live
aboard
the interest paid on the loan are tax deductible.
I would appreciate if someone can enlightens me on this subject.

TIA

If it has a head and galley, then you can deduct it as a 2nd home. That
feature was a real selling point with my wife.

-Greg

"Dene" wrote in message
. ..

"Denis Marier" wrote in message
...
I have hear that (In the US) when you buy a sailboat suitable to live
aboard
the interest paid on the loan are tax deductible.
I would appreciate if someone can enlightens me on this subject.

TIA

If it has a head and galley, then you can deduct it as a 2nd home. That
feature was a real selling point with my wife.

-Greg

True enough, but that's not the end of the story of course. The IRS can
audit you nevertheless. You will need to show that you actually have been
using it as such. In addition, if it's very close to where you live, they
may disallow it. I believe it also has to have sleeping accomodations. I'm
not a CPA, so I suggest asking one before you attempt it. "Vacation" homes
are one of the many red flags that could (but don't always) precipitate an
audit.

--
"j" ganz @@
www.sailnow.com

"Capt. JG" wrote in message
...

True enough, but that's not the end of the story of course. The IRS can
audit you nevertheless. You will need to show that you actually have been
using it as such. In addition, if it's very close to where you live, they
may disallow it. I believe it also has to have sleeping accomodations. I'm
not a CPA, so I suggest asking one before you attempt it. "Vacation" homes
are one of the many red flags that could (but don't always) precipitate an
audit.

--
"j" ganz @@

www.sailnow.com

Actually, there are no such requirements, though I've been told that there
were in the past. This was from a professional tax preparer. All the boat
has to have are places to sleep, eat and go. While I had loans I wrote off
my first two boats in this fashion, as second mortgages.

John Cairns

Actually, there are no such requirements, though I've been told that there
were in the past. This was from a professional tax preparer. All the boat
has to have are places to sleep, eat and go. While I had loans I wrote off
my first two boats in this fashion, as second mortgages.

That is my understanding also, and my deductions have never been
challenged. The only restriction that I am aware of is that you are
only allowed one "second home" deduction. If you have a summer place
and a boat, or two cruising boats, you have to choose which to take the
deductions on.

It is also my understanding that there is a movement afoot in
Washington to eliminate the second home deduction entirely. I'm not
sure how far this has progressed but it would probably be a good thing
to write your representatives about.

"John Cairns" wrote in message
...

"Capt. JG" wrote in message
...

True enough, but that's not the end of the story of course. The IRS can
audit you nevertheless. You will need to show that you actually have been
using it as such. In addition, if it's very close to where you live, they
may disallow it. I believe it also has to have sleeping accomodations.
I'm not a CPA, so I suggest asking one before you attempt it. "Vacation"
homes are one of the many red flags that could (but don't always)
precipitate an audit.

--
"j" ganz @@

www.sailnow.com

Actually, there are no such requirements, though I've been told that there
were in the past. This was from a professional tax preparer. All the boat
has to have are places to sleep, eat and go. While I had loans I wrote off
my first two boats in this fashion, as second mortgages.

John Cairns


I thought I said that... eat, sleep, head...

--
"j" ganz @@
www.sailnow.com

"John Cairns" wrote in message
...

"Capt. JG" wrote in message
...

True enough, but that's not the end of the story of course. The IRS can
audit you nevertheless. You will need to show that you actually have been
using it as such. In addition, if it's very close to where you live, they
may disallow it. I believe it also has to have sleeping accomodations.
I'm not a CPA, so I suggest asking one before you attempt it. "Vacation"
homes are one of the many red flags that could (but don't always)
precipitate an audit.

--
"j" ganz @@

www.sailnow.com

Actually, there are no such requirements, though I've been told that there
were in the past. This was from a professional tax preparer. All the boat
has to have are places to sleep, eat and go. While I had loans I wrote off
my first two boats in this fashion, as second mortgages.

John Cairns

Perhaps I'm missing what you're saying by "there are no such requirements."

--
"j" ganz @@
www.sailnow.com

You said:

You will need to show that you actually have been
using it as such [second home]. In addition, if it's very close to where you live, they
may disallow it.

There is no IRS requirement for either of the above that I am aware of.

On 2 Jan 2006 07:23:52 -0800, wrote:

You said:

You will need to show that you actually have been
using it as such [second home]. In addition, if it's very close to where you live, they
may disallow it.

There is no IRS requirement for either of the above that I am aware of.

You are correct. From the horse's mouth (IRS Pub 936):

*******************
Qualified Home

For you to take a home mortgage interest deduction, your debt must be secured by a
qualified home. This means your main home or your second home. A home includes a
house, condominium, cooperative, mobile home, house trailer, boat, or similar
property that has sleeping, cooking, and toilet facilities.

The interest you pay on a mortgage on a home other than your main or second home may
be deductible if the proceeds of the loan were used for business, investment, or
other deductible purposes. Otherwise, it is considered personal interest and is not
deductible.
Main home. You can have only one main home at any one time. This is the home where
you ordinarily live most of the time.

Second home. A second home is a home that you choose to treat as your second home.

Second home not rented out. If you have a second home that you do not hold out for
rent or resale to others at any time during the year, you can treat it as a qualified
home. You do not have to use the home during the year.
**********************

--
John H.

"Divide each difficulty into as many parts as is feasible and necessary to resolve it."
Rene Descartes

Sounds right, but as usual, the IRS will audit you if they believe something
isn't kosher. Suggestion: make sure you've got all your receipts.

--
"j" ganz @@
www.sailnow.com

"JohnH" wrote in message
...
On 2 Jan 2006 07:23:52 -0800, wrote:

You said:

You will need to show that you actually have been
using it as such [second home]. In addition, if it's very close to where
you live, they
may disallow it.

There is no IRS requirement for either of the above that I am aware of.

You are correct. From the horse's mouth (IRS Pub 936):

*******************
Qualified Home

For you to take a home mortgage interest deduction, your debt must be
secured by a
qualified home. This means your main home or your second home. A home
includes a
house, condominium, cooperative, mobile home, house trailer, boat, or
similar
property that has sleeping, cooking, and toilet facilities.

The interest you pay on a mortgage on a home other than your main or
second home may
be deductible if the proceeds of the loan were used for business,
investment, or
other deductible purposes. Otherwise, it is considered personal interest
and is not
deductible.
Main home. You can have only one main home at any one time. This is the
home where
you ordinarily live most of the time.

Second home. A second home is a home that you choose to treat as your
second home.

Second home not rented out. If you have a second home that you do not
hold out for
rent or resale to others at any time during the year, you can treat it as
a qualified
home. You do not have to use the home during the year.
**********************

--
John H.

"Divide each difficulty into as many parts as is feasible and necessary to
resolve it."
Rene Descartes