This week, Senator Joe Donnelly (D-IN) introduced a bill to fix an error in last year’s tax reform bill that inadvertently removed travel trailers from the definition of “motor vehicle” for the purposes of floor plan financing interest deductibility.
During Advocacy Day, members from across the RV industry asked their Members of Congress to address this issue. The introduction of the Travel Trailer and Camper Technical Corrections Act, a companion bill to the House bill introduced earlier this month, is in response to the calls from the RV industry during those meetings.
The proposed changes in the bills impact RV trailer dealers with more than $25 million in annual sales. Other dealers, including boats, motorhomes, conversion vans, motorcycles and automobiles, can fully deduct interest paid on their inventory floor plans. However, RV trailer net interest deduction is limited to 30 percent of earnings before interest, taxes, depreciation, amortization and depletion. It is estimated that four out of every ten dollars spent at an RV retail establishment is generated by a dealer with $25 million or more in annual sales.
"Indiana’s RV industry is essential to our state’s economic success with its more than 20,000 Hoosier workers," said Senator Donnelly, co-chair of the Senate RV Caucus. "This bill is a common-sense fix that ensures both motorhomes and towable RVs are treated the same under the U.S. tax code."
All 50 states define and regulate towable RVs and campers as motor vehicles. Through a small, technical fix, this bill ensures that motorized and non-motorized campers and travel trailers are treated the same under the U.S. tax code.
Ask your Member of Congress to support the Travel Trailer and Camper Technical Corrections Act today!