Travel Trailer and Camper Tax Parity Act
Travel Trailer and Camper Tax Parity Act
Plain Language Summary
# Travel Trailer and Camper Tax Parity Act Summary **What the bill does:** This bill would change tax rules for businesses that sell or lease travel trailers and campers. Currently, businesses can deduct interest they pay on loans used to buy motorized vehicles (like RVs) without limits, but they cannot do the same for loans on non-motorized trailers and campers. This bill would extend the same tax benefit to non-motorized campers and trailers, treating them the same way as motorized vehicles for tax purposes. **Who it affects:** The bill primarily benefits small and large businesses in the recreational vehicle and camping trailer industry, including dealerships and manufacturers.
It could indirectly affect consumers if businesses pass savings along through lower prices, though the main beneficiaries are business owners who finance inventory. **Current status:** The bill was introduced by Senator Joni Ernst (R-Iowa) in the 119th Congress and is currently in committee, meaning it hasn't yet been debated or voted on by the full Senate. It has not been enacted into law.
CRS Official Summary
Travel Trailer and Camper Tax Parity ActThis bill expands the exclusion of interest on floor plan financing from the limit on the tax deduction for business interest expenses to include interest on floor plan financing of certain non-motorized, towable campers and trailers. Under current law, the tax deduction for business interest expenses is generally limited to 30% of adjusted taxable income. (Some exceptions apply.) However, under current law, interest on floor plan financing (financing used to acquire inventory for sale or lease) of motorized vehicles (e.g., self-propelled vehicles designed to transport people) is excluded from the limit on the tax deduction for business interest expenses.Under the bill, the exclusion of interest on floor plan financing from the limit on the tax deduction for business interest expenses is expanded to include interest on floor plan financing of any camper or trailer designed to (1) provide temporary living quarters for recreational, camping, or seasonal use; and (2) be towed by, or affixed to, a motor vehicle.
Latest Action
Read twice and referred to the Committee on Finance.