Ever thought of using a recreational vehicle like a boat to lower your taxes? Yes, it’s possible using the right strategies, and there’s no time like the present to make that happen.
Even more than pre-pandemic taxpayers may be considering buying their own island. Those for whom buying an actual island is beyond the budget may be considering buying a boat or an RV for use as a residence, an office, or both.
Whatever the type of use, there are tax strategies available for boat owners if they meet the requirements. As with any tax strategy it is important to have a full understanding of the requirements to ensure the deduction is legal and to ensure the taxpayer can substantiate the deduction should the tax authorities examine the return.
This is the first of two articles discussing the tax strategies available to boat owners. Part 1 focuses on using a boat as a residence, but if that doesn’t meet your needs, stay tuned because Part 2 will cover boats for business use (including as a home office). Why not consider both options and see how your tax savings can help fund your floating condo? Keep reading to learn more.
10 Ways Certified Tax Planners Can Prepare for Increased IRS Focus on Documentation During Audits
The IRS is ramping up scrutiny of high-net-worth individuals and businesses, increasing audit rates by over 50% for those earning above $10 million. Recent IRS initiatives backed by Inflation Reduction Act funding have intensified enforcement on wealthy taxpayers, large partnerships, real estate investors, and tech businesses. IRS agents are digging deeper during audits and expecting taxpayers to produce more documentation to support every position on their returns. To help clients navigate this environment, certified tax planners must take proactive steps to bolster documentation and audit readiness. Below are ten authoritative strategies, complete with industry examples, IRS policy references, and best practices, to prepare for the increased IRS focus on documentation.
