Last year’s major tax overhaul just might give you a reason to buy a boat. It’s no secret that a growing number of economists are predicting economic uncertainty ahead, and it’s why some advisors are steering their clients toward alternative tax-beneficial investments such as boat ownership.
The new tax regulations offer good news for boaters. Both used and new boats can be purchased to take advantage of many of the same tax benefits of a newly purchased home. Buyers get acquisition debt and home equity debt deductions for their purchase. A new provision allows buyers who operate as an LLC or corporation that rents or charters the vessel for at least part of the year to write off 100 percent of the purchase price as “bonus depreciation” in the year of the purchase.
There’s no dollar limit, and the tax break can be used to cover any improvements made or equipment purchased for your boat up to a year after you buy it – including accessories like canvas tops or high-grade marine windows. Here’s what else is new in the boating world
GPS Goes Out On the Water
It’s nearly impossible to get lost on land, thanks to GPS tracking and smartphones. It’s also likely that our cars will start driving themselves in just a matter of years. So, it shouldn’t come as a surprise that this same benefit is coming to open water.
Many marinas have already begun to implement automatic identification systems (AIS). These systems allow GPS aided location and communications between boaters and the marina. It’s more effective and precise than radar, allowing the marina or anyone on land to know exactly who’s out on the water and where they are.
It also adds a level of security for boat owners. This GPS technology helps keep track of boat movement. The deeper connectivity allows for more efficient property monitoring and theft prevention.
And, just maybe, the technology will help to usher in self-sailing boats. Manufacturers are working on integrating the same technology used on container ships and luxury yachts to create advanced autopilot systems.
Keeping Your Boat Close to Home
There’s more to think about even if your tax advisor does give you the green light to take advantage of new IRS regulations and buy a boat. You’ll still have to figure out where to keep it. Marina slip rentals can easily top $2,500 a year or more – and there are additional associated costs.
If you’re a property owner, consider investing that money in a metal and steel marine storage. Your tax advisor might like the sound of that, too. It can increase your property value while it gets rid of the monthly slip payment and keeps things close to home. Check out our gallery of metal and steel marine storage solutions shared with us by our customers.