CONSERVATION CORNER
The Tax Advantages of Owning A Boat
by James L. Cummins

Owning a boat is a way of life for many Mississippians. Nation wide, there are 13 million boats; there are 270,868 boats in Mississippi. Boaters spend $25,000,000,000 on boating.

The Mississippi Fish and Wildlife Foundation, or Wildlife Mississippi as it is commonly called, wants boaters to know that as long as your boat or vessel meets the criteria for a second home, the Internal Revenue Service (IRS) can provide a deduction for you. Here is how it works.

For tax purposes, many boats qualify as second homes just like land based vacation condos and mobile homes. If you have a secured loan on that vessel, the IRS allows a tax deduction on the interest paid on the loan.

The IRS defines a second home as having "basic living accommodations such as sleeping space, toilet and cooking facilities." A secured loan is one where a lending institution holds the boat as collateral for the loan.

Interest paid on the qualified loan should be reported on the federal income tax return Form 1040, Schedule A, Itemized Deductions. Boat owners who received a 1098 form from their lender should enter the amount of interest paid on line 10. If they did not receive a 1098 form, they should enter the amount on line 11 and provide the lender’s name, address and tax identification number.For more specific tax information, boat owners should consult their own financial or tax advisors or visit the IRS Web site at http://www.irs.gov. IRS Publication 936 also covers rules for interest deductions.

This information was provided by BoatU.S., the nation’s leading advocate for recreational boaters. It provides its 550,000 members with a wide array of consumer services including a group rate marine insurance program that provides over $8 billion in hull coverage; the largest fleet of more than 500 towing assistance vessels; discounts on fuel, slips, and repairs at over 700 Cooperating Marinas; boat financing; and a subscription to BoatU.S. Magazine, the most widely read boating publication in the U.S. For membership information visit http://www.BoatUS.com or call (800) 395 2628.

James L. Cummins is Executive Director of the Mississippi Fish and Wildlife Foundation in Stoneville, Mississippi. Known as "Wildlife Mississippi," the Foundation is a non-profit, conservation organization founded to conserve, restore and enhance fish, wildlife and plant resources throughout Mississippi. Their web site is www.wildlifemiss.org.