RV as an Depreciated Asset vs Home office Deduction

[Msgtfry]

We are contract RV Park Managers paid via 1099.  The job description says we remain onsite in our RV.  Should the RV be treated as an asset?  Last year, our first, we treated as a home office.  

[RobertG]

You should continue to treat it as a home office.

In treating it as a home office, you are treating the business portion of your home as an asset.  

You can't deduct the entire value of your home, because the portion used for business has to be:

• Used regularly and exclusively for your business, and
• Be your principal place of business (both conditions must apply).

For further information please see the TurboTax website: Can I take the home office deduction?

[Rick_S]

We travel from RV park to RV park, staying for 2 weeks, and doing marketing for the RV parks & resorts.

1099 through the company I am contracted with. I am self-employed and pay for all of my own expenses, with the exception of the free site that is given for 2 weeks at each park. My wife is self-employed with her medical billing business (also 1099 contracted employee). Our fifth wheel is our main and only residence all year.

How would I enter expenses for our fifth wheel? Home deduction for both businesses, or take the fifth wheel as a business expense for my business, and depreciate? Ours is a rare circumstance, and I can't find any info on how to proceed with our taxes.

[ColeenD3]

There are drawbacks to both methods since, as you say, it is an unusual situation. The drawback to two home offices is the lack of space. You would need two separate areas, both exclusive business use.

You might have better luck as an asset for your business since it is a requirement for going to the parks.

[Rick_S]

I am wondering if I should just depreciate over 5 years as a business property asset deduction. We will probably trade in after 5-7 years. Home office seems touchy for RVers.  Any suggestions?

[Carl]

Just keep in mind that when you sell a deprecable asset you are required to recapture all depreciation on that asset in the year you sell it, and pay taxes on it. That recaptured depreciation adds to your AGI and has the potential to put you in the next higher tax bracket.

When it comes to what I"m required to do by law (or can legally get away with without breaking any laws) I'm going to do that which requires me to take the least amount of depreciation possible. That way in the year I sell the asset, the less depreciation I am forced to recapture, the better.

[Rick_S]

I will be trading in the fifth wheel and will commence depreciation on the new unit. With that being said, it should act as a continuance of a depreciable asset. I am sure I will end up with a loss on the trade-in.