Travel Trailer Depreciation

[grandmabee]

I have a temporary worker who purchased a used travel trailer for job site. What depreciation class/life would this be in?

anyone have this before?  thanks

[Lynn EA USTCP in Louisiana]

What is the purpose of the travel trailer?  If for an office, then I'd use the 39 years .  If for personal use, i.e. to sleep in at night and eat his meals after work, then no depreciation.  Caveat  - totally unresearched.

 

[Lee B]

I used to have a client who was a job foreman for a large construction company, maintained a permanent home in my state,

where he lived between jobs. I took depreciation on his travel trailer, don't remember how many years.

There is lots of case law in this area, that defines the line between permanent and temporary which allows the depreciation of a trailer trailer or a motor home.

[BHoffman]

I would use 7 years.  

[grandmabee]

He has a home residence but he is on an out of town temporary job.  Tired of staying and paying hotels so purchased a used RV trailer to use on job site area.  He pays space rent and I was going to depreciate the trailer.  He is planning on selling once done and will report sale also.

[Abby Normal]

I'd use Class 0.27 trailers 5 years.

Or my fallback, Class 57 Distributive services 5 years.

Most assets are 5 year except office furniture not used by customers.

[Abby Normal]

http://cs.thomsonreuters.com/ua/fixa/cs_us_en/ass_life_tbl/hid_help_asset_lives.htm#

[DANRVAN]

You might consider "Certain

On ‎03‎/‎06‎/‎2016 at 7:16 AM, Abby Normal said:

http://cs.thomsonreuters.com/ua/fixa/cs_us_en/ass_life_tbl/hid_help_asset_lives.htm#

Could be considered "Personal Property With No Class Life", which is assigned 7 years.

Also note that a trailer used for farm worker housing is 7 years (or 15 years with the wheels removed)  per pub 225.

[DANRVAN]

Since it is listed property, he should keep a record of business use vs. personal use.

[Max W]

I think this topic has run off the road. If it is personal use, which it seems to be, there is no depreciation.  By his own words, it was purchased to save money on hotels.  

[Gail in Virginia]

8 hours ago, Max W said:

I think this topic has run off the road. If it is personal use, which it seems to be, there is no depreciation.  By his own words, it was purchased to save money on hotels.  

But if the the hotel expenses would have been deductible, then I see no reason why the portion of the use of the mobile home that replaces the deductible hotel expense, should not be a business expenses.  But beware of the rules about temporary jobs vs establishing a tax home, and consider the consequences at the end of the temporary job if he converts the RV to personal use or sells it.

[Abby Normal]

I'm with you, Gail!

[DANRVAN]

10 hours ago, Max W said:

I think this topic has run off the road. If it is personal use, which it seems to be, there is no depreciation.  By his own words, it was purchased to save money on hotels.  

A deduction was allowed for that very reason in Austin Otology Associates v Commissioner (but for only one month). 

The deduction is allowable under section 162(a)(2). Substantiation is critical.