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Donít forget to promote sales tax deduction!

The current issue of SmartMoney magazine includes an article offering tax planning tips to readers. Under the heading ďStimulus Savings,Ē the author wrote: ďthe ĎCash for Clunkersí program may be over but consumers can still get a break on new vehicles.Ē Thatís true advice . . . but only half a loaf.

Regrettably, the article didnít include the fact that boat buyers also get a break. According to MRAAís lobbyist, Larry Innis, the tax break on boat purchases actually goes back to late 2004 when Congress included it in a stimulus bill called the ďAmerican Jobs Creation Act.Ē† The provision allowed for the deduction of state and local sales taxes and it was slated to sunset in 2005. But, Congress has renewed it several times so itís still current and will be through 2010.

Itís sort of an out-of-sight, out-of-mind thing. Because itís not a hot new policy, we can easily forget this is another valuable incentive for prospects to buy now. But, itís not getting emphasized in our sales presentations any more. In fact, Iíll guess many salesmen donít know it still exists.

With todayís buyers driven almost exclusively by price, promoting this potential tax break to prospective buyers, especially at our upcoming boat shows, certainly fits the times. But, while calling attention to the tax break, salesmen should not dispense tax advice. As with all IRS regs, there are qualifications. So, itís always best to tell customers to consult their tax preparer for appliance and details. Still, the fact is customers could get a tax break worth hundreds of dollars by buying a boat now.

Finally, I just got a promotional email this week from a dealer (Lakeside Marine) plugging the potential savings I could realize because of this tax deduction. Frankly, it reminded me (Iíd forgotten) that this tax break still exists and it prompted this blog. In addition, the e-mail also illustrated how one dealer is aggressively using every incentive idea available to reach out to customers and prospects.

Comments

9 comments on “Donít forget to promote sales tax deduction!

  1. Mike

    Norman,

    Do you know if this applies to new boats only or is it applicable to brokerage and used as well? Thanks for the input

  2. Comrade Karl

    Is this any boat???
    Why hasn’t this been highlighted previously?
    It should have baan a corner stone of the failed Growboating campaign
    Better late than never….

  3. Jack Hern

    How about an “IRA” ? Individual recreation account !!!!!!
    Lets not forget to also sell FAMILY FUN & it is not unusual to see three generations on a boat.

  4. kim stepp

    To Comrade Karl: OMG! How right you are! All the funds that we have had to pay to the “Grow Boating” funds and they never mentioned this!!???

    Thanks alot NMAA! You are right on top of things, as usual!

  5. Florence Harrington

    I can’t posibly agree with the above post, and would like to pick up on a few of the OP’s points. Not everyone will see your point of view and though I am one of them, I do respect your right to have your view. Either way I have enjoyed reading Dealer Outlook » Blog Archive » Don‚Äôt forget to promote sales tax deduction!.

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