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.