Start offsetting the cost of your new yacht by Chartering her!
This is how it works. If you're willing to share your yacht, you will get substantial tax savings (a large tax deduction this year!) AND you will get an additional steady income from chartering her!
If you are at the top end of the tax table, and if you have (or are anticipating) a big increase in income this year and if you plan to purchase a new boat (and have a marginal tax bracket that would justify a large write off–25% or greater-combined federal/State), you could get the $500,000. Section 179 deduction.
The section 179 deduction of 2009 Increased the Code Sec. $128,000 expense limit to $500,000 and boosted the overall investment limit from $510,000 to $800,000; and allowed a bonus first-year depreciation deduction of 50% of the adjusted basis of qualified property.
How Does It Work?
Ideally, if you can acquire a boat for most of the boating season, you can qualify for a full year of tax advantages and at the same time, get income to cover cash flow the year you place the boat in service. Typically, you will have to set up a LLC or other pass through entity and the tax advantages directly offset taxable income from any active source, including your regular job (W2 income). You do not wait until the end of the year. Please contact your tax advisor for more information or feel free to contact us. If we're not available immediately, we will contact you back as soon as possible.