Is Keeping A Home Base Worth The Cost And Effort?

Often, a fulltime RVer will ask me about purchasing a brick and stick home just for the purpose of being able to claim the “away from home” expenses. The expenses that they want to deduct are the expenses they must incur because their seasonal jobs require them to travel, in their RV, to another location, that is at least 100+miles away. These expenses are the campsite rent, utilities, and meals while they are away from their brick/stick home. This does not include the transportation costs to get to the job site. Those are deductable in either case. In order to qualify for the away-from-home expenses, the taxpayer must have a home base that is either purchased or rented. It is these costs that must be duplicated. Not only must a home be maintained, but also the taxpayer must return periodically and must perform some of the same type of work while there. The additional costs associated with a home base are the real estate taxes, insurance, the rent or the capital invested in the house. The mortgage interest and the taxes are deductable items as Itemized Deductions on Sch A but only if you have sufficient such deductions that are more than the Standard Deduction: $12,200-14600 for married taxpayers or $6,100-7600 for singles taxpayers. Even if you have enough Itemized Deductions, the interest and taxes will only save you 15-25% of the costs. For each $1,000 of interest and taxes spent, you’ll save only $150-250 in taxes, depending upon your income level. The cost of insurance and maintenance of the house is not going to be deductable, and the away-from-home will only save you the same percentage and ratio.
However, if you want to keep a home base in order to tend to a seasonal garden; have a place to spread out your trophies, or works of art or other treasured heirlooms; or if you need a location to set up an immobile shop, then by all means set up or keep the home base and take full advantage of the away-from-home deductions you may then be entitled to. But do it because of these secondary needs, not just for the deduction of the away-from-home expenses. Remember, that a tax deduction will not save you in taxes near the amount of the expenditure to begin with.