Early Saturday morning, the Senate passed its tax reform bill on a 51-49 vote. The Senate and House must now appoint members to a conference committee to reconcile the different versions of the tax bills. The intent of the House and Senate leadership is still to try to have a final bill to the president before the end of the year.
Although both bills have a lot in common, namely the drastic cutting of the corporate tax rate, elimination of a number of personal deductions and changes to the estate tax, the bills also have many critical differences that will have to be ironed out before the bill can make it to the president’s desk.
Of critical interest to the RV industry:
- The Senate bill makes no changes to the current mortgage interest deduction. RVIA had previously contacted Senators to urge that the mortgage interest deduction continue to be available on second homes, including RVs. The House bill would limit the deduction to interest of only $500,000 and restrict it to only the primary residence.
- Another important amendment to the Senate bill, which was added as part of the final managers’ amendment, would allow all floorplan interest to continue to be deducted as a business expense, rather than capping it to only allow the first 30 percent of interest expense to be deducted as the original Senate bill would have done. This is a critical benefit to RV dealers and both the House and Senate versions would now allow full deductibility of floor plan interest expenses.
RVIA said it will continue to work to ensure that provisions of importance to the industry will be preserved in any final bill which is brought back before the Congress and sent to the president.
Click here to see a summary of House and Senate tax reform provisions.