People interested in becoming charter boat owners often come to us with a concern regarding meeting the requirements to quality for tax advantages for running their boat as a charter business. The number one objection from their CPAs is that the business yacht management program is a passive activity and will not be deemed active participation which is the key requirement for qualifying for small business and Section 179 tax deductions. Professional accountants often contend that a boat owner may find it difficult to prove active participation in a boat business.
However, in 2015, a couple who owned a boat charter business under a yacht management program won their case in Tax Court. See details in this article where they proved active participation validating the yacht charter ownership model that Catamaran Guru uses when advising boat buyers.
Contact us for more information on how to set up a yacht as a business in a legal and defensible way and what you need to know about record-keeping to help you prove your case if ever necessary.
4 thoughts on “Charter Boat Owners Win IRS Challenge”
I’d like to have a copy of the article…. thanks peg
Not that we will have this problem but I still would like to read what was written.
Thanks, John
I would like a copy of the article as well. Thanks!
Hi, all. This is Estelle of Catamaran Guru. Please call or email by clicking on the link at the end of the article if you wish to have more information on this important case. Also, I just wrote more details about several tax court cases you might want to check out: https://catamaranguru.com/section-179-tax-advantages-related-court-cases/.