| Boone & Crockett - 1/27/2024 07:36 I suspect Kirks kid has a point here if the IRS wants to do some in depth, forensic accounting. Depends on how much ambition the auditor has. I would not count on saving the interest deduction for my new 40’ Donzi with twin supercharged 504’s I threw on the LOC in an audit. Bet he/she would change that uncaring attitude right quick. In his defense,The now unemployed offensive coordinator catches a lot of grief on this site, but he’s not always wrong.
I probably wouldn't take tax advice from a banker, but I certainly wouldn't take it from an unemployed OC or anyone pretending to be one on the internet.
Unless you are borrowing the money in the farm account and writing a check from the farm account for the boat how are they going to prove that is what the money was borrowed for?
In most cases it would work like this, farmer borrows money on his Corp LOC then writes a check from his corp to his personal account. Then uses the money from his personal account to buy the boat. In which case, the money is borrowed from the Corp LOC did not buy the boat, it paid wages or a distribution to the owner. Both of which are completely legal to deduct interest for.
Basically it goes back to the old saying that "nothing is paid for until its all paid for".
Now, if you borrowed money for the boat and are writing the check to Al's Boat Emporium out of the Corp checking account, you probably better have consulted your CPA and have your ducks in a row.
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Save on operating interest or invest in mutual funds?
