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 | David
Join Date: Posts: 1 
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1999-10-12 8718
I am taking a home equity loan to buy a compact tractor and am hoping to find a good used New Holland compact. the question is Is a tractor and item you can spend money from a loan on and still get the tax deduction? After all its primary goal will be to improve the property landscaping etc. Any Tax experts please comment thanks in advance David
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| MichaelSnyder
Join Date: Jun 1999 Posts: 0
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1999-10-12 8719
David,I'm surely not an expert by any means. But I can tell you that my parents have used and will be using a home equity loan to buy a new car(s), and they are able to tax deduct the interest. Knowing my parents do everything by the book, I feel pretty secure about it. To my knowledge, you don't have to itemize or list what or where you spend the money, therefore it doesn't matter if its for a NH or a skylight in your living room. ....
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| mike
Join Date: Posts: 1
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1999-10-12 8721
David, Yes, It is tax-deductable. A smart way to finance a large ticket item like a tractor. The loan must be secured by the Deed of Trust. Make your payments or your house is history. I'm not sure but the interest rate may be higher than what the tractor companys offer?? But you can at least right off Interest. So which way do you save money?? ....
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| MichaelSnyder
Join Date: Jun 1999 Posts: 0
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1999-10-13 8741
David,Again, only my observations, I have only RARELY seen a manu'f company like JD,NH or any other company offer a rate even comparable to a home equity. That is of course the company is doing a marketing strategy which includes things like 0% interest for 1 year or so. Either way, I think you'll be hard pressed to beat a H.E. Loan. Short of refinancing your house mortgage to include the tractor. Just my 2 cents:) ....
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| Dean
Join Date: Jul 2003 Posts: 13 Avella Pa
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1999-10-13 8772
David,You need to do the figures, just the same as you would with any loan comparison.The value of such a loan, altho' a tax deduction, is in the effective loan rate. That rate is based upon the your gross income, and the effect that the loan would have on offsetting the tax rate that you would pay. In the proper tax bracket, you could affect the loan rate by as much as 1.5%. Keep in mind that the rate declines as the the principle of the loan declines.One other issue that may help you to determine your loan placement is the amount of faith that you have in your dealer (if purchasing new). You will carry considerably more leverage with that dealer in getting your tractor repaired, if the company carries your loan, at least during the warranty period.The bottom line is that numerous factors could affect your borrowing decision, which include the amount of $ that you intend to borrow, loan rates, your relationship with your lending institution, with the dealer, tax position, etc.I would suggest doing all of the figures, unless the lending rate is, as stated in a previous reply extremely low from the manufacturer. Good Luck.b27 ....
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| Mike
Join Date: Posts: 1
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1999-10-16 8824
What ever happened to the idea of paying cash for something?You will always get the best deal on anything,if you have the cash in hand.Anytime you borrow money,even if you can write off the interest,you lose money, period. ....
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| mike t.
Join Date: Posts: 1
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1999-10-16 8834
paying cash for big-ticket items is a thing of the past nowdays. The poor man just does'nt have the cash for these items so he normally finances. The rich man knows his cash is better off invested elsewhere stocks, bonds real estate etc. so he better off financing or leasing for a right-off. ....
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| Craig
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2000-05-11 16190
Well, they are offering 12 mo 0%... ....
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