How Can I Deduct Rental Car Costs On My Income Tax?

One of the popular questions asked related to tax is “Can I deduct rental car costs on my income tax?”. Many countries impose massive taxes on rental cars. Rental car companies are becoming more infuriated with the increasing taxes imposed on their clients.

Unfortunately, it is not easy to avoid these taxes, according to the Coalition Against Discriminatory Car Rental Excise Taxes. In 43 of the United States of America, there are a total of 114 different local and state excise taxes for leasing and or renting cars. In the 1990s, there were only fourteen such taxes. The CADCRET was formed in order to track and fight the proliferation of taxes.

Residents of Maine blocked a new state tax-reform law that proposed a 10-12,5% increase in car rentals. The petition managed to put the increase on hold for a while at least. This is a great relief for business travelers in particular as well as rental car companies and corporate travel departments.

Some cities charge as much as 20% in car rental taxes and cost Fortune 100 companies upwards of $5 million per year.

Taxes are imposed in order for cities to close gaps within their budgets. This has not made the car hire companies excited at all. They do not want to be associated with tax collection and they have to charge higher prices to accommodate the taxes. Subconsciously clients blame the care and truck rental companies for this. 36 months ago 8 rental brands and the National Business Travel Association formed a group to lobby against the taxes. They also took it upon themselves to provide education for consumers.

In New Jersey there is tax reform passed that permits municipalities to impose 5 % excise tax when people rent cars. As it is car renters already pay a whopping $5 daily in the form of sales tax and state tax.

Don’t rent a car in Wisconsin as you will be expected to pay $18 every time you rent a vehicle. The money from this tax is supposedly used to assist in the funding of a mass- transit project. This would translate to a tax increase of in excess of seventy percent in Milwaukee, Kenosha and Racine.

The lobbyist group also reports that in Michigan there is pending legislation that will, if passed increase taxes by a further $2.50 per transaction.

In order to find funding for rail projects in Florida. The people responsible for the law are fighting to increase the taxes by a further $2.00. This would mean the tax increases by 50!

The general consensus of these people who make the laws is that this tax is necessary and understandable. These sentiments receive fierce opposition for the coalition.

The recession has hit the states in America in a big way and the deficits in state coffers is horrendous to say the least.

It appears there is misappropriation of funds as when a project is complete then the money is used elsewhere. This explains some of the reasons that car renters are asking, “can I deduct car rental costs on my income tax?

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What If You Forget to Buy Travel Insurance?

For many people, acquiring travel insurance is not on their list of things-to-do when making their travel preparations. What most travelers do not realize is that there are many events that can happen on a vacation that can result in serious financial loss.

Before traveling abroad, it is important to consider the reasons why you should not forget to buy travel insurance:

Personal Injury: When planning to travel in another country, you should think about what would happen if you were in accident and needed medical treatment. Depending on the severity of the injury, medical costs could run from hundreds to thousands of dollars. Buying travel insurance before your trip will ensure that if you need medical treatment, your costs will be covered. Personal accident coverage can also cover you in the event of death or if you are permanently disabled. Some policies will pay your legal costs if you decide to sue a third party for damages as a result of personal injury or death.

Unexpected Cancellation: After booking and paying for a trip, many people do not think about the money they will lose if they had to suddenly cancel. This could be due to an illness or death in your family, jury service, fire, or flood or storm damage to your home or business. The financial loss could be enormous. Travel insurance will cover your costs if you have to cancel your trip.

Missed Departure: On the way to the airport, most people do not consider how much money they would lose if they missed their flight. This could be the result of weather conditions, vehicle breaking down, etc. With travel insurance, you will be covered in the event of a missed flight. You may also receive a lump sum if there is a valid reason why your departure was delayed or you missed your flight.

Lost or Delayed Luggage: When traveling by plane, many people have had their luggage either delayed or lost. Replacing clothes and incidentals can be quite costly. Travel Insurance will cover lost luggage items. If delayed, the policy will cover the purchase of necessities that you require while waiting for your luggage to arrive.

Cause Injury to another Person: If you have rented a car while traveling abroad and crash into another car, and are found at fault, you may be responsible for paying for another person’s medical costs. Personal liability insurance will cover you for another person’s loss. Some policies will pay for the cost of an attorney if you are sued.

Lost Belongings and Theft: When you are traveling abroad, you should consider what you would do if you lost your belongings or had them stolen. Losing you cash, credit cards, and other forms of payment could leave you in a frightening situation. Traveler’s insurance will cover you if you lost or had your means of payment stolen. If you take expensive items such as jewelry and cameras on your trip, you run the risk of having the items stolen. Travelers insurance will cover you in the event of a theft of an item. Most policies impose a limit of coverage on any one item. You should consider adding ‘all risks’ coverage to your valuables. As well, make sure that you become familiar with any stipulations in your travel policy regarding the loss of an item. If you left a camera at a public place such as a park, you may not be covered

Traveling abroad can be an exciting and fun adventure. When making your traveling preparations, you want to make sure that your plans will result in a relaxing and enjoyable trip. Purchasing travelers insurance will give you peace of mind knowing that you are protected.