Side hustle questions about a travel trailer

I’ve been looking for a side biz in retirement, not a money maker but something that helps me write off costs of a hobby.

I’ve decided to pick up a small travel trailer that can be towed by a midsized truck or large SUV. It’ll cost about 22k and my storage expense will be about $90 per month, no idea what insurance will cost. I’d make a real effort to rent it out on outdoorsy or rvshare and of course use it for hiking and mtb trips.

I’m wondering if I can write the expense of the trailer off on 2022 taxes and cliff notes on how depreciation works. Im not looking to make money, mainly to cover my storage and insurance expenses. If it goes well I suppose I’d pick up another trailer or two with the sole purpose of renting them out.

Looking for advice and whether a sole proprietorship is good enough and at what point would I form a LLC.

Withholding comment on the wisdom of your endeavor, the first thing you should do before purchase is form an LLC (likely an S Corp). That’s the form where income and expenses flow through to you and the corp is generally not taxed. See IRS Schedule , Part 2. Here’s brief explanation.

All of your business should be conducted in the business name and all finances should be done in the business name, including separate banking accounts and purchases. Prior to any rental, look at what form of liability insurance you can get and get it. Any damage caused by the trailer, even by a dumb driver, and you can be liable as owner.

You can deduct expenses in a start up year, so long as you attempt to generate revenue.

There’s probably a hundred or so other things, but that can get you going.

A guy at work tried that, for him it was a huge pain in the ass. There were a lot of maintenance issues and he didn’t rent it out as much as he thought he would. Definitely do your research.

This is why I would not rent mine out. People that are inexperienced with towing are a ticking time bomb while towing a camper.

I follow a group called “Twisted Campers” on facebook. It is all about people getting in wrecks while pulling campers. People pull them through fast food drive throughs, low over passes, tree limbs, jack knife them while backing, towing too fast and losing control… I was camping and a guy rolls in with $80K truck and easily $60K fifth wheel. I try and mind my own business but this guy was struggling to back his rig into the spot. I yelled at him to stop as he nearly ran his truck into a tree while backing. He thanked me and said, he just got his camper out of the shop for roof replacement that cost $15K because he backed it into a tree limb.

Also campers are built cheap and low quality. They use lightweight materials to make them towable but these lightweight materials are often not durable.

I suspect that the camper market is about to take a massive dump with the high gas prices. This would likely put more people in the rental market and potentially drive prices down.

I’d also say if you are going to rent, I would not plan on using it yourself. One accident and then the camper is in the shop 6+ months and your summer plans to use it are shot. I am using mine this weekend for 3 year old birthday party at the lake/waterpark. $250 in camping fees, $250 in day use passes for guests, $100 in gas, $100 in food and drink.

I’m lucky that I don’t have to pay to store mine. I added two full hookups at my house. One on each side of the house. Weekend after next is powwow and a bunch of people are coming over. Some family is going to stay in our camper with full hookup and another family member is bring their RV to hookup at my house. My power bill is going to be out of this world running all the AC’s.

When they rent I’m covered up to 1M, there are different deductibles depending upon what level coverage they pay for. This is on outdoorsy at least.

How difficult is it to set up a S corp? Is it DIY or should I bring in a law firm that I trust completely?

The problem is when the refrigerator or hot water heater breaks or the renters can’t figure it out.

This will be either a new or year old so that shouldn’t happen. I’d give them a full walkthru and this is a 23ft trailer, not a lot to it. I’d probably put on the listing that I reserve the right to refuse based upon tow vehicle or dumbassery of the customer.

The only reason I’m thinking about this is because I’ve got a friend with a Class A and he’s paying the note and maintenance on it by renting. I wouldn’t need to rent out what I’m buying but I hate paying to store and this would offset that.

But yes, I imagine I’ll be on call 24 hours whenever a renter has it.

There are endless complaints about 2020-current models. They were slapped together with whatever materials were available

I’m not sure what rentals cost but if you could make even a couple hundred a week it might be worth it. If it sucks you can write it off as a lesson learned and just enjoy your new camper.

Around me I’d get about $115-135 a night, probably put a 3nt minimum. There are various fees I could attach, pet fee or cleaning fee. I wouldn’t do that, instead I’ll do a $500 refundable deposit that I’ll take if excessive pet hair it looks like a bomb went off inside.

It is relatively simple in most states. Georgia’s rules:

There are a number of law firm web sites discussing this also. You should be able to do it yourself.

Have you already bought one? If not, I would hold off a few more months. I bet you can get a fire sale on them after labor day. What make and model are you planning to buy? Have you owned one before?

Winnebago is cutting back production and expects a 20% decline in sales. The high gas prices are going to CRUSH the value of these things and there is going to be a flood of used ones on the market that will depress the prices of new units.

I’m looking at this one.

New they are about 26k, this one I wouldn’t pay more than 20k for. Or maybe give me a price to offer? I emailed the owner, they said it’s in new condition and that the friends they camped with moved away, they don’t plan to use it anymore.

I went to a dealer with a new one and a couple others I’d consider, a mild hard sales pitch but nothing I couldn’t deal with. The more I think about it, the more I may just rent one on rvshare the handful of times I’d use it. Think I got enamored with the concept of monetizing a hobby but as with most things in life, it’s not as easy as it seems.

That is really only for a couple. It might advertise sleeps more with the fold down couch but those are really misleading. The issue with this little one is there is virtually zero storage space. I have similar storage issues in my 31’ trailer.

Prior to pandemic, this camper at 1 year old price would have been about $13-15K because new would have only been about $17-20K. This one will probably hold its value longer then the bigger ones while gas prices are high. I bought mine used in late 2020 for $16.5K. NADA at the time was $16.9 (average retail). Today it is $28.5. This time next year I would not be surprised if it is not $10-12K. My parents bought their massive rig 3 years old in 2008. It originally sold for $70K and my parents bought it for $17.5K. High gas prices and recession crushed the market.

Issues with the single wheel unit is going to be more sway while towing than the double axle units. Even though it is lighter weight, it will still have a large frontal area and will act like dragging a parachute behind your truck and your gas mileage is still going to suck balls.

Those are all real issues, think I will rent one to see if it’s a lifestyle I can get into. I’m retiring soon and want to travel and ride all over the US, figure I’d give this a try at least. My son just got an airline job so I can fly free but bringing a bike while nonrevving can be a pain.

Other things to consider.

Fresh water, gray tank, and black tank size. Not all campground have full hookups so you might not have enough capacity to stay long at several federal parks. One of my favorites only has power. I have to fill my 30 gallon water tank and conserve water if im staying several days. Otherwise you either have to haul water or poop or break camp and go to dump station.

There is limited storage for clothes and gear. You have to stay very organized otherwise its chaos. Mine doesnt even have dedicated spot for a trash can.

The gvwr is only 5k and that only leaves you about 800# until your overweight. Sounds like a lot but when you add food, drink, camp gear, cookware, clothes, shoes, bike, bedding, towels, etc you will easily exceed it.

Until I retire, I can’t imagine staying longer than 3 days in one spot. Once I retire I’ll do a 30+ day trip but I’ll be on the move, not staying anywhere longer than 2 days.

@BMWMTBer Here is what a Wolf Pup looks like when opened up. I am not sure what that tow vehicle is, but clearly it was from inexperienced driver and likely inadequate towing capacity. What some people will do incorrectly is to load the trailer too heavy in the rear to help lessen the hitch weight to compensate for too small tow vehicle. This can happen by accident or intentional. Either way, it is a recipe for disaster while towing. This picture is why, I would never rent out my trailer to someone else. Most people have little to no experience with towing trailers. It’s not something you want to use your equipment as a learning experience. IMO, if you want to tow a trailer, you should be required to have a special endorsement on your driver license similar to getting a motorcycle license.

We have been bouncing around the idea of getting a camper to tow.
We pretty much put it off for a while when I sold my Jeep Wrangler and bought the Cherokee because of the towing capacity.

My advise is the tow limits is really limits of the driver. If a vehicle has a tow rating of 10K pounds, that will work for someone that has extensive towing experience. I own 6 trailers and tow all the time. I have different size trucks for different jobs.

No towing experience = 50% tow vehicle rating
Some experience = 70% tow vehicle rating
Lots of experience = 90-100% tow vehicle rating.

Even though I have lots of experience, I still don’t like to go past about 90% of tow vehicle rating. For me it is more of the wear and tear on the vehicle. My F350 is rated to tow 16K pounds. My camper weighs about 7K fully loaded. When I tow it with my F350, I simply can’t really feel the weight behind the truck. It is a easy tow and I don’t have to worry as much since my margin of error is much greater than if I was at max towing.

The other thing is the frontal area of the trailer will cause more issues than the weight of the trailer. You are effectively towing a parachute behind you. This will cause extensive stress on the transmission and other drive train components.

If you decide to buy a camper, don’t let the salesman tell you that you can tow this camper with your vehicle. Many people don’t know but the salesman will tell you anything to get his commission. They buy the camper that is too much (technically within specs) but puts you at maximum for the vehicle then they all kinds of issues. The vehicle doesn’t tow well. It’s too slow, too unstable, hard to maintain lane due to wind, etc. Years ago, I had a neighbor that bought a camper that maxed out his half ton. When you load it up with food, bedding, clothes, drinks, gear, etc you will pack on the pounds. He took off on family trip out west. It was too much for his half ton chevy and he overheated, blew his head gaskets, and warped his heads. They spent their entire trip at the repair shop and were out thousands in repairs just to get home.