Proposed Vacation Tax Credit

Vacation tax credit

An Arizona Senator, Martha McSally, is hoping to reignite the tourism industry for the year 2020. They’re proposing a vacation tax credit that encourages Americans to travel within the United States.

The proposed bill is called the American TRIP Act. The acronym TRIP stands for “Tax Rebate and Incentive Program.” If passed, the bill would grant vacation tax credits up to $4,000 per American adult, or $8,000 per married couple, plus $500 for each dependent child. The tax credit could be applied to travel expenses such as transportation, lodging, food and beverage, and entertainment that occur between December 31, 2019 and January 1, 2022. However, you would be required to travel at least 50 miles from your primary residence and stay within the U.S. and its territories in order to qualify.

Of course, this isn’t the only vacation tax credit idea that’s currently being evaluated by policy makers. A few weeks ago, President Trump discussed the “Explore America Tax Credit”, which offers a different incentive. The Explore America Tax Credit offers up to $4,000 per U.S. household for vacation expenses spent in the U.S. at hotels, theme parks, restaurants and other tourism-related businesses through the end of 2021. This proposed tax credit would cover up to 50% of a family’s total vacation expenses, but the maximum amount is $4,000.

We’re waiting to see what kind of tourism-related tax credit, if any, gets approved by the government. So far both ideas are still in the infant stages of being considered. It’ll be worth watching to see what happens next since giving these proposed ideas would help our economy, too.

Source: Forbes

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Kevin Koszola