Legislation seeks financial relief for semi-trailer dealerships Amid Market Challenges
Key Highlights
- The bill expands access to floor plan financing interest deductions to semi-trailer dealerships, currently limited under federal tax law.
- It defines truck trailers, semi-trailer chassis, and semi-trailer bodies as 'motor vehicles' under IRC Section 163(j), enabling full interest deduction benefits.
- Industry advocates highlight that the legislation will provide financial stability and promote growth for semi-trailer dealerships nationwide.
- Lawmakers and industry leaders emphasize the importance of fair tax treatment to support the transportation sector and economic vitality.
- The NTDA and other stakeholders encourage continued engagement to ensure the bill's passage and implementation.
A new bill in Congress could provide trailer dealers some much needed financial relief during the lingered market downturn.
Representatives Blake Moore (R-UT) and Norma Torres (D-CA) have introduced bipartisan legislation, Semi-Trailer Tax Parity Act (H.R. 7944), aimed at expanding access to floor plan financing interest deductions for semi-trailer dealers.
Under current federal tax law, dealerships that sell motor vehicles, recreational trailers, and campers are permitted to fully deduct interest paid on floor plan financing. However, this provision does not extend to semi-trailer dealerships, placing them at a competitive disadvantage despite similar business models and reliance on inventory financing, according to the National Trailer Dealers Association, which spearheaded the push for a more fair tax plan.
Specifically, under IRC Section 163(j), businesses can generally deduct business interest expenses from their federal taxes by up to 30% of their adjusted taxable income. Because floor plan financing has unique needs, Congress enacted exclusions for motor vehicles, recreational trailers, and campers, allowing dealerships to fully deduct interest paid on floor plan financing.
The Semi-Trailer Tax Parity Act includes truck trailers, semi-trailer chassis, and semi-trailer bodies in the definition of “motor vehicle” under the 163(j) section of the tax code.
The NTDA’s Commercial Advocacy PAC recognized the efforts of its Dealer and Allied members, whose outreach to lawmakers—through calls, letters, and in-person meetings— played a key role in advancing the bill. The association now encourages continued engagement to support passage of H.R. 7944.
“Our federal tax code should support small businesses and incentivize reinvestment,” said Rep. Moore. “Semi-trailers are essential to nearly every sector of the economy, transporting everything from consumer goods to life-saving medicines. This legislation ensures semi-trailer dealers receive the same tax treatment as other vehicle dealerships.”
Rep. Torres emphasized the regional and national importance of the industry.
“Semi-trailers are critical to moving goods throughout the Inland Empire and across the country," Torres said. "Yet these dealerships face unequal tax treatment, creating financial strain and limiting options for customers. I’m proud to co-lead this effort to ensure fairness nationwide.”
Industry leaders echoed support for the legislation.
“We appreciate Representatives Moore and Torres for advancing this important bill,” said Paul Christenson of North American Trailer (Salt Lake City, UT). “Under current law, semi-trailer dealers can face tax liability even in unprofitable years. This legislation will provide much-needed relief and parity.”
NTDA President likewise thanked the sponsors of the bipartisan effort.
"Achieving floor plan tax parity is critical to the sustainability and growth of semi-trailer dealerships,” Brown said.