Bipartisan Bill H.R. 7944 introduced

Representatives Blake Moore (R-UT) and Norma Torres (D-CA) have introduced bipartisan legislation, 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.

The Semi-Trailer Tax Parity Act (H.R. 7944) extends the floor plan interest financing deductibility provisions to truck trailers, semi-trailer chassis, and semi-trailer body dealership owners.

“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. 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.”

Gwendolyn Brown, President of the National Trailer Dealers Association (NTDA), added, “We are grateful for the leadership of Representatives Moore and Torres in introducing this bipartisan legislation. Achieving floor plan tax parity is critical to the sustainability and growth of semi-trailer dealerships.”

The NTDA’s Commercial Advocacy PAC also 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.

Background

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. (It is important to note that this classification applies solely within the context of the tax code.)

Lack of inclusion has resulted in reduced capital for inventory, strained cash flows, reduced inventory levels, and the potential to owe federal taxes for semi-trailer dealerships in years when they have incurred a loss or have no taxable income. This common-sense legislation supports and ensures fairness for our locally owned dealerships.