Tax Deductions

[swamper Junior Member Find all posts View Profile Close swamper]

Are there any tax deductions associated with timeshare ownership for the average timeshare owner?

swamper

[lawren2 Malibu Beach Barbie & A Super Moderator Find all posts View Profile Close lawren2]

Real Estate Taxes

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Mortgage interest is as well if it's a qualifying loan. See your accountant to know for sure.

Also, if you rent units, certain expenses such as maintenance fees are deductible against the rental income.

[swamper Junior Member Find all posts View Profile Close swamper]

Thanks for the information.

[vintner Super Moderator Find all posts View Profile Close vintner]

Mortgage interest is as well if it's a qualifying loan. See your accountant to know for sure.

Also, if you rent units, certain expenses such as maintenance fees are deductible against the rental income.

And since you have to 'visit' your property to inspect for rental, you may be able to have some trips or part of the trip as a deduction. As with any tax advice found on the web, consult with your tax adviser.

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

And since you have to 'visit' your property to inspect for rental, you may be able to have some trips or part of the trip as a deduction. As with any tax advice found on the web, consult with your tax adviser.

I wouldn't recommend trying that one. When I checked into it, the trip had to be strictly to check out the unit. Essentially fly out and back within a day. Otherwise you were on vacation according to the IRS. Even if you were just checking on your property, when it's a timeshare unit, it's going to throw up a red audit flag to the IRS. It's just not worth the risk IMO.

[vintner Super Moderator Find all posts View Profile Close vintner]

As I said, check with your tax adviser. Mine must look at the taxes differently than some others.

[dougp26364 Senior Member Find all posts View Profile Close dougp26364]

As I said, check with your tax adviser. Mine must look at the taxes differently than some others.

In my case it was the IRS that had the last word on the matter.

You're right, different "tax advisors" look at the rules differenty. About 7 years ago a "IRS certified" tax advisor gave me some monumentally bad advice. I trusted her as she had what appeared to be the credentials and she worked for a reputable tax filing firm. Her agency covered the interest and penalities but I still had to pay the taxes. What irritated me most was that she had to over ride the companies safty guards in the program to allow the deduction that she suggested.

It is very difficult to write off expenses associated with "examining" out of state property when it's a vacation ownership. You're on extremely thin ice if they decide to look at your records can go back many years if they pull an audit and decide to disallow the deduction. The snowball effect of years of questionable advice can be devistating if the IRS decides against you

If your tax advisor is telling you it's fine, I'd recommend contacting the IRS and have them send you the rules for such write offs. I fear you'll find it's almost impossible to qualify most expenses, including travel expenses, as a tax deduction for a timeshare.

You are pretty much limited to writing off the real estate taxes you pay, in some cases interest on your mortgage loan (but not all cases), and some expenses associtated with renting your timeshare. Past that it's really very thin ice.

edit:

I took a look at the online IRS FAQ' for writing off travel expenses. What I could find basically stated it had to be a provable business expense. I'm assuming that a few tax advisors will try to say that if you rent out your timeshare for any portion of your ownership you can travel to that timeshare location and write it off as a business expense.

However, a few years back when I looked into this with the IRS I was told that, in order to prove it as a business expense the trip had to be solely to inspect the property. Essentially no time spent doing anything else....fly out, inspect and fly back. Otherwise the auditors would look upon it as a pleasure trip which is not deductable.

It can be done but, in most cases, won't be allowed since the sole purpose of the trip must be to inspect the property. Remember, when it comes the the IRS they'll shoot first and ask questions later. I believe the burden of proof always lies with the individual when it comes to the IRS. If you can't reasonably prove it was a business trip to inspect owned property vs taking a vacation in which you just happen to own a timeshare the deduction won't be allowed and you'll owe taxes, penalties and interest at the very least. If the practice has gone on for years and you get a gun ho auditor that believes you're guilty of tax evasion (I would like to think of this as rare) you could be looking at a real fight on you hands. In any case if they find one questionable deduction get ready for them to whip out the microscope to question every little deduction you've ever made.

[BoardGirl Senior Member Find all posts View Profile Close BoardGirl]

I wouldn't try it. Given that you pay your annual fees to someone else to maintain and manage the property, "inspection" is hardly warranted and not justified.

[Nadonahoe Senior Member Find all posts View Profile Close Nadonahoe]

What If ...?

What if an owner was an officer of the homeowner's association governing body where he/she owns and rents a week. Would he/she be able to deduct travel costs for trips to periodic meetings of the governing group - sounds like it would qualify as active management of the resort where one owns the timeshare.

Just a thought - your opinions please. My accountant has worked with me for many years and says I have a good imagination !! However, in the past some of my wacky ideas were indeed backed up by a little tax law research and I was able to benefit from them. Noelle

[crwisconsin Senior Member Find all posts View Profile Close crwisconsin]

Are you being paid?

What if an owner was an officer of the homeowner's association governing body where he/she owns and rents a week. Would he/she be able to deduct travel costs for trips to periodic meetings of the governing group - sounds like it would qualify as active management of the resort where one owns the timeshare. Noelle

You are not donating time to a charity so that aspect is out. If you were being paid a salary on which taxes, etc., were being deducted, then you should be allowed to deduct expenses (probably up to the amount of your salary), but who gets paid a salary? I would guess that the HOA would pay expenses anyway, but perhaps not.
Charles

[swamper Junior Member Find all posts View Profile Close swamper]

Would a donation of a week’s accommodations to a charitable organization such as the “Make a Wish Foundation” be considered a tax-deductible charitable contribution?

[crwisconsin Senior Member Find all posts View Profile Close crwisconsin]

Would a donation of a week’s accommodations to a charitable organization such as the “Make a Wish Foundation” be considered a tax-deductible charitable contribution?

My understanding is that it would but I have never done it so I don't know what kind of documentation you need to claim the deduction.
Charles

[brother coony Senior Member Find all posts View Profile Close brother coony]

Would a donation of a week’s accommodations to a charitable organization such as the “Make a Wish Foundation” be considered a tax-deductible charitable contribution?

Yes upto the amount of Maintaince fee,