1098 on resale? Best use year for me?

[DanaHesson]

Is the financing for resale the same as for new purchase? i.e. is the interest considered mortgage interest and likely tax deductible? I REALLY want in! (however not at the prices being charged by disney!)

We also will be primarily traveling in the fall or in January. We were advised that an April use year would probably be good for us. I don't understand how it works well enough to figure this out on my own! We usually travel in sept, oct, or nov., but right now we don't have children. IF that changes, we will most likely change our habits. How do I determine how to select the best use year date for us?

 

[jberry5]

From my understanding of DVC, it would qualify as a home residence. People who have purchased and financed directly through Disney apparently do receive 1098s, I believe.

If that is in fact correct, then the interest from purchase through a resale, would not have to be on a 1098 to be deductible as mortgage interest. For example, many people will finance an RV or yacht and can claim that as a 2nd home if it has living quarters, i.e. bed, kitchen, bathroom, etc.

If not on a 1098, that simply means that the information was not provided to the IRS. In that case you still could claim the interest by providing information on whom you paid the interest to, including: their name, address and Social Security or Federal Identification number.

Now if your home is under mortgage, along with another home that you current deduct on your tax return, you can only claim mortgage interest on 2 of them.

With all that said though, I would discuss this with whomever prepares your tax returns.

 

[DanaHesson]

I prepare my tax returns. Have for years (well, I do them online anyway)

Any advice about the use year?

 

[crisi]

Financing through Disney is secured as mortgage interest. Its also usually tax deductible if you take out a home equity loan. As with all tax advice, consult your own tax professional. Financing through a timeshare reseller is usually NOT tax deductible as it isn't secured.

You want a use year that occurs right before you usually travel - if you travel in Fall, an August use year is good. The thing with use year is that if you travel in January with an April use year and have to cancel your trip - you'll need to take that trip before April or lose your points. If you had an August use year, you'd have most of the summer, AND your points would still be bankable if you cancelled 30 days out. However, peoples travel plans often change over the life of the contract - you may usually travel in Fall now, and switch to summer if you have kids who are in sports or something.

 

[jberry5]

Sorry, can't be of much help on the use year, as I too am just in the deciding mode of whether or not to purchase a DVC. From what I've seen most on here state though, all things being equal, it is nice to have a use year close to when you'd be traveling.

 

[jberry5]

These resale notes aren't secured by the purchaser's DVC or the purchaser's home? I would have assumed that to be the case. But yes, if these loans are not secured by the DVC itself or by your personal residence, then the interest would not be deductible.

 

[crisi]

These resale notes aren't secured by the purchaser's DVC or the purchaser's home? I would have assumed that to be the case. But yes, if these loans are not secured by the DVC itself or by your personal residence, then the interest would not be deductible.

With a resale, usually not. Around here, we usually recommend home equity loans if you need to finance a resale, its "most likely" tax deductible and the interest rate is usually pretty decent.