Canadian DVC tax question

[KCMA]

can any Canadian DVC members let me know if there is anything required at tax time? .. any special forms or declarations etc.. continuing my research before I finally pull the trigger


Thank you!

 

[keaster]

We have owned since 2011 and have not had to submit anything for tax time. I think if you sell your contract there is some tax paperwork for that.

I also think if you rent your points, you may have to indicate income on your taxes.

 

[dvcdisney]

I'm not aware of anything that can be submitted when you purchase DVC points.

I do know that if you sell your points, you need to file a specific US "tax form" to get the amount that is withheld.

 

[Greg36]

I don't think there is anything. Just what others have noted above--renting or selling would have tax implications...

 

[rspencer38]

What are the tax implications of renting your points?

 

[Greg36]

What are the tax implications of renting your points?

I am no tax expert, but it is income, so I believe it is supposed to be reported. I have read it should be reported to Canadian government as well as American government... I am guessing you could write off some expenses associated with DVC ownership, but any income is supposed to be reported...

 

[LauraLap]

I've been a member for 10 years and have not had to claim anything. However, I am selling my points now (my points are awaiting ROFR right now) and have been told the IRS will withhold 25% of the selling price initially, until they figure out capital gains. Then I have to file a claim to get the rest back which I have to pay more money for someone to help me with that. Ugh.

 

[kiford]

I am no tax expert, but it is income, so I believe it is supposed to be reported. I have read it should be reported to Canadian government as well as American government... I am guessing you could write off some expenses associated with DVC ownership, but any income is supposed to be reported...

Yes, it would be considered income. I think you should be able to claim expenses against it such as the annual fees and possibly interest charges if it's being financed. Very similar to owning an income property. However, I would suggest checking with a tax specialist or the CRA website under income properties. There may be an interpretation bulletin that might cover timeshares.

However, I am selling my points now (my points are awaiting ROFR right now) and have been told the IRS will withhold 25% of the selling price initially, until they figure out capital gains. Then I have to file a claim to get the rest back which I have to pay more money for someone to help me with that.

It's probably too late now, but if you have a US tax identification number (TIN) you might be able to file an exemption to the withholding or at least a reduction (although we've had mixed results on that front when selling non-real US property). You'll definitely need one to claim back later. And then prepare for them to lose your documentation at least once and then sit on it for a while. Or a long while. Or a really long while.