Do you write off any DVC expenses?

[moredisneyplease]

I had a friend recently tell me that I should be writing off trips to WDW because I'm "visiting a second property" Sounds too good to be true! Also, what about writing off HOA dues? Is this something any of you do?

 

[JaxFLBear]

You may be able to deduct the property taxes. Check with a tax professional to verify.

 

[crisi]

Its too good to be true. You may be able to write off property taxes and interests costs, but you should consult your own tax professional.

 

[dcamdad]

I had a friend recently tell me that I should be writing off trips to WDW because I'm "visiting a second property" Sounds too good to be true! Also, what about writing off HOA dues? Is this something any of you do?

Please keep us posted. I would love to be able to deduct vacation expenses, and considering the amount I dropped at WDW over Christmas it might actually get me out of oweing this year.

 

[Dean]

You can deduct property taxes and MAY be able to deduct interest as a second home in some cases, all from federal returns. Whether one can deduct anything from state returns will vary state by state. If one is subject to AMT or doesn't have enough deductions to override the standard deductions, it will likely make no difference on your return. The only other situation where one could deduct would be if one bought solely to rent, essentially never used it and treated it as a business venture. In some cases a business that ONLY used it for clients might also be able to deduct more as well. Other than the property taxes for federal returns, it would be necessary to investigate further usually best done by checking with a tax professional.

 

[DW-Admin]

my father is a CPA and tax manager for his company and has verified that this CAN be done and it will be deducted...

believe me if you will, but i know i am deducting it

 

[Mtnman44]

I think there is a better discussion of this issue in this thread:
http://www.timeshareforums.com/forums/bluegreen-resorts/58520-tax-deductions.html

my father is a CPA and tax manager for his company and has verified that this CAN be done and it will be deducted...

believe me if you will, but i know i am deducting it

 

[Dean]

I think there is a better discussion of this issue in this thread:
http://www.timeshareforums.com/forums/bluegreen-resorts/58520-tax-deductions.html

To be honest, that is not a very good thread on the subject, I've seen much better on TUG in the past. There is some misinformation in that one can never deduct the donation of the use of a timeshare, only the ownership itself up to fair market value, usually much less than paid for it. And while it'd be possible to deduct a "visit" to a timeshare or rental property, it is almost impossible to justify under the IRS rules. Here is an advice column from TUG that is much better and FAR more accurate. TUG advice column

 

[Dean]

my father is a CPA and tax manager for his company and has verified that this CAN be done and it will be deducted...

believe me if you will, but i know i am deducting it

One thing to be careful about with taxes and lawyers in Timesharing, unless they know about timeshares, they don't know about timeshares. One cannot simply extrapolate from rental property or other RE rules regarding timeshares.

 

[tjkraz]

my father is a CPA and tax manager for his company and has verified that this CAN be done and it will be deducted...

believe me if you will, but i know i am deducting it

I'd love to hear the basis for that. Ask him to name the section of the tax code which would permit a deduction.

I think there is a better discussion of this issue in this thread:
http://www.timeshareforums.com/forums/bluegreen-resorts/58520-tax-deductions.html

That's not a bad discussion. However for the benefit of anyone reading, the closing comments which suggest that you can take a deduction for donating time to a charity is incorrect.

According to Publication 526, donating a small portion of your vacation home ownership (a certain number of DVC points, one year's use, etc.) is not considered eligible for a deduction. It falls under the "Partial Interest" clause.

Generally speaking, the only way you can legally take a deduction is if you donate the entire ownership to the charity. In the case of DVC, the entire contract would have to be given to the charity in order for the former owner to claim a deduction.

 

[DW-Admin]

I'd love to hear the basis for that. Ask him to name the section of the tax code which would permit a deduction.

I will check on that for you and get an answer...

 

[DW-Admin]

Father isn't home at the moment so I don't have that EXACT answer but here's an interesting article I found...

Interest paid on a loan to buy a timeshare week is often deductible. The tax law allows deductions for most interest expense that an individual pays on a primary home and one other home, such as a timeshare or other vacation home.

If you have loans on more than two eligible homes, you may choose which two homes (one of which must be your primary home) you will treat as qualifying for interest deduction purposes. You may change your choice of qualifying properties from year to year.

Interest paid on a loan to buy a timeshare week is often deductible. The tax law allows deductions for most interest expense that an individual pays on a primary home and one other home, such as a timeshare or other vacation home.

If you have loans on more than two eligible homes, you may choose which two homes (one of which must be your primary home) you will treat as qualifying for interest deduction purposes. You may change your choice of qualifying properties from year to year.

Example: If you have a primary home, a vacation home, and a timeshare week, you may deduct interest expense related to your primary home. In addition, you may deduct interest expense on only one of the other two properties. Even if you do not incur interest expense for your primary home, you are still limited to deducting interest expense on only one of the other two properties.

If you finance the purchase of timeshare weeks at different resorts, only the interest expense on one of those purchases will be deductible. However, if you own multiple weeks at one resort and have financed their purchase, we believe there is a reasonable position to take that the multiple weeks at that one resort constitute a single home for those rules. If the weeks are fixed rather than floating, we believe a stronger case would exist if the weeks owned are contiguous.

 

[Dean]

Father isn't home at the moment so I don't have that EXACT answer but here's an interesting article I found...

Interest paid on a loan to buy a timeshare week is often deductible. The tax law allows deductions for most interest expense that an individual pays on a primary home and one other home, such as a timeshare or other vacation home.

If you have loans on more than two eligible homes, you may choose which two homes (one of which must be your primary home) you will treat as qualifying for interest deduction purposes. You may change your choice of qualifying properties from year to year.

It also requires that the qualifying asset be directly linked to the loan in question.

I can tell you that no matter what you hear, it's essentially impossible to count a trip to check on a single rental property, esp if it's a timeshare. You'd have to prove a significant interest (like multiple wholly owned units), that the trip was needed as part of the ownership process and that it was strictly for business, not a combination of business and pleasure.

 

[DW-Admin]

like I said thats what I was told, not a big deal I guess... Thanks for the info

 

[SamSam]

You can deduct anything you want, but proving it's legitimate in an audit can be very difficult!