DVC Point Broker's Request for 1099

[Scotch]

We've rented our points for many years via Dave's. This year we used another company for the first time. (We submitted our points availability to both outfits at the same time and the other company found a renter first.) But unlike Dave's, presumably because it is a Canadian business, the other company has requested that we complete and return a 1099 Form. We make it a rule not to disclose our SS# unless absolutely necessary, and in timeshare transactions we've only disclosed it to a licensed escrow company when selling. (We've been asked for the info from newly purchased timeshares' owner services dept, but we've always confirmed that we could omit that info if we didn't finance the purchase, and we don't provide the info.)

The email from the other company says "Your submission is needed by December 31, 2015. We will be required to show 'Would Not Provide' in the social security box of your IRS Form 1099 if not received by this time."

Since we always report our rental profits on our tax returns, we're not concerned about issues on that end. But would having this "Would Not Provide" notation raise a flag for the IRS to audit us? We've never been audited before and would hate for this to be a trigger. Do we have anyone knowledgeable about this here?

I must say that I never considered this as an issue for using an U.S. rental intermediary. In hindsight, if I had known about this, I would have stuck with renting via Dave's and avoided this hassle. The slightly extra $ per point isn't worth the trouble for me.

 

[_auroraborealis_]

This is no different than what happens with many childcare providers when someone wants to use the childcare tax credit. So long as you declare the income, you shouldn't have any issues. It's if you intended not to declare the 1099 and "would not provide" would be prejudicial.

 

[CarolMN]

Curious regarding the request - are they asking you to reply via email or do they have a secure link for you to use? Did they provide any info on how they plan to safeguard your personal info if you do provide?

I agree with pp. As long as you declare the income, I doubt the IRS would bother you. At most, they might send a letter regarding that one line item. That's what they usually do if you forget to report a capital gain or dividend/interest income.

 

[CraigInPA]

Don't disclose. Let them send you a 1099 with "would not provide" in it. That's as valid, in the IRS's eyes, as one with a valid SS# in it.

 

[hill6]

By law you are not required to report rental income if you rent your property for less than 14 days in total.

 

[_auroraborealis_]

By law you are not required to report rental income if you rent your property for less than 14 days in total.

Not sure who told you that, because that rule would NOT apply In most cases.

https://www.irs.gov/publications/p17/ch09.html goes into more detail. You have to use it YOURSELF for more than 14 days, or for at least a time equal to 10% of the time you rented it at fair market value. So if you rent your points and take no trip in the tax year, you cannot claim it as a "home."

 

[Dean]

By law you are not required to report rental income if you rent your property for less than 14 days in total.

In theory it's possible to meet the requirements for partial use for DVC or other timeshares if one owns a substantial volume but realistically it's not possible for all but a few. You'd have to own well in excess of 15 days at a single resort each year. So you'd have to stay at your home resort at least 15 days in the calendar year using one's own home resort points to consider the 14 day exclusion. As a rule, tax preparers mess this one up very often assuming the vacation home rules apply across the board.

 

[DenLo]

Florida sales tax applies too. The rate is set by the county.

Florida imposes sales tax on rental charges or room rates paid for the right to use or occupy living or sleeping accommodations. Rental charges include any charge for the use of items or services required to be paid as a condition of the use or possession of the accommodation. Florida law refers to these living or sleeping accommodations as “transient accommodations.” Most counties have a discretionary sales surtax that is imposed on rentals of transient accommodations. Form DR-15DSS provides a list of Florida counties and their surtax rates and is available in the “Forms and Publications” section of the Department’s website www.myflorida.com/dor

DR-15DSS form is located below for 2015 and 2016.

2015 - http://dor.myflorida.com/Forms_library/current/dr15dss.pdf

2015 - http://dor.myflorida.com/Forms_library/current/dr15dssr15.pdf

 

[Brian Noble]

By law you are not required to report rental income if you rent your property for less than 14 days in total.

Others have already covered this, but this likely not true for most. Here's an excellent summary of the tax issues of timeshare ownership from TUG.

http://www.tug2.net/timeshare_advice/TUG_Taxes_and_Timeshares.html

 

[Tink-n-Belle]

It's a new law that you need to send out 1099's to anyone you paid rent to over $600 or if you are a business any company not a corporation that you hired such as lawn service, heating contractor etc.

If you choose not to give the the info,I would send a copy of the 1099 to the iIRS with your tax return with a note that you have claimed the income and where it's on your tax return. My mother used to get a 1099 from her tenant and the IRS sent her a Noticed that she didn't claim income one year which she had under her sch E so to avoid the hassle every year, I just sent the 1099 with a noteshowing where the income was claimed with her tax return to IRS.