Point swaps with other DVC owners

[CarolynFH]

I’m just beginning my DVC tycoon journey and far from having enough extra points i can rent them, but when I report income for the rental properties I own, I get to deduct all costs and expenses in maintaining the property plus the mortgage payments… so if you rent out points, shouldn’t the reportable 1099 income only be the cost per point above the sum of your annual dues and initial purchase price divided by the life of contract?

I think the 1099 is simply a report from the entity of how much you received from them. On your tax return you get to explain to the IRS why you shouldn’t pay tax on the entire amount.

 

[drusba]

I’m just beginning my DVC tycoon journey and far from having enough extra points i can rent them, but when I report income for the rental properties I own, I get to deduct all costs and expenses in maintaining the property plus the mortgage payments… so if you rent out points, shouldn’t the reportable 1099 income only be the cost per point above the sum of your annual dues and initial purchase price divided by the life of contract?

1099's report only the income you received for a rental, not any possible deductions, and all of it is taxable unless you prepare and submit with your tax return a Schedule E (1040), claiming any applicable deductions for the rental.

Also note that though you may be able to deduct depreciation expense, it is not calculated as being the initial purchase price divided by the life of the contract. If you owned the timeshare for less than a year, the annual deprecation expense you may be take is 3.485% of the purchase price. If you have owned the timeshare for more than a year when rented, it is 3.485% of its current market value, which you need to determine. For DVC, for which there is a large resale market and many published articles online on monthly and annual average sale prices per point, you can find evidence to estimate current market value for the points used for the rental. For many timeshares, that evidence is not available or the timeshare is one of the many whose resale market value becomes close to nothing as time passes. Moreover, "all" your annual dues are not deductible. One either needs to review many articles on what dues one can actually deduct or hire a tax professional to do the taxes

 

[crisi]

I just think point for point is fair......

I realise if I wanted BWV I would get more nights per point that someone using my RIV ones

Not at all. I'm a BWV owner, and if I wanted to book RIV, I just WOULD. My eleven month window at BWV for BWView is worth WAY more than point for point. Plus, why would I, as a BWV owner, ever want to stay at RIV, I have the far superior location? It would need to be MORE than a night for night swap for me to even think it was close to a good deal.

(As an example of why what you think is fair isn't fair).