Renting Points through David's vs. DVCRentalStore?

[NY Pirate Princess]

I enjoyed renting points through David's for years. I was on rented points at BCV in March of 2020. Our reservation was successfully completed prior to the shutdown. We were lucky.

Now I own a small resale contract of my own.

While you can never manage all risk, I determined owning is more comfortable for me.

 

[disfanfromnc]

If renting through David's, be aware the only form of payment they use is PayPal. PayPal recently withheld 24% of my rental payment to send to the IRS. Not David's fault but they only use PayPal so until they change that, be prepared to pay the high tax fee upfront.

 

[Willow Ufgood]

If renting through David's, be aware the only form of payment they use is PayPal. PayPal recently withheld 24% of my rental payment to send to the IRS. Not David's fault but they only use PayPal so until they change that, be prepared to pay the high tax fee upfront.

Wow! This is the first time that I've read of PayPal doing this for David's payments. Did PayPal issue you some sort of tax form when they withheld this money?

 

[reddog21]

If renting through David's, be aware the only form of payment they use is PayPal. PayPal recently withheld 24% of my rental payment to send to the IRS. Not David's fault but they only use PayPal so until they change that, be prepared to pay the high tax fee upfront.

This is an IRS rule it has nothing to do with Paypal, if you have a confirmed tax id they don't withhold any money and send you a 1099 like any other company. If you don't have a verified tax id then they take the 24% and the rest of the money is distributed after 60 days. I believe if you verify your tax status within the 60 days the funds are released back to you.

 

[CastAStone]

If renting through David's, be aware the only form of payment they use is PayPal. PayPal recently withheld 24% of my rental payment to send to the IRS. Not David's fault but they only use PayPal so until they change that, be prepared to pay the high tax fee upfront.

Iiiiiiintresting. That didn’t happen to me 2 weeks ago.

 

[reddog21]

Iiiiiiintresting. That didn’t happen to me 2 weeks ago.

If paypal can tie you back to the IRS via SSN/Tax id...etc. It's my understaning there is no hold and your money gets released as usual and paypal just reports it to the IRS like any other company. The hold only applies if it can't match you to the IRS so it doesn't know what to do with the money so it goes on hold.

 

[CastAStone]

If paypal can tie you back to the IRS via SSN/Tax id...etc. It's my understaning there is no hold and your money gets released as usual and paypal just reports it to the IRS like any other company. The hold only applies if it can't match you to the IRS so it doesn't know what to do with the money so it goes on hold.

Okay fine, Ill pay my taxes…

 

[gharter]

We rented out points 2 years ago during Covid and had no taxes withheld. However, we were sure to put that on our taxes, just to be sure everything matched up. They made the entire process very easy.

 

[AstroBlasters]

From David’s: We do not issue any income reporting information to any tax authorities. It is your responsibility to report any personal income you may receive.

When I rented through DVCRM they issued a tax form, not PayPal.

 

[JackosinDIS]

From David’s: We do not issue any income reporting information to any tax authorities. It is your responsibility to report any personal income you may receive.

When I rented through DVCRM they issued a tax form, not PayPal.

PayPal now also has obligations to issue a 1099 when payments exceed a certain level. I believe this only applies for goods and services payments. The guidance on PayPal states:

Beginning January 1, 2024, the Internal Revenue Service (IRS) implemented new reporting requirements for payments received for goods and services, which will lower the reporting threshold to $600 USD for the 2024 tax season from 2023’s threshold of $20,000 USD and 200 transactions. Here’s some more detail:

1099-K Threshold Change:

• This new Threshold Change is only for payments received for goods and services transactions, so this doesn’t include things like paying your family or friends back using PayPal for dinner, gifts, shared trips, etc.
• This change was introduced in the American Rescue Plan Act of 2021, which amended some sections of the Internal Revenue Code to require Third-Party Settlement Organizations (TPSOs), like PayPal, to report goods and services transactions paid to customers with $600 USD or more in annual gross sales on 1099-K forms. Previously, a 1099-K is only required when a user receives more than $20,000 USD in goods and services transactions and more than 200 goods and services transactions in a calendar year.
• PayPal tax reporting is required when the sender identifies the product as goods and services to the IRS, even if it was a mistake. This requirement applies once you receive $600 USD or more from this type of payment. Although this transaction is reportable by PayPal, it’s possible that the transaction is not taxable. It’s always best to speak with a tax professional for any specific concerns you may have.

 

[AstroBlasters]

PayPal now also has obligations to issue a 1099 when payments exceed a certain level. I believe this only applies for goods and services payments. The guidance on PayPal states:

Beginning January 1, 2024, the Internal Revenue Service (IRS) implemented new reporting requirements for payments received for goods and services, which will lower the reporting threshold to $600 USD for the 2024 tax season from 2023’s threshold of $20,000 USD and 200 transactions. Here’s some more detail:

1099-K Threshold Change:

• This new Threshold Change is only for payments received for goods and services transactions, so this doesn’t include things like paying your family or friends back using PayPal for dinner, gifts, shared trips, etc.
• This change was introduced in the American Rescue Plan Act of 2021, which amended some sections of the Internal Revenue Code to require Third-Party Settlement Organizations (TPSOs), like PayPal, to report goods and services transactions paid to customers with $600 USD or more in annual gross sales on 1099-K forms. Previously, a 1099-K is only required when a user receives more than $20,000 USD in goods and services transactions and more than 200 goods and services transactions in a calendar year.
• PayPal tax reporting is required when the sender identifies the product as goods and services to the IRS, even if it was a mistake. This requirement applies once you receive $600 USD or more from this type of payment. Although this transaction is reportable by PayPal, it’s possible that the transaction is not taxable. It’s always best to speak with a tax professional for any specific concerns you may have.

So, PayPal will send a 1099-K?

 

[reddog21]

So, PayPal will send a 1099-K?

There all supposed to send you a 1099 paypal, ebay, mercari, poshmark...etc anytime you sell anything over $600 for the year.

 

[AstroBlasters]

There all supposed to send you a 1099 paypal, ebay, mercari, poshmark...etc anytime you sell anything over $600 for the year.

I predict that’s going to push a lot more rentals to DISBoards and FB where people pay as Friends and a Family.

 

[JackosinDIS]

I predict that’s going to push a lot more rentals to DISBoards and FB where people pay as Friends and a Family.

Are you suggesting that some people don’t pay tax on rental income?!

 

[AstroBlasters]

Are you suggesting that some people don’t pay tax on rental income?!

Do people give a reoccurring babysitter a 1099?

Report a gift if they spend more than $30k on a child’s wedding?

Tax software being inept at handling timeshare expenses doesn’t help either…..

 

[bdrex28]

Do people give a reoccurring babysitter a 1099?

Report a gift if they spend more than $30k on a child’s wedding?

Tax software being inept at handling timeshare expenses doesn’t help either…..

I'm sure glad that in the 80s while mowing neighborhood and business lawns no one ever took out taxes

This was before the big lawn services so as kids we made some pretty nice money tax free of course!

 

[AstroBlasters]

I'm sure glad that in the 80s while mowing neighborhood and business lawns no one ever took out taxes

This was before the big lawn services so as kids we made some pretty nice money tax free of course!

Absolutely! It taught sales, accounting, customer service, purchasing manager, etc…

And it almost instantly got spent on the weekend on gas money, food, and hopefully something that would be enjoyable to entertain a date….

 

[Phatscott25]

I've been renting with the DVC Rental Store for some time now and if you use PayPal for the payments, DVC Rental Store does not send the 1099 since the obligation lies with PayPal. However, if you use check, ACH, or some other form of direct payment from them they will issue the 1099 themselves. Also, the threshold to receive a 1099-K from PayPal (or anyone else) is $5,000 for 2024, not $600.

When the law was originally passed as part of ARP in 2021, it stated that the $600 threshold would be used beginning with the 2022 tax year. There has been a great deal of pushback on that in the industry, not only due to the threshold change but also the lack of guidance. Because of this, the IRS suspended the 2022 requirement. At that time, the understanding was there would be more clarity and it would be implemented for the 2023 tax year. Then late 2023, the IRS announced it was also suspending the 2023 requirement and that the threshold would be $5,000 for the 2024 tax year as part of a "phase-in" approach. There hasn't been further announcement since.

Source: https://www.irs.gov/newsroom/irs-an...d-of-5000-for-2024-to-phase-in-implementation

 

[eticketplease]

FYI in case this is relevant to any owners looking to rent CCV points: DVC Rental Store just dropped their CCV 7-11 months to $16 from $18 (David's is still $18). Passing along as it was very recent.

I didn’t want to have to constantly be checking inventory and then hear nothing back. Or get asked if you book this resort during the 7-11 month window when those are not the points for rent. The points I was trying to rent were for a “Premium” Resort at 10 months out and was offered $14 at The rental store. Went to David’s and was rented and paid in a day at the $18 price.
I would have rather have had ACH but it wasn’t that much of an issue with PayPal.

I was actually shocked when I just logged into rental store that they have some OKW & Vero listings at $16 instead of $12 or $14 when it is not what the rental companies consider “Premium”

 

[VGCgroupie]

I've been renting with the DVC Rental Store for some time now and if you use PayPal for the payments, DVC Rental Store does not send the 1099 since the obligation lies with PayPal. However, if you use check, ACH, or some other form of direct payment from them they will issue the 1099 themselves. Also, the threshold to receive a 1099-K from PayPal (or anyone else) is $5,000 for 2024, not $600.

When the law was originally passed as part of ARP in 2021, it stated that the $600 threshold would be used beginning with the 2022 tax year. There has been a great deal of pushback on that in the industry, not only due to the threshold change but also the lack of guidance. Because of this, the IRS suspended the 2022 requirement. At that time, the understanding was there would be more clarity and it would be implemented for the 2023 tax year. Then late 2023, the IRS announced it was also suspending the 2023 requirement and that the threshold would be $5,000 for the 2024 tax year as part of a "phase-in" approach. There hasn't been further announcement since.

Source: https://www.irs.gov/newsroom/irs-an...d-of-5000-for-2024-to-phase-in-implementation

This is great news, non DVC rental related but anytime I get a venmo payment from a friend I cringe because I didnt want to go over 600 in year.