Using points for conference-- tax writeoff?

[ironz]

I may have asked this before, and I know the bottom line is to check with our CPA, but, just double checking here.
I used some of our DVC points to stay at WDW for a conference this past year. I'm self-employed, so can take deduction for professional education expenses.
Since the points are paid for (other than MFs of course), how might I count it for a deducted expense for the conference?
a) lots of crazy math figuring out the base value of each point and showing my work for the accountant/IRS;
b) use the going rate for point rental,
c) estimate based on cash price of resort room,
d) just forget it because it's not like it's going to put me in a lower tax bracket and it's going to be a hassle.

Thanks!
Just want to get the rest of the paperwork together and down to the accountant so I can dream of another Disney vacation.

 

[wnielsen1]

Probably d)

But perhaps e) Management fees only on those points.

 

[davper]

I would use b. It is a publicly available rate that can be proved to the IRS. Again, CPA would know better.

 

[BillPA]

Do you really want IRS to look into you DVC holdings? For what $15?

 

[CraigInPA]

D, definitely D. Having something like this (or a home office deduction) could put you on the radar for an audit.

 

[supersnoop]

Do you want to pay business capital gains taxes on the points when you sell them? I'd just forget it.

 

[ironz]

Wow-- interesting group of replies so far.

a) I don't have anything to hide from the IRS. And since I likely will end up with no claimed deduction for this, they come out ahead anyway.
b) Not talking about trying to deduct longterm expenses of the entire DVC contract (which is small and totally besides the point)-- just the 'hotel value' for 4 nights while I actually attended a professional conference, which would most likely be a smaller deduction than if I had just booked the GF at the conference rate. Not sure what selling the points in the future and capital gains have anything to do with anything-- I didn't say I bought the contract for the business, nor did I indicate that I am planning on ever selling that contract.
c) I do work from home and do take a home office deduction, within IRS parameters.

So yeah, since it's just 4 nights (my estimated value would be $700-800), so will likely just make a note for the CPA and see what he wants to do about it. And just book the hotel next time so I have a receipt to show and save my points for personal travel.

 

[crisi]

ironz, the issue with the deducting the contract is that when you start using your personal property for business and charging yourself, it can start becoming business property in the eyes of the IRS - that's the concern supersnoops response. Talk to your CPA, but I would go with D myself as well. For my business and personal life, I try and have very clear lines (I do NOT take a personal office deduction because I don't want to risk recapture when I sell on the back end, for instance - recapture isn't worth the bother). And your future plan is best - use your personal point for your personal stuff, and have a receipt for the business via a regular hotel reservation.

 

[mustinjourney]

I think I remember seeing the deduction would be based on the associated maintenance fees since that is your actual cost. You don't get to deduct the opportunity costs in a business expense -- only what you paid for it. So you shouldn't be able to deduct the fair market value of those points as an expense (e.g., can't deduct $15 per point).

Now if you rented the points from someone and used those points for the rental -- then I would assume you'd be able to deduct $15+ per point since that is your actual cost -- but if you're using your own points, I would go with the MFs + upfront costs/# of years left.

Based on this website, it appears you can factor in the initial purchase price and divide that by the number of years remaining and add that to the MFs. So if you paid $40,000 for 300 points at VGF, you'd have $2.90 per point (40,000/300/46) of up front costs plus $6.13 MFs for a total of $9.03 per point.

https://bradfordtaxinstitute.com/Content/Timeshare-as-Business-Lodging-Facility.aspx

*I'm not a CPA, so I'm no expert.

 

[ironz]

ironz, the issue with the deducting the contract is that when you start using your personal property for business and charging yourself, it can start becoming business property in the eyes of the IRS - that's the concern supersnoops response. Talk to your CPA, but I would go with D myself as well. For my business and personal life, I try and have very clear lines (I do NOT take a personal office deduction because I don't want to risk recapture when I sell on the back end, for instance - recapture isn't worth the bother). And your future plan is best - use your personal point for your personal stuff, and have a receipt for the business via a regular hotel reservation.

Thanks-- It was a one-time thing--like I said, 4 whopping nights, and yeah, not worth messing with the math. Bad enough being a contract worker from home, technically self-employed. Too much math! The conference registration (for this past year) was free, besides, so pretty much just not even worth including that trip in the calculations at all.
(can I retire yet? )

 

[OKgirl]

In this case, I would get a cash room if I wanted to write it off on my taxes so you aren't "renting from yourself" which can raise red flags. I'd save my points for a recreational trip (or just rent my own points to someone else to help cover the cost of the hotel room).

 

[kniquy]

I attended a conference and ended up getting a transfer of BW points to get the room. I have all the info for what i paid for the transfer of points and i did (also a portion of my work is self employed) write off the cost of the room. Different situation, but i would definitely talk to your CPA to see if MF can be written off. If it make a difference and you get a little back go for it, if not then i guess leave it be.

 

[Halle]

I may have asked this before, and I know the bottom line is to check with our CPA, but, just double checking here.
I used some of our DVC points to stay at WDW for a conference this past year. I'm self-employed, so can take deduction for professional education expenses.
Since the points are paid for (other than MFs of course), how might I count it for a deducted expense for the conference?
a) lots of crazy math figuring out the base value of each point and showing my work for the accountant/IRS;
b) use the going rate for point rental,
c) estimate based on cash price of resort room,
d) just forget it because it's not like it's going to put me in a lower tax bracket and it's going to be a hassle.

Thanks!
Just want to get the rest of the paperwork together and down to the accountant so I can dream of another Disney vacation.

Many, Many years ago (1993) our accountant (also a DVC member) told us it couldn't be done and to rent a room.