Is A Timshare Loss Tax Deductible

[jeffrey]

Nope, sorry...afraid it isn't which shouldn't come as much of a surprise (if you have a gain, then it is taxable)

Q: We purchased a timeshare condominium in 1982 and are now selling it at a loss. Can we claim the loss on our 2007 taxes? What form do we use to handle this and what documentation of the sale do we need?

As a personal asset, a gain or profit on the sale of a timeshare is taxable and reported on Schedule D of your tax return.

However a loss on the sale of a personal asset is not deductible and therefore doesn't need to be reported. more info (http://www.usatoday.com/money/perfi/taxes/2007-03-05-aicpa16-brezik_N.htm)

[sledua]

What is the logic for only assessing gains whilst a loss is non deductible? From a tax perspective, if you are running a business of unit rentals hence any losses should be deductible, maybe youcan advise me on the reason.

Thanks
Sai

[T/S Guy]

Jeffery,

My information may be incorrect, so please clarify.

If you were to rent or offer to rent a timeshare, and since it would be determined a business, wouldn't the resale loss be determined as a tax deduction? You may be limited to a $3,000.00 per year deduction with carry forward rights.

Also, it is my understanding that a timeshare owner can rent upto 14 nights per year income tax free.

I am wondering if these are fact or fiction. Please advise. Thank you.

[jeffrey]

Here is the IRS page for renting your timeshare

http://www.irs.gov/faqs/faq/0,,id=199626,00.html

There is more to it than simply renting a timeshare and calling it a business. If you meet all the requirements to make it a business, then it would have different rules under IRS guidelines than if the timeshare was personal property.