Timeshare

[BP.]

Client had a timeshare that he paid about $15,000 for about 10 years ago. He told me it was for his personal vacation use, not investment and not a rental. Over the years his maintenance fees totalled about another $5,000.

He wanted out of ownership, but was unable to sell. He wound up doing what he termed "transferring" the timeshare to a realty company. He got nothing at all from the transaction beyond escaping ownership of the timeshare.

The realty company told him the approx $20,000 was deductible on his tax return over a five year period. I'm thinking, personal non-deductible loss. Am I chalking this up to another tax tip from a dubious source, or can anyone enlighten me please about any factors here I am missing? Thank you so much.

[Jiggers]

Timeshares

Non-deductible. You can't deduct the loss on your residence if you sell it for a loss!

[BP.]

Thank you, Jiggers, for taking the time to confirm. Client accepted my approach in not deducting the loss, but also believed that somehow the realty company must know what they were talking about.

[OldJack]

>>$20,000 was deductible on his tax return over a five year period.<<

Deductible over 5 year period? That indicates either the realty company doesn't know what they are talking about or they are trying to say this is deductible as a charity deduction (which has a 5 years carryover limit). That is the only 5 year thing I can think of. I expect you are correct to consider this as "expert tax advice" from a dubious source.