Sale of Timeshares

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  • #1779
    ReachELS
    Participant

    I understand that if you had a gain from the sale of the timeshare, it would be treated as a capital gain and taxed at the more favorable capital gains tax rates. However, loss on the sale of real property is not deductible.

    What if you were selling TWO timeshares, one with a gain and the other at a loss? Say, I make $5k on one timeshare and lose $6k on the other:

    1. Am I forced to claim the $5k while getting no benefit of the $6k loss or
    2. Can I net the two to a $1k loss…which I then cannot claim?

    #1780
    Kaye Thomas
    Moderator

    Loss on the sale of real property can be deductible — but not if it’s personal use property, as is normally the case for a timeshare.

    The IRS doesn’t permit netting of gains and losses in a situation like this. You would have to report the $5K gain.

    #1782
    ReachELS
    Participant

    Kaye,

    This is the 2nd time in the last few weeks that you have very promptly responded to my tax inquiry…thank you so much. I am very appreciative.

    Unfortunately – and also for the 2nd time – your response was not what I was hoping to hear!

    #1783
    Kaye Thomas
    Moderator

    You’re welcome. They say that when there’s bad news, it’s best to deliver it promptly.

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