Yes, you can deduct your expenses if your timeshare is being used to generate rental income, even if your expenses were bigger than the income on a Schedule E, supplemental income. If you bought the timeshare for your personal needs, and you used it more that 14 days in a year, you might be able to deduct the mortgage interest and taxes as a part of your itemized deductions on a Schedule A. Please, keep in mind, mortgage interest can only be claimed on a maximum of two homes (main home and a second home). If you have mortgages on two homes and a timeshare, you won’t be able to deduct the mortgage interest on one of those properties.
