Are Timeshare taxed

[kwayland-charter]

We are owners/members of a timeshare.  We pay an annual fee of $3,066.26 to cover management, resort staff, property maintenance, accounting and organizational fees.  A required upgrade resulted in a the need to obtain a vacation ownership loan, we paid $364.16 interest in 2020.  Can either of these be used for a tax break?

[npierson7]

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.

[Loalexan1]

When the timeshare is sold can the annual maintenance fee be used as a deduction from the proceeds of the sale for

capital gains purposes?

[Critter-3]

No... those are personal non deductible expenses.  They are also not added to the cost basis.  

[Loalexan1]

Thank you 

[Mike9241]

if you sell at a loss, it's probably not deductible.