We deeded a timeshare back to the managing company which cost us $250.00. We had paid $11,000.00 in 2008. So we have lost all of the money of purchase. Can we claim this

[HelenaC · Accepted solution]

No, you cannot deduct your loss, on a Timeshare that was personal use property. 

Timeshare property losses:

• If these were rentals, you may be able to claim losses.
•  If these were for personal use, you cannot deduct personal losses.

Personal-use property:   Generally, property held for personal use is a capital asset. Gain from a sale or exchange of that property is a capital gain. Loss from the sale or exchange of that property is not deductible. You can deduct a loss relating to personal-use property only if it results from a casualty or theft.

Per  IRS Publication 544  , chapter 4, Reporting Gains and Losses: Loss from the sale or exchange of property held for personal use is not deductible. But if you had a loss from the sale or exchange of real estate held for personal use for which you received a Form 1099-S, report the transaction on Form 8949 and Schedule D, as applicable, even though the loss is not deductible.

To enter the sale of your Timeshare(s):

 These are entered in the investment section of TurboTax. Follow these instructions:

1.     Open your return in TurboTax.

2.     In the search box, search for sold second home (use this exact phrase) and then click the "Jump to" link in the search results.

3.     Answer Yes on the Did You Sell Any Investments? screen.

o    If you land on the Here's the investment sales we have so far screen, click Add More Sales.

4.     Answer No to the 1099-B question.

5.     On the next screen, select Second Home (choose this also for inherited homes) or Land. Click Continue.

6.     Follow the on-screen instructions to completion.

[mark212]

Our problem is different. We bought our time share for 10k many years ago. The same company wanted to buy it back for 2k. We sold it to them and then they sent us a1099 for non-employee compensation. We shouldn’t have to pay taxes on that 2k, should we?

[JillS56]

No.   The sale of a timeshare is reported on Schedule D.  You will treat this as the sale of a capital asset. (However, Losses from the sale of a personal use timeshare are deemed to be personal losses and are not deductible)  

To report the sale:

1. Select Federal from the list on the left-hand side of the screen.
2. Select the Income & Expense tab at the top of the screen.
3. Scroll down to the Investment Income and click Show More and then click on Stocks, Cryptocurrency, . . . 
4. Click Start 
5. Answer the questions.   

• The acquisition date is the date you purchased the timeshare.
• The Sale Date is the date you deeded back to the Timeshare managing company.
• The proceeds would be $2,000 less the $250.
• The cost would be $11,000.

This does create a loss.   A loss on the Timeshare is not reported on the return.  If there is a gain, the gain is reported on your return.

Timeshare