Vacation ownership sold from Sheraton to Marriott. Received 1099-S for sale of Sheraton, but sale went into purchase of Marriott & got 1098. How do I enter to avoid gain?

[jenp123]

When I enter the 1099-S, it adds it as income, which I never received. That money from the sale went into the Marriott purchase. How do I enter this so I'm not being taxed on the sale for money I never received? When I entered the 1099-S, it reduced my refund by about $5000. When I enter in the 1098 for the new purchase, it didn't change anything.

[MaryK4 · Accepted solution]

This would be an exchange of property so you would not pay as a sale of the old property.  You will want to keep track of the proceeds to determine the basis when you do dispose of the new Marriott property.  If you want to report it on your tax return, enter your Basis for the same amount as your proceeds to show no taxable income.  The proceeds are then used as the basis for the new timeshare (if you had to pay additional amounts as part of the exchange, you would also add that amount to the basis of the new property when you sell it).  See Nontaxable exchange.

[safety ace]

Where in Turbotax Premier do I enter a non-taxable exchange related to a timeshare?  I "sold" my existing timeshare points and purchased additional timeshare points, using the value of the old points as a credit towards the additional points purchase.  I made no profit on the exchange, but received a 1099-S for the transaction.

[AmyC]

You would enter the 1099-S as a sale of your second home. Use the same cost basis and sales price. See Where do I enter the sale of a second home, an inherited home, or land on my  taxes?

@safety ace 

[jenp123]

Hi

Thank you! What if I paid more for the original timeshare than the amount Marriott gave me, do I enter in the higher amount in the cost basis box?  Thanks! 

Actually nevermind. According to TurboTax, you can't take a loss on a personal property, so it doesn't make a difference. Thanks again!

[AmyC]

Yes, enter the amount you paid originally.