Time Share went bankrupt

[vodland]

Question on how much gains I should claim on a Time Share property. 

The Time Share North Pier Ocean Villas in Carolina Beach, NC, went bankrupt this year due to numerous problems.  They (North Pier) were required to pay off the owners a set amount.  That amount was $3125 in my case.  I have owned this timeshare for 37 years.  I paid $2500 for it in 1985 or so.

I have no documentation on the purchase of the timeshare anymore.  I’ve moved a few times since then and have lost the purchase documents.  I hoping to show a $625 gain not the full $3125.  I think I need a Form 1099-S.  Would that be correct, or do I do something different?

[Anonymous]

Hello vodland,

Thank you for participating in the Ask the Experts Event. As to your question, if I am reading it correctly you actually experienced a capital loss of $1,875 ($2,500 less $625), correct? You can request a 1099-S from the company who handled the bankruptcy process, but I haven't seen very many of them issued when they should. 

Either way, you can just enter the information as a capital transaction on Schedule D. Enter $625 as the proceeds and $2,500 as the cost basis. Keep as much documenation as you can for your tax files, but I wouldn't worry too much about not having your original purchase documents. If the IRS comes knocking on your door you can just explain and they should be fine.