Sale of timeshare due to bankruptcy

[Mixedupmo]

After two years in courts the sale of Harbor Hill in Provincetown, MA has been completed. Due to criminals running the place it went bankrupt.
We originally paid $11,000 for our week. After the sale our payout was $3,900. I know we can't write off a loss. Do we have to pay federal taxes as misc income for the $3900?
Thanks for your help!

 

[SandyPGravel]

After two years in courts the sale of Harbor Hill in Provincetown, MA has been completed. Due to criminals running the place it went bankrupt.
We originally paid $11,000 for our week. After the sale our payout was $3,900. I know we can't write off a loss. Do we have to pay federal taxes as misc income for the $3900?
Thanks for your help!

I have no idea, but I sure hope not. Whether or not you can claim as loss, you certainly didn't "make" money on the deal. Good luck!

 

[tschwa2]

Not a tax lawyer but I would think not. If you paid $1 resale and then were given a payout of $3900 then probably. But since you paid more than the payout, I don't see how you could owe taxes on it.

 

[DrQ]

Do you have documentation of your purchase price in case the issue you a 1099?

 

[SmithOp]

Consider yourself lucky you received $3900, a lot of timeshare owners struggle to get rid of timeshares for $1.

https://tug2.net/timeshare_advice/income_taxes_and_timeshares_from_an_accountant.html


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[Mixedupmo]

Do you have documentation of your purchase price in case the issue you a 1099?

Yes...I have the original purchase paperwork.