Timeshare Donation Question

[Dave&Linda]

This past year we donated a floating week at the Summit at Massanuten to our church for a raffle. I don't know how much the church got for the week but we received the exchange fee from the people who won it. My question is how do I figure out what I can write off for tax purposes on it? I assume the write-off would include the maintenance fee I paid for the unit, but how do I determine the value of the place? The church wants me to provide them a figure and I don't want to come up with something that would be hard to justify if I were audited. The family who won the raffle traded it for a place in Finland. Thanks much. Dave & Linda

 

[Dave M]

Unfortunately, you are not entitled to any tax deduction in connection with your donation. There is a law which prohibits claiming a deduction for the donation of the use of property (referred to in the law as a "partial interest" in the property). Except for certain transactions involving trusts, you must transfer complete ownership of your timeshare to obtain a tax deduction.

See this thread, especially the example from an IRS publication in post #8, which is directly on point to your situation.

 

[JLB]

Speaking of donation of ownership to a qualified charity, in the instances where we have done that, or looked at charities that do that, the standard seems to be that you can take up to a $5000 deduction without an appraisal, assuming, of course, that you itemize.

Maybe Dave can comment on that.

 

[JLB]

And speaking of taxes, I'm sure everyone has heard about the short form, 1040 EZ.

Line 1--Total income from all sources.
Line 2--Send it in.

 

[Dave M]

That's correct, Jim. A formal appraisal is not required if the claimed deduction for donating ownership of a timeshare doesn't exceed $5,000.

 

[johnmfaeth]

Hi Dave,

I thought with the latest revisions to car and timeshare donations, that the deduction is limited to what the charity was actually able to sell it for, not appraised value.

I may be wrong...

John

 

[Dave M]

John -

The new law (effective for years after 2004) put that limitation in effect for autos, but not for most other assets, including timeshares. You can read about the rule in the very first paragraph ("What's New") of this IRS publication.

 

[Dave&Linda]

Thanks to All

Especially Dave for the comments. Well I guess I blew the donation, at least I know the score now. Much appreciated. Dave

 

[Bill4728]

Especially Dave for the comments. Well I guess I blew the donation, at least I know the score now. Much appreciated. Dave

You didn't blow the donation. The church was able to raffle it off and make money. So you made a nice donation to the church. You just can't deduct it from your taxes.

 

[Dave&Linda]

Exactly Right

Actually we are quite happy about the outcome of the donation as the chuch did make some money and the family who went to Finland had a great time. Guess I shouldn't have been so harsh!