August 10, 2007, Newsletter Issue #58: Taxation

Tip of the Week

Unless you rent your timeshare to others, it's possible that you have no tax deductions available.

Still, if property taxes for your unit are billed separately to you (such as in California), they are deductible. They should be deductible if the resort has them listed separately on your maintenance fee billing.

The interest is deductible if the loan is secured by the timeshare as a mortgage and you deduct no other mortgage interest except on your primary home.

If you finance the purchase through a credit card, the interest will not be deductible.

If you financed your timeshare by taking out a home equity loan/refinancing on your residence, the interest is usually deductible with some restrictions

If there is a mortgage on your main home, interest paid on multiple timeshares will not be deductible. If the timeshares are all in on resort you might be able to view this as one “residence”. The tax laws are not really clear on this issue.

However there is a clear law that there will be no deductions allowed for using it business-wise as an “entertainment facility”.

And just like your main residence, no deductions are allow on your annual maintenance fee for the timeshares as it is used for the likes of utilities, pool care, lawn care, and etcetera!

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