Can You Donate Your Timeshare?

You can donate timeshare and help others at the same time by getting rid of an investment that may not have worked out for you. Many people view the donation option as a last resort, but you can benefit from donating sooner rather than later. Here's what you need to know about charitable donations and timeshares:

Benefits of Donating a Timeshare

Your options for getting rid of a timeshare are to sell it or donate it. Renting it can be hard, and most people prefer not to deal with the hassles associated with being a long distance landlord. You can donate a timeshare and gain many benefits, such as:

  • Avoid the selling process, which is tough for timeshares
  • Gain more with a tax write-off than holding on to a timeshare that never sells
  • End maintenance fees for property you're not using
  • Help to fund your favorite charitable organization
  • Don't worry about having the time to sell it
  • Doesn't cost you anything to donate
  • Some charities guarantee to transfer the timeshare out of your name in a certain time period no matter what

While there are many great benefits, you have to be careful to avoid the potential tax pitfalls as well.

How Donating a Timeshare Works

The organization that accepts your timeshare donation often enlists the help of a company to sell it and process the necessary paperwork. That company is paid a commission, plus a small fee. The rest is given to the charity, and you get to write off the value of the timeshare on your income tax returns. It's true that after commissions the charity doesn't receive as much money for the time-share, but it still does benefit them to receive something. It's often a win-win scenario for all parties involved, as long as you follow the tax rules, such as:

  • Get a written appraisal if your timeshare is worth at least $5,000
  • Don't claim more in deductions than what similar timeshares are selling for at that location
  • Claim the sales price if the charity sells your timeshare before you prepare your tax returns, if you’re unable to substantiate the value otherwise

The last thing you want to do is to invite an audit by the Internal Revenue Service (IRS) because of your timeshare donation. Ask the charity for a tax receipt letter if they don't offer one to you.

Qualifying Timeshares

Most charities accept timeshares that are paid for. Most organizations don't accept timeshares with outstanding fees, including maintenance fees or loan balances. Even if you own a timeshare free and clear, you have to pay all taxes and other bills related to the timeshare until it's sold. Some organizations do make exceptions, but it depends on your circumstances and the financial stability of the organization.

Working with a tax accountant is highly recommended when you donate a timeshare. You don’t want to end up facing a challenge by the IRS because of your donation.

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