Christian Posted March 3, 2015 Report Share Posted March 3, 2015 A client has come to me this year since her former taxman passed away. She has among her property a couple of timeshares. She rents one or two of these each year for nominal amounts. I have looked but can find no definitive info on deductions from this income. Her former taxman took deductions which I can easily identify but I cannot quite figure his taking depreciation on these units. Can anyone advise a definitive source on this or simply identify the few deductions allowed on a timeshare. Quote Link to comment Share on other sites More sharing options...
Pacun Posted March 3, 2015 Report Share Posted March 3, 2015 (edited) If it is nominal amounts, why don't you do what the other preparer did? Materiality still exists. Edited March 3, 2015 by Pacun Quote Link to comment Share on other sites More sharing options...
Christian Posted March 3, 2015 Author Report Share Posted March 3, 2015 Frankly for my part I would just use the sum $300 and applied it against maintenance expenses and let it go. Her former guy used EVERY conceivable thing to show a loss even a small one to decrease their taxes. Quote Link to comment Share on other sites More sharing options...
Max W Posted March 3, 2015 Report Share Posted March 3, 2015 Rental income for 2 weeks or less is tax free. Why even bother with it? Quote Link to comment Share on other sites More sharing options...
Lee B Posted March 3, 2015 Report Share Posted March 3, 2015 (edited) Here is a very good analysis: www.fogelcpa.com/Documents/Fogel-TimesharesCSEA.pdf Edited March 3, 2015 by cbslee Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted March 3, 2015 Report Share Posted March 3, 2015 A client has come to me this year since her former taxman passed away. She has among her property a couple of timeshares. She rents one or two of these each year for nominal amounts. I have looked but can find no definitive info on deductions from this income. Her former taxman took deductions which I can easily identify but I cannot quite figure his taking depreciation on these units. Can anyone advise a definitive source on this or simply identify the few deductions allowed on a timeshare. If she rents them, then taking depreciation is the correct thing to do. From the IRS Topic 415 - Renting Residential and Vacation Property If you receive rental income for the use of a dwelling unit, such as a house or an apartment, you may deduct certain expenses. These expenses, which may include mortgage interest, real estate taxes, casualty losses, maintenance, utilities, insurance, and depreciation, will reduce the amount of rental income that is subject to tax. You will generally report such income and expenses on Form 1040 (PDF), U.S. Individual Income Tax Return and on Form 1040, Schedule E (PDF), Supplemental Income and Loss. If you are renting to make a profit and do not use the dwelling unit as a personal residence, then your deductible rental expenses may be more than your gross rental income. Your rental losses, however, generally will be limited by the "at-risk" rules and/or the passive activity loss rules. For information on these limits, refer to Publication 925, Passive Activities and At-Risk Rules. Quote Link to comment Share on other sites More sharing options...
Lee B Posted March 3, 2015 Report Share Posted March 3, 2015 Here is a very good analysis: www.fogelcpa.com/Documents/Fogel-TimesharesCSEA.pdf After reading this analysis I disagree. Quote Link to comment Share on other sites More sharing options...
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