Save Money / Consumer News
Unwanted timeshare? Donate for a cause, and a tax write-off
LOS ANGELES (KABC) -- Many people who purchase timeshares discover months or years later they no longer have the time or desire to use them anymore, or they can't afford the annual maintenance fees. But selling a timeshare can be difficult. There's a way timeshare owners are getting out of their properties and getting a tax break.
While some timeshares retain or increase their value over time, others may be worth only a fraction of what was originally paid or even less than the cost of annual maintenance fees. Instead of trying to sell your timeshare, you may want to donate it, which could help cut your tax bill.
It's easy to donate clothing, toys, even vehicles. Timeshares are another matter.
Because many timeshares are worth very little, it can be difficult to find a buyer willing to take over a contract that could require them to pay several hundred, even a thousand dollars or more, in annual fees.
Marybeth Reyneveld and her husband Dirk purchased timeshares in Cancun, Mexico, and in Ramona in San Diego County. But when Dirk passed away two years ago, Marybeth had no interest in keeping them.
She paid about $1,200 to two different companies to sell the timeshares for her. They kept the money, but the timeshares never sold.
"There are so many people, scammers, that are just out to take your money up front and they say they're going to sell it or advertise it -- they do nothing," said Marybeth.
When her maintenance fees recently came up at the Riviera Oaks timeshare in Ramona, Marybeth tried a different tactic.
"I said 'Let me give it to you -- free. I'll give it back to you,' thinking, 'OK, how could they refuse?' They refused," said Marybeth.
So Marybeth decided to donate instead. She turned to Donate for a Cause, a company that sells timeshares and turns over the proceeds to a charity of your choice, after keeping an administrative fee.
"The typical donor could recognize a few thousand dollars in savings come tax time, which is much better than you're going to do wandering the Internet, hoping not to get ripped off," said James Tarpey, founder of Donate for a Cause.
Donors are able to write off the appraised fair market value of the timeshare on their taxes, not the amount the property sells for, which could be a lot less.
While donating a timeshare may seem like an easy way to get rid of an unwanted property and help out a charity, it does have pitfalls.
If your timeshare has little monetary value, you may have to "pay" the charity to take it off your hands. That's because a charity doesn't want to be on the hook for the maintenance fees.
Donate for a Cause doesn't accept timeshares if you still have a mortgage or if you're behind on your maintenance fees. It only deals with properties that are free and clear.
For charities like the National Foundation for Cancer Research, timeshare donations have raised more than $150,000 for cancer research.
"It's really a win-win situation because the donor is relieved of a responsibility for paying maintenance fees for a timeshare which they no longer want," said Liz Diamond, major gifts officer at the National Foundation for Cancer Research.
For timeshare owners like Marybeth, getting rid of an unwanted property like this one in Ramona brings a sense of relief, even though it cost her about $1,500 to liquidate the property.
"Since I found that I can't even give it away, this was really good news," said Marybeth.
It could take up to three months to get the paperwork processed and your timeshare donated. So if you're thinking of a tax deduction for April, you'll need to act soon.
real estate, charity, save money / consumer news, ric romero
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