Original Message:
tax question: donating a timeshare that I paid $1 for (by Brent M.):
jayjay – Resorts sell timeshares for thousands of dollars every day. We sell them every day as well, often to brokers who are flipping them for a profit. An owner’s inability to market effectively doesn’t mean their property has no value. Remember, a timeshare is normally considered real estate and it’s valuation is much more complex than you are making it out to be, I would encourage you to read the real estate section of IRS Publication 561, see page 6.
donp - You cannot just go out and get an appraisal for whatever amount you want. Real estate appraisers must be certified and the appraiser is liable if they are found to be inflating fair market value. They can face penalties around $1,000 *per inflated appraisal*. Our donors pay $150 to $180 to get an independent third-party appraisal. You are speculating that an appraiser who invested thousands in getting certification and building a business would be willing to risk thousands more in penalties for $150 in fees. That just doesn’t add up.
Both of you seem to be basing your assumptions on IRS directions regarding the donation of boats, cars, and planes. The IRS made exceptions for those specific donations, the exceptions *do not* extend to the donation of real estate.