Option 4: Donate your Timeshare to Charity
(Best choice)
Through Donate For A Cause
Donation is the best option for most timeshare owners. While many people hope to recoup some or all of the $20,000 they spent when buying a timeshare, the truth is that this probably won't happen. Most timeshares today have no resale value. Even the best are worth a quarter of their original price.
Donating your timeshare will allow you to take a hefty tax write-off and quickly get out of your unwanted property, i.e. recurring assessment fees. This is possible because the fair market value "is the price that would be agreed on between a willing buyer and a willing seller, with neither being required to act, and both having reasonable knowledge of the relevant facts" as stated in IRS Publication 561.
Think of it this way; Would you pay top dollar for a house that you couldn't see until after the closing? Probably not. Yet that's how timeshares are typically sold. Therefore, the best determining factor of fair market value for these types of properties is the developer's price. . That's because developers are the only ones capable or showing a property and contracting with a buyer who has reasonable knowledge of the properties description and amenities.
Even still, the value of the donation must be determined by an independent third-party appraiser. I have reviewed thousands of timeshare appraisals, which come in at about 80% of the original purchase price. That's because developers sell hundreds of the same weeks as yours, for $20,000-$30,000. If you had their marketing resources and sales team at your disposal you would have sold it for the same price. If your property doesn't have an active sales team then it will be compared to the sales of a nearby, similarly situated property that does have one.
A good non-profit timeshare donation company like www.donateforacause.org will not charge anything for the nicest 20-25% of timeshares. For those of lesser value, there will be a processing fee. This fee covers processing, marketing and closing costs. Unless the charity has these costs covered by you, they will lose money from your donation.
The good news is that the processing fee you pay is an added tax write-off along with tax write off you get on your donated timeshare. I have performed more than 5,000 timeshare donations and the average donor recovers about $6,200 in savings come tax time. Be prepared to spend about $2,000 in fees. That still gives you a $4,200 net profit, which is much better than paying a rescue company $4,000 for no tax receipt or $500 to a listing company with no results whatsoever.