Help pack a million meals for struggling seniors on 9-11. Volunteer today

AARP The Magazine

On Your Side

The Hidden Costs of Donating a Time-Share

If philanthropy is your priority, give directly to a charity of your choice

Pink Villa on the sand at the beach (Getty Images)

Donating a time-share can have hidden costs. — Charles Humphries

Getting out from under a vacation property often means a passel of hassles.

Time-share owners frequently discover that the resale value of their piece of paradise is only a fraction of what they paid; many are reduced to listing time-shares on Craigslist or eBay for pennies on the dollar, or paying shady resellers hundreds or even thousands of dollars to take the properties off their hands.

Meanwhile, those annual maintenance fees keep rising. That's why AARP member Linda Milgate, 61, of Santa Cruz, Calif., asked On Your Side about donating a time-share to charity via an organization called Donate for a Cause (DFC).

Sign up for the AARP Money Newsletter

For owners trying to avoid myriad resale scams, DFC looks promising. It offers to help transfer title, sell the property and donate a portion of the proceeds to charities like the American Cancer Society. The owner can write off the fair market value of the time-share on his or her federal income tax return. In theory, everyone wins.

But unloading your vacation villa might not be as simple or inexpensive as the DFC pitch portrays. To donate a time-share, you first transfer title to the nonprofit DFC, founded by attorney Jim Tarpey — who also owns Resort Closings, a for-profit title company with which the charity shares staff and facilities in Bozeman, Mont. DFC funnels prospective donors to Resort Closings, which collects $2,495 from most owners to process the title transfer and other paperwork. Donors are told they can recoup several times that amount ($6,000, according to the website) by claiming the time-share's market value as a charitable donation on their income tax returns.

Not so fast, warns the IRS. While time-share owners may be tempted to claim a five-figure value based on their original purchase price or what the resort is asking for similar units, the amount you can legally deduct depends on the "fair market value" — what a "knowledgeable buyer" would pay, not what a friendly appraiser says it might be worth. Time-shares donated to DFC sometimes sell for as little as $50, Tarpey admits — a figure DFC reports to the IRS.

So DFC may be able to help you escape your time-share (at a cost of a few thousand dollars), but don't count on safely claiming a big tax write-off. And note that the average donation generates only about $400 to downstream charities, according to DFC. If philanthropy is your priority, just write a check directly to a charity of your choice.

Consumer advocate Ron Burley writes the On Your Side column for AARP and is the author of Unscrewed: The Consumer's Guide to Getting What You Paid For.

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts


Please wait...

progress bar, please wait

Video Extra

Scams, Fraud and Time-Shares: Bob Jackson, AARP Texas senior state director, talks about time-share scams and how you can avoid getting trapped in fraud.

Tell Us WhatYou Think

Please leave your comment below.


The Cheap Life

Jeff Yeager Cheap Life Ultimate Cheapskate AARP YouTube web series save money

Catch the latest episode of The Cheap Life starring Jeff Yeager, AARP's Ultimate Cheapskate. Watch

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

Member Benefits HomeServe

Members can protect their homes with comprehensive repair plans from HomeServe.

AARP Credit card from Chase

Members can get cash back rewards on purchases with the AARP® Credit Card from Chase.

Woman holding smartphone in city, Google map tool

Members can find discounts on the go via the AARP® Member Advantages Offer Finder app.

Member Benefits

Join or renew today! AARP members receive exclusive member benefits & affect social change.

Rewards for Good

Your Points Balance:

Learn More

Earn points for completing free online activities designed to enrich your life.

Find more ways to earn points

Redeem your points to save on merchandise, travel, and more.

Find more ways to redeem points


Advance your skills. Transform your career.

Explore your learning possibilities.