Earlier this month, the state government of Florida passed bill HB 61 that codifies two tax laws related to timeshares and one financial instrument that can alleviate fears for prospective timeshare owners.
We reported on the HB 61 bill back in April when it was approved by the state House and pending passage by the state Senate. But here’s a recap to the major points of the now law:
- Timeshare exchanges are not eligible for tax. Although no state or local government has taxed timeshare exchanges, the clarification was lobbied for by the American Resort Development Association (ARDA) in order to head off any attempt to use timeshare exchanges as sources of tax revenue in this wounded economy.
“Without the consistent and strong support from sponsors, Sen. Mike Haridopolos (R-Melbourne), and Rep. Steve Precourt (R-Winter Garden), HB 61 could not have been enacted,” said Jason Gamel, Vice President of State Government Affairs of ARDA. “This ARDA-backed measure clarified the existing tax status of exchange which had been questioned by some jurisdictions as they searched for revenue in a down economy.”
- The law does set in writing the practice of charging hotel-like taxes on transient use of timeshares. This means that timeshare rentals must be taxed like hotel rooms. Taxes on transient timeshare use are already charged in the industry. So no abrupt change occurs due to this part of the law.
- Lastly, the law gives the timeshare industry access to “debt-cancellation” policies that allow timeshare owners to give back their timeshare in the event of loss of income/loss of job.