It has to be done by December of the year prior to the year of usage. I'm not sure if the date is the 31st or an earlier date in December. For a week to be used in 2012 it had to be traded for points by December 2011.
On the Marriott Vacation Club web site, access your weeks online and click to use your week. The options will be there on the page that follows to use your week, trade your week, trade it for points, etc. It's easy to do.
Here's the site: https://www.my-vacationclub.com/default.jsp