Quote:
Originally Posted by vtgmsc
Bob,
I just read your post and this got me wondering if you might be overlooking another fairly simple Course of Action. If the items that he sold via paypal in 2014 were actually purchased a certain time ago (is it more than a year?) for this problem lets just say that his stuff was purchased in 2011-2012, can't he simply fill out a Schedule D and not worry about CoGS and begginning inv/end inv etc...??
I am anxious for your answer as it seems to me this would be ok if he held those assets for a long time (sorry not exactly sure if it a year or more?) Please advise, thanks!
Peace, Mike
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I understand your question but, I kind of addressed this already when I mentioned how many dollars and how many transactions you have to have before Paypal is required to report your receipts to the IRS. At a minimum of $20,000 a year and 200+ transactions, that sounds a little bit more than just a casual collector who can take advantage of treating his sales as investments subject to capital gains taxes and not just ordinary income tax rates. Even so, you have to remember that unlike long term capital gains on the sale of regular investments like stock or bonds, those have a maximum capital gain tax rate of 20% under current law, regardless of what the taxpayer's income is. Collectibles have a higher potential capital gains rate of of up to 28%, even if held more than 12 months.
BobC