Quote:
Originally Posted by RCMcKenzie
Thanks for the info, Bob. My accountant has always advised me to never sell, it's too complicated. In your scenario, I have zero interest in trading baseball cards. I thought it would be a tax free exchange, with a deferred tax due.
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Nic mentioned this earlier, when the new tax law overhaul and changes from 2018 went into effect, they also amended Section 1031 of the Internal Revenue Code, which dealt with Like-Kind Exchanges. After the amendment to that section of the tax code, the only thing you can exchange/trade with potentially no current tax consequences is real estate (land and buildings). That is it now.
And your accountant sounds like he/she is no dummy. Let me guess, you probably don't have perfect records that show everything you ever paid for all the items in your collection, right? And you may have hundreds (or even thousands) of cards as well. If you go to sell off a big chunk of your collection, your accountant ends up potentially having to list and report every single card you sell as a separate taxable transaction on your tax return. That is if you are a collector or investor. If you're a dealer, it is actually a little easier in that you only have to report your sales in total, but the tax consequences can be even worse because now you're talking ordinary income, not capital gains, and you can be subject to self-employment taxes (social security and Medicare) on top of your income taxes as well if you're a dealer. Fun, fun, fun!