Val,
Just curious, are you a CPA or tax preparer? It's not that I doubt anything you're saying, but there were comments about looking for tax advice on a internet chat board (ok, in our minds, we're more than a casual chat board) that make sense.
Worst case is that anything you sell has a $0 cost basis for you which means the entire sale would be considered "taxable" (for the most part). An assumption is that you would take the sale price and subtract the total cost basis of the item and that would be the taxable portion of the sale.
If the above is the case, are you indicating that the tax rate is either 28% (maximum) or if lower, what the sellers actual incremental tax rate is after all considerations (deductions, etc.)? Bottom line, it sounds like you have to add the sales/profit to your declared income, then that could possibly move you to a higher tax bracket (depending upon the amount of sales/profit being delared).
How does state tax work on that? Any considerations there?
Regarding a resale license/document. What if I have a resale tax license/document and I buy something from an auction house but may not put it up for sale because I'm part hobbyist (wink, wink). Is that allowed? Or is it one of those things where there's like an honor system and everyone should pay the tax on items that may not be for "immediate" resale.
Technically, someone could say that they purchased the item (no taxes due to resale license) with an intention of selling it, much later in the future.