Cost basis - Warning tax related topic

[jethrod3]

Originally Posted by obcbobd

In the early 1990s I worked for the Massachusetts Department of Revenue. I also went to the occasional card show. I noticed that with the exception of Hall's Nostalgia, who had a physical store, no one charged state sales tax. I thought of asking one of my managers why they didn't crack down on this, of course I never did. Thirty years later I still never see anyone charging sales tax at shows.

So several years ago, when I had started doing one or two local small shows, I was under the impression (for whatever reason, right or wrong) that setting up at an occasional card show was pretty much the equivalent of setting up a garage sale: I was selling essentially second-hand stuff, not with the idea of making a huge profit (or often any profit), and I believe I'd read some tax rules about there being some number of times you could set up for a garage sale and NOT have to declare the financials unless you exceeded that number.

Even if I were to do a show again tomorrow, my intention would be to not sell off my few high-dollar collectibles for a profit now; it would be to reduce clutter from my collection and attempt to break even on stuff I either no longer want (much like one does at a garage sale) or that was thrown in with other items in auction lots that I actually wanted.

This of course begs the question: If someone, for the sake of discussion, is not a collector now, but has 5 sets of 1988 Topps baseball that they sell at a garage sale for $15 each because at time of purchase they thought it could be a great investment (but now is hardly worth the paper the cards are printed on), are those sets deemed collectibles and thus subject to reporting to the IRS? From what I've read, if the seller makes any profit, I think the answer unfortunately would be yes! But unless there are stricter rules for garage sales, unless I'm missing something, the tax law would be quite unenforceable.