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Coming out of the gate swinging. If you do it consistently, the IRS will accept it. I have a gmail account, and still have 20 years of emails; so that means every board purchase, ebay purchase, COMC purchase, PayPal transaction, etc all have a paper trail.
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-- PWCC: The Fish Stinks From the Head PSA: Regularly Get Cheated BGS: Can't detect trimming on modern SGC: Closed auto authentication business JSA: Approved same T206 Autos before SGC Oh, what a difference a year makes. |
#2
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You've never been to a card show? |
#3
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I rarely buy anything at card shows. But you're boring me, so I'm going to stop responding and put you on my block/ignore list.
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-- PWCC: The Fish Stinks From the Head PSA: Regularly Get Cheated BGS: Can't detect trimming on modern SGC: Closed auto authentication business JSA: Approved same T206 Autos before SGC Oh, what a difference a year makes. Last edited by swarmee; 09-04-2022 at 07:26 PM. |
#4
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.
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Leon Luckey |
#5
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How is it antagonistic to ask if hand written notes and an inbox with two decades worth of emails are acceptable forms of record keeping to the IRS? This is uncharted waters for many people and instead of helping, you guys respond like you're guarding a state secret. Very odd. |
#6
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Here’s the thing - unless your basis is really high, it’s just not going to matter enough for the IRS to fight you on it. You say your basis is $20? There’s no juice to the squeeze for them to argue that it’s less. Even if they are right, they’re not going to pick up much more than $5 off you. Not unless you’re selling 50,000 items at $20 basis. And if your cost basis is really high, then you hopefully have been keeping some documentation in hand. There’s one more wrinkle here- what happens when you die? Your assets enter your estate, and your heirs step up the basis to market value at your death. This way, even if they don’t know what your basis was, they get a new basis when they inherit from you. No state secrets here. But as with many things in tax law, it’s often not as black and white as we might hope.
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Trying to wrap up my master mays set, with just a few left: 1968 American Oil left side 1971 Bazooka numbered complete panel |
#7
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#8
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Bump for BobC to find.
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#9
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I have had this discussion with my accountant when I was trying to clarify if my bookkeeping was correct. I purchased a lot of a few thousand cards for $1000. I select many of the good cards out of the lot and sell them via ebay paying seller fees and shipping fees. The proceeds from each of these transactions I use to buy down the purchase price of the lot until I have recouped all $1000 I had spent (I'm literally determining cost basis of whatever I want but in this case it was the total value received). Once the lot was payed for then the remainder of my items I owned at a $0 cost basis and then taxes were paid on the proceeds from those cards as those sales were all profit. He said I can determine my cost basis any way I want as long as it's consistent and that I am keeping documentation.
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#10
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Being mocked for suggesting that it may not be easy to know every purchase price in your collection is absurd. |
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Didn't really need me on this one. Nicolo/raulus and Scott/Smarti5051 did a pretty good job saying mostly what I would. Try to remember what you can and/or have records and receipts for, and for everything else, estimate as best you can. Try to be reasonable and consistent in how you estimate and value things. Also, start writing stuff down if you hadn't before, especially in regard to things you're now estimating and/or allocating.
Maybe the biggest thing to make certain of when filing your federal income tax return is that everything is complete and properly filled out with no obvious omissions or mathematical errors that would otherwise cause your return to be kicked out by the IRS's system, and therefore possibly subject it to additional, actual human scrutiny. If you normally prepare and file your federal tax returns yourself, you may want to at least have someone with tax knowledge and experience look over and proofread the first tax return you start reporting these sales on, just to be safe and make sure you're not blatantly missing or doing something wrong. And unless you're a dealer filing and reporting your card activity as a business, you'll most likely be filing and reporting your card activity as a collector/hobbyist, in which case you don't want to show any losses for items you sold. If you are into cards as a hobby, you have to report and pay tax on any gains you may have had from your sales, but for any sales losses they aren't deductible, and you just end up reporting them as $0 gain/income on your return. If you want more tax related info, go into the Search link, and then go into Advanced Searches. Once there, enter my username, BobC, and then hit the Search button. It will take you to all the threads I've ever posted in. Look for threads that mention or involve tax issues/questions (including threads about "vaults"), and just click on those thread links and look in them for my posts. I'll forewarn you to block out some time before you go looking, and maybe grab yourself a cup of coffee or a cold one before you sit down to begin. You'll find a lot of tax questions, issues, and topics related to the hobby are gone into in some detail. If you come up with any further tax related issues or questions, just ask. Good luck. Last edited by BobC; 09-10-2022 at 03:53 AM. |
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One of these days maybe I should go back through all the tax related threads I've ever posted in and put all the links to those in one new thread. That way, instead of always having to type the same or similar tax related answers and comments out in each new thread someone else starts, I can just post a link to the thread containing links to all my other tax related posts, and just say, "Read this.".
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#13
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I want to be sure I understand the section above because I was thinking I could net sales out and as long as the result was not a loss, I was good. But it sounds like you're saying this: Example using small numbers for simplicity...If I sell 10 items and seven of them sell for $1000 each (plus $7000) and the other 3 I lose $1000 each (-$3000), I pay taxes on $7000 and not the net result $4000. Correct? |
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