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#1
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Are baseball card transactions taxable?
Posted By: Eric Brehm
I have heard differing views on whether income tax has to be paid on the profit realized when selling a baseball card, and if so, how this income is treated for tax purposes. Does anybody have a definitive answer on this? (I am asking here specifically about income tax -- not estate tax, inheritance tax, gift tax, or state sales tax.) |
#2
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Are baseball card transactions taxable?
Posted By: barrysloate
If you make a profit on the sale of anything, you are liable to pay taxes. If it is your hobby and not your main source of income, I believe it is taxed differently. I would be careful about taking a tax write-off on a loss however, as it could raise a red flag. |
#3
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Are baseball card transactions taxable?
Posted By: leon
As Barry said it's income. I treated it as such a few years ago, actually it was a loss of a few thousand dollars, went through an IRS audit, and it was fine...I showed where I bought the cards on ebay, and sold them on ebay for a loss......I did forget about a few stocks I sold and had to pay the piper...but the card part was fine.....The IRS recognized and accepted the loss. |
#4
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Are baseball card transactions taxable?
Posted By: warshawlaw
or in most tax law, the regulations. You'd need to look at code of federal regs to find out how the catch-all has been applied. |
#5
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Are baseball card transactions taxable?
Posted By: Max Weder
Leon: |
#6
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Are baseball card transactions taxable?
Posted By: dan mckee
I file a schedule C every year and have done so since 1999 for sales on ebay. If you pay Uncle, he usually leaves you alone. If you don't pay Uncle anything as that survivor idiot, then you go to jail. |
#7
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Are baseball card transactions taxable?
Posted By: Rhys
The bottom line is that it is all taxable if there is profit involved, the key is to figure out the best tax treatment of the sale. A flat sale of a collectible is taxed at a fairly high rate. If you do what Dan does (and I do) and file a Schedule C than you get to take a lot of deductions to offset the profits like gas money to shows, hotels at shows, admission costs, internet fees, ebay fees, paypal fees, etc. My only caveat would be to NOT take the business use of the home deduction. I specialized in Tax Law during Law School and worked for a short period for the IRS in Chicago. The one piece of advice I got over and over again is that Business use of the Home is the number one red flag for an audit. Even though I could get a big deduction for it, I have never filed it and I have never been audited. Not that there is anything wrong with taking it honestly but it is so abused that the IRS has really honed in on that one and it is not worth the trouble of an audit in most cases. |
#8
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Are baseball card transactions taxable?
Posted By: Bob
Other collectors used to get a big laugh out of the fact I filed a Schedule C each year and paid capital gains on baseball card sales (and other items) profits on ebay, until I showed them an article last year that said the IRS was really going to crack down on ebay sellers who didn't do so. Now there is no more laughing |
#9
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Are baseball card transactions taxable?
Posted By: cmoking
I don't have any answers, but I do have a CPA. I give him a sum total of all cards I sold in the year plus the cost basis for those cards. He uses those numbers and plugs them in. I do have specific details for each card with receipts (although it would be a major pain in the ass to get it all out in case of an audit...yikes). I was audited last year for other reasons. Even when they went through my filing, and started to ask questions about things other than their initial reasons for auditing, they did not inquire about the collectibles profit that I reported. |
#10
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Are baseball card transactions taxable?
Posted By: Jim Manos
I claim mine as of course short term capital gains/loss. Although, I have enough loss carry forwards from some other ventures that I can sell baseball cards till I am blue in the face. Hope this helps. |
#11
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Are baseball card transactions taxable?
Posted By: Frank Wakefield
I think selling a card does not create capital gain. |
#12
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Are baseball card transactions taxable?
Posted By: barrysloate
Frank- how about if you sell a card that was in your collection for ten years. Isn't that considered a capital gain? |
#13
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Are baseball card transactions taxable?
Posted By: Frank Wakefield
I put "think" up there because I'm not certain. But I've talked with accountants who were uncomfortable with the capital gains stuff. |
#14
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Are baseball card transactions taxable?
Posted By: barrysloate
Baseball cards are a funny kind of commodity. I remember applying for my first mortgage around 1990. I told the bank in my naivete that I didn't have much money in savings, but that I had a baseball card collection worth six figures. They weren't amused! |
#15
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Are baseball card transactions taxable?
Posted By: leon
I am in no way positive but I think the amount of time you own something will make it a short, or long, term gain....which is taxed at a different rate. I thought a long term had to be 18 mos. though....Are there any CPA's here that would want to at least say what the law is, without giving advice? |
#16
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Are baseball card transactions taxable?
Posted By: Hal Lewis
Think the IRS will go after the guy who just sold his T206 Wagner for a profit of more than $1 million? |
#17
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Are baseball card transactions taxable?
Posted By: cmoking
If stamps and coins are designated as collectibles (per the original poster) ... then I don't see why sportscards aren't. |
#18
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Are baseball card transactions taxable?
Posted By: Matt
I am a CPA and I will try and clear up a few items. There is a lot of information flying around, some accurate, some inaccurate, some flat out wrong and some needs further explanation. As with most tax law, the rules are muddled, and this issue isn’t clear cut as some grey areas exist. Hopefully this doesn’t make it more confusing. |
#19
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Are baseball card transactions taxable?
Posted By: anthony
i dont tell uncle sam "sh*t" and he gets "sh*t"...other than my job/stocks/interest etc...he gets nothing! if my ssn is attached to it, then he can have a tiny piece, thats all. |
#20
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Are baseball card transactions taxable?
Posted By: Bob
As a criminal lawyer I have learned that the last place you want to end up is in a penitentiary of any sort. If you claim your sales and pay taxes on it, even if you underestimated your expenses and the inital cost or value of the cards, the worst thing that can happen is that you end up owing Uncle Sam some money. If you fail to report income, you are rolling the dice that you won't be caught. Failure to report could give you a free pass to the pen. Granted federal pens are luxury suites compared to state prisons, still they are definitely a place to be avoided. As collectors we like to think that we are simply under the radar but you might be surprised. I was startled to see an article listing the top 25 card sellers on ebay and see my ebay handle there! I believe it was in Old Cardboard but I am not positive where I saw it. Makes you think... |
#21
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Are baseball card transactions taxable?
Posted By: Eric Brehm
Matt, |
#22
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Are baseball card transactions taxable?
Posted By: Dan Bretta
Don't ask, don't tell! Just kidding....actually I rarely sell any of my baseball cards and memorabilia. |
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