sell by auction or not?

[G. Wells]

Bruce - Don't think that's relevant other than the possibility of recognizing losses if you have treated your hobby as a business and then it's subject to hobby loss rules.


IRS Regulations
Personal-use property. Generally, property held for personal use is a capital asset. Gain from a sale or exchange of that property is a capital gain. Loss from the sale or exchange of that property is not deductible. You can deduct a loss relating to personal-use property only if it results from a casualty or theft.

Of course, if you don't report the gain, it's not taxable unless you are examined by the IRS.

[George M. Purtill Member #28]

Originally Posted by G. Wells

Of course, if you don't report the gain, it's not taxable unless you are examined by the IRS.

Wow- I don't think I would follow that advice or course of conduct. Knowingly signing a false tax return is how they got Al Capone.

However, I do agree with your statement thats its taxable.

[G. Wells]

Originally Posted by George M. Purtill

Wow- I don't think I would follow that advice or course of conduct. Knowingly signing a false tax return is how they got Al Capone.

However, I do agree with your statement thats its taxable.

\

I agree completely with you. Just added that final comment, and it is not advice but a comment, because it seems many think not receiving a 1099 is sufficient to make gains not reportable and therefore non- taxable.

[George M. Purtill Member #28]

I'll bet there are a lot of unhappy people reading this thread at tax time.
The sad thing is that a lot of people could eliminate a lot of the liability by using a 1031 exchange.

[G. Wells]

Originally Posted by George M. Purtill

I'll bet there are a lot of unhappy people reading this thread at tax time.
The sad thing is that a lot of people could eliminate a lot of the liability by using a 1031 exchange.

In order for personal property to qualify for a 1031 exchange - Qualified Use Personal Property

You must have held the relinquished personal property for rental, investment or use in your trade or business, and must have the intent to hold the like-kind replacement personal property for rental, investment or use in his business. Personal property not held for rental, investment or use in your trade or business is not considered to be qualified use personal property and will not qualify for 1031 Exchange treatment.

[George M. Purtill Member #28]

Originally Posted by G. Wells

In order for personal property to qualify for a 1031 exchange - Qualified Use Personal Property

You must have held the relinquished personal property for rental, investment or use in your trade or business, and must have the intent to hold the like-kind replacement personal property for rental, investment or use in his business. Personal property not held for rental, investment or use in your trade or business is not considered to be qualified use personal property and will not qualify for 1031 Exchange treatment.

Agreed but a lot of Parker Collectors could qualify on the "investment" prong of that test.

[George M. Purtill Member #28]

We do 1031 exchanges for real estate alot and I bet I could do a set of forms for Gun sales for people who are upgrading their collections or re-investing the proceeds.