Subject:
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Re: Taxes from Lego auctions?
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Newsgroups:
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lugnet.market.theory
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Date:
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Wed, 5 Apr 2000 16:51:09 GMT
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> Should a Lego collector claim sets s/he sells on ebay or serious collector or
> anywhere else on their taxes? I don't see a point in doing that if let's say
> I buy some lego sets for 1,000 bucks, build a couple creations with them, then
> sell them for 1,000 bucks and use the money to buy other lego sets? There is
> no income here and the hours of labor put into disassembling, sorting,
> building and packaging the sets would come up to a loss, not profit.
I gave the IRS a call about this since (as I'm sure most of you are aware) it's
tax time and I wanted to know what to do with Lego income. The basic answer is
that profits from selling sets (or parts) should be counted as capital gains,
short-term or long term depending on how long you held the sets. By my
understanding, capital gains taxes apply not only to stocks (the archetypical
capital gain vehicle), but to any property held for personal use or investment
which is sold for a profit. This would seem to apply to most of the selling
that goes on here (or selling by most of the people who sell here might be a
more accurate way to say it--I assume that some of the big sellers would fall
under a business rather than personal/investment income situation). See
http://www.irs.gov/forms_pubs/pubs/p5500407.htm for a little more explanation
of capital gains.
Standard disclaimer--I'm not a professional in this area, and the IRS doesn't
guarantee that they'll answer questions correctly when you call them (only that
they won't nail you with penalties if they give a wrong answer). Do a little
research yourself, ask an accountant, or give the IRS a call--don't take my
word for it.
Alan
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Message has 1 Reply:
 | | Re: Taxes from Lego auctions?
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| (...) One point on the above - (in the US [and remember, IANAL]) you don't get to deduct the hours you spend (though if you paid some kid to dissassemble and sort the parts, then you could deduct that expense). (24 years ago, 5-Apr-00, to lugnet.market.theory)
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Message is in Reply To:
| | Taxes from Lego auctions?
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| I have been thinking about this issue for a long time and the recent discussions about states going after auctioneers and fining them made me wonder... Should a Lego collector claim sets s/he sells on ebay or serious collector or anywhere else on (...) (25 years ago, 17-Dec-99, to lugnet.market.theory)
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