Tax efficient profits? | CBCS Comics

It's like the Roach Motel for comic collectors. 1.84K	1.84K chester15 private msg quote post Address this user	plus 1 plus 1 plus 1 8
	A lot of it is up to interpretation in this gray area. You make your assertions, make your case as to why you believe an item is a collectible or not, and hope they are convinced. Be prepared that they can rule against you. It's much the same as when you take certain deductions - they may agree with you that it is legit and allow it, or rule it out. If you have comics that are your "stock in trade", as in a comic store, pretty much everything you have is general inventory. It likely wouldn't be counted as the sale of collectibles vs. the sale of your general inventory. You buy it, you put it up for sale, it's not your fault it doesn't sell right away. You didn't buy it for the long term, even though it may end up that way. Someone could have bought it day 1, but didn't. The government is looking to penalize the true collectors, sort of. Not really penalize, but certainly not providing favored tax status like some investments receive. They don't like money tied up in artwork, collections, etc. hanging on a wall, stored in boxes, that could be used to keep the economy moving. They tax it at a higher rate if they can, to discourage investments in those areas. They want you to invest in growth companies, tangible goods that are manufactured, putting people to work. Or service industries that provide good jobs for trained individuals. Or real estate that provides construction jobs and housing.
	3 years ago	Post 31 • IP flag post

Quote:

Originally Posted by BrianGreensnips
For ebay sales, when did the tax over $600. Become effective? I pulled all by comics off of e bay but left most of my prints up for sale on ebay.

Hopefully everyone understands this clearly. There is no change in the tax obligations, what's changing is the reporting requirements. Previously you could sell up to $20,000 in a year on platforms such as Ebay and it was up to you to report that information to the IRS. Now Ebay and other platforms are required to provide the IRS with information on anyone who sold over $600 on their platform in a year. So it's not like money will be deducted from your sales or anything, but you will need to show it as income when you file your tax return...otherwise your tax return will not match up with information that the IRS already has. For those of us doing small numbers, our accountant will probably be able to negate 80% of it with offsetting expenses. Those claimed expenses will only get questioned in the off chance that you get audited. That's where it will be important to have records...or at the very least to not have claimed expenses that can be proven to be untrue.

I live in RI and Rhode Islanders eat chili with beans. 92.08K	92.08K esaravo private msg quote post Address this user	plus 1 plus 1 plus 1 6
	Don’t most assets depreciate in value? You would expect most collectibles to appreciate.
	3 years ago	Post 26 • IP flag post

Suck it up, buttercup!! 28.5K	28.5K KatKomics private msg quote post Address this user	plus 1 plus 1 plus 1 10
	You guys could move to Canada? No tax on sales unless over $1000 (for an item not in total) and then you only pay on the amount over $1000. So $1500 you would pay on $500 This is for personal items (comics fall into that) like at a yard sale you would pay no tax on anything because it is unlikely any 1 item you would charge over the $1k Hmmm....maybe I found some extra income here....I could "sell" your books - not pay any tax up here in Canada and just take a small "fee" for the service oh! and I think you self report - no one is sending this info to our tax authority!
	3 years ago	Post 27 • IP flag post

Masculinity takes a holiday. 36.66K	36.66K EbayMafia private msg quote post Address this user	plus 1 plus 1 plus 1 0
	Quote: Originally Posted by esaravo Don’t most assets depreciate in value? You would expect most collectibles to appreciate. This could explain the unusual tax situation of higher rates for long-term and lower rates for short-term. Dealers who buy and sell the same collectible within 12 months don't pay the big premium. Those who hold for value appreciation pay a much higher rate. Typically capital gains rates would be the opposite, but that's for investment in companies through stock purchases.
	3 years ago	Post 28 • IP flag post

Masculinity takes a holiday. 36.66K	36.66K EbayMafia private msg quote post Address this user	plus 1 plus 1 plus 1 1
	What seems strange to me is that an owner of a LCS who deals in back issues would have to separate his revenue into three categories for taxation purposes. There would be normal revenue on new items, short-term collectibles and then long-term collectibles. Seems it would be almost impossible to expect sales associates to even ring up sales in a way that could be properly accounted for. I suspect the collectibles tax rate is one of those things that is so messy it's rarely enforced on small timers.
	3 years ago	Post 30 • IP flag post

Collector 14.51K	14.51K BrianGreensnips private msg quote post Address this user	plus 1 plus 1 plus 1 0
	For ebay sales, when did the tax over $600. Become effective? I pulled all by comics off of e bay but left most of my prints up for sale on ebay.
	3 years ago	Post 32 • IP flag post

The apple sauce and pudding were the best part... 36.65K	36.65K Bronte private msg quote post Address this user	plus 1 plus 1 plus 1 1
	@BrianGreensnips It starts nationwide this coming year. In a few states it is already in effect.
	3 years ago	Post 33 • IP flag post

Collector 14.51K	14.51K BrianGreensnips private msg quote post Address this user	plus 1 plus 1 plus 1 3
	@Bronte Thanks.
	3 years ago	Post 34 • IP flag post

Collector* 10.54K	10.54K Towmater private msg quote post Address this user	plus 1 plus 1 plus 1 3
	Quote: Originally Posted by EbayMafia Quote: Originally Posted by Bronte 20k / 200 books was reasonable in my opinion. But the 2022 is like 600$ bux total. So I don't think that argument will fly. I sincerely hope I'm wrong, but only time will tell. @Bronte I think we are talking about 2 different things. You're referring to the IRS reporting requirement which has dropped from $20K to $600. I'm referring to the tax percentage that will be paid on those reported sales. People are saying that collectibles get taxed by the Federal Government at 40% but I'm pretty sure it would just be taxed as normal income (which for many of us is in the 20% range) if it's an ongoing enterprise and not just a one-off sale of a collectible. Talk to an accountant/CPA. I was advised a maximum of 28%. Also, a meeting with a CPA allows one to get their paperwork in order and to plan tax strategies.
	3 years ago	Post 35 • IP flag post

Tax efficient profits?14814