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Subject Author Date
Taxable Event? Joe Lauton 11-16-2007
|--> Re: Taxable Event? Benjamin Yazers...11-17-2007
Posted by Joe Lauton on November 16, 2007, 3:37 pm
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 Is this a taxable event?

Had a business 5-10 years ago - when it ended I simply
stored the scientific equipment since it could not be sold -
even as junk.

This last year I sold several batches at various prices from
$300 to $800.

The purchaser may send me a 1099 (to cover their behind in
some manner).

Can I just ignore this 'income' on my tax returns?

thanks

jl

Moderator:
Ignore it ONLY if you want to pay penalties and interest
in addition to the tax.

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Posted by Benjamin Yazersky CPA on November 17, 2007, 2:05 am
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> Is this a taxable event?
>
> Had a business 5-10 years ago - when it ended I simply
> stored the scientific equipment since it could not be sold -
> even as junk.
>
> This last year I sold several batches at various prices from
> $300 to $800.
>
> The purchaser may send me a 1099 (to cover their behind in
> some manner).
>
> Can I just ignore this 'income' on my tax returns?

> Moderator:
> Ignore it ONLY if you want to pay penalties and interest
> in addition to the tax.

To reiterate the comment of the moderator...
ignore it at your own risk

You have to address it.

___________________________________
<<< Benjamin Yazersky, CPA [NJ & NY] >>>
-----> real address on hobokeni or hobokenx <-----

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Bill on November 17, 2007, 6:54 pm
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JL@Lauton2000.com (Joe=A0Lauton) posted:

> Is this a taxable event?
> Had a business 5-10 years ago - when it
> ended I simply stored the scientific equipment
> since it could not be sold - even as junk.
> This last year I sold several batches at various
> prices from $300 to $800.
> The purchaser may send me a 1099 (to cover
> their behind in some manner).
> Can I just ignore this 'income' on my tax
> returns?

Assuming this "business" you had was a sole proprietorship,
your ownership of the equipment could (IMHO) legitimately
include an extended cost basis.

Assuming you had records of the original cost of those
items, you could enter the 1099 data on a Schedule D --
itemizing as appropriate -- and show the actual cost basis
and pruchase date.

If, as is more likely, you no longer have records of the
actual purchase date and cost of the individual items, it
would be reasonable to show an approximate date of purchase
and at least estimate their cost basis as the current value
(or same as the amounts received) -- thus erasing any gain.

In the unlikely event any of these items actually increased
in value over your original cost, then you ought to report
the gain.

Bill

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Harlan Lunsford on November 19, 2007, 6:10 pm
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Bill wrote:
> JL@Lauton2000.com (Joe=A0Lauton) posted:

>> Is this a taxable event?
>> Had a business 5-10 years ago - when it
>> ended I simply stored the scientific equipment
>> since it could not be sold - even as junk.
>> This last year I sold several batches at various
>> prices from $300 to $800.
>> The purchaser may send me a 1099 (to cover
>> their behind in some manner).
>> Can I just ignore this 'income' on my tax
>> returns?

> Assuming this "business" you had was a sole proprietorship,
> your ownership of the equipment could (IMHO) legitimately
> include an extended cost basis.
>
> Assuming you had records of the original cost of those
> items, you could enter the 1099 data on a Schedule D --
> itemizing as appropriate -- and show the actual cost basis
> and pruchase date.
>
> If, as is more likely, you no longer have records of the
> actual purchase date and cost of the individual items, it
> would be reasonable to show an approximate date of purchase
> and at least estimate their cost basis as the current value
> (or same as the amounts received) -- thus erasing any gain.
>
> In the unlikely event any of these items actually increased
> in value over your original cost, then you ought to report
> the gain.

it is of course possible that such basis exists. And that
basis would be the tax book value of said equipment or FMV,
whichever is lower. Of course if the section179 had been
used for that equipment, basis is naturally zero.

The only possible basis at this time however is zero, in the
absence of records. Result = taxable.

ChEAr$,
Harlan Lunsford, EA n LA

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Joe Lauton on November 19, 2007, 6:10 pm
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an_ordinary_guy_158@hotmail.com (Bill) wrote:
> JL@Lauton2000.com (Joe=A0Lauton) posted:

>> Is this a taxable event?
>> Had a business 5-10 years ago - when it
>> ended I simply stored the scientific equipment
>> since it could not be sold - even as junk.
>> This last year I sold several batches at various
>> prices from $300 to $800.
>> The purchaser may send me a 1099 (to cover
>> their behind in some manner).
>> Can I just ignore this 'income' on my tax
>> returns?

> Assuming this "business" you had was a sole proprietorship,
> your ownership of the equipment could (IMHO) legitimately
> include an extended cost basis.
>
> Assuming you had records of the original cost of those
> items, you could enter the 1099 data on a Schedule D --
> itemizing as appropriate -- and show the actual cost basis
> and pruchase date.
>
> If, as is more likely, you no longer have records of the
> actual purchase date and cost of the individual items, it
> would be reasonable to show an approximate date of purchase
> and at least estimate their cost basis as the current value
> (or same as the amounts received) -- thus erasing any gain.
>
> In the unlikely event any of these items actually increased
> in value over your original cost, then you ought to report
> the gain.

Are you proposing that I write this off a second time? It
was generally expensed in the year purchased - many years
ago. I would feel better about assessing storage costs
since the business ended.

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

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