- quote -

of course individuals allocate. If you go in one day and
buy a chair for $100, and go in another day and buy a chair
for $80, the first chair has a basis of $100, and the second
chair has a basis of $80.

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"Harlan Lunsford" <hlunsford[at]bellsouth.net> wrote:
- quote -

I don't know what Emily Post would say, but this is what the
IRS says (and which has been discussed on MTM numerous
times):

"if you give gifts in the course of your trade or business,
you can deduct all or part of the cost. This chapter
explains the limits and rules for deducting the costs of
gifts.

$25 limit. You can deduct no more than $25 for business
gifts you give directly or indirectly to any one person
during your tax year. A gift to a company that is intended
for the eventual personal use or benefit of a particular
person or a limited class of people will be considered an
indirect gift to that particular person or to the
individuals within that class of people who receive the
gift." (pub 463)

what is the basis of the recipient of such a gift? See pub
551, "FMV Less Than Donor's Adjusted Basis".

it seems the donor's adjusted basis is H.D.'s cost, so you
will have a gain of your sale price less H.D.'s cost for
those gifted chairs.

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Seth Breidbart wrote:

- quote -

Looks like we're to a point where we need to define what is
a gift.

Does a gift require the intention of the givor? (notice I
didn't say giftor.)

Or can not a gift be implied from the events themselves?

Does the receivor (notice I did not say "giftee") have to
ackknowledge the gift?

what would Emily Post say?

ChEAr$,
Harlan Lunsford, EA in LA
Independence Day, July 4, 2006

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You pay for 4 chairs, they promise to ship 4. Sounds like a
contract.

They ship 8 chairs. Sounds like a mistake or
misunderstanding -- your status at this point unclear.

They say, hell, keep 'em all; too much trouble to reship.
Could sound like a gift of 4 chairs-- or a revised contract
for 8. Might argue this one either way.

They say nothing, never contact you. In this case, maybe a
gift to you, maybe "found objects", maybe a revised
contract. I'd probably argue for the final interpretation,
maybe the second, but not the first, because although it's
like a gift to you, it's not clear *they* ever knowingly
made such a gift.

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- quote -

When a store makes a "gift" as part of a sale transaction, I
don't consider it a true gift, but rather a promotional
transaction or the like.

Seth

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Ernie Klein wrote:

- quote -

Great! here is the identical same case.

I still have not been contacted by Home Depot requestion
return of the chairs, nor by the manufacturer. Let them
fight it out.

Meanwhile, what am I bid?

ChEAr$,
Harlan

Moderator: Sight unseen?

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Stuart A. Bronstein wrote:
- quote -

Did I mention that Home Depot had the chair drop shipped from
manufacturer?

That was the foul up, the manufacturer shipped four "units"
(2 to a box) instead of four chairs. Now it gets
interesting in that IF HD realizes that they're about to pay
the manufacturer for 8 chairs, what happens?

As Lou Costello said, 'I don't KNOW, and I don't care!" grin

ChEAr$,
Harlan

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- quote -

I agree, Dick.

BTW, I even drank a Rusty Nail in your memory one night on
board the ship. Somewhere along about... Prince William
Sound I think.

ChEAr$,
Harlan

Moderator: Thanks, What a guy?

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- quote -

Not a chance, Gil. In fact I'm even selling my Home Depot
stock. If they can't keep inventory right, and if they can't
do the stock options routine better than what they've done so
far, and if they keep paying their executives too much,......
no hope.

ChEAr$,
Harlan

Moderator:
You're the only person I can imagine who would sell his
HD stock over this. The problem is their inventory system
is run by products of that superior northern education
system.

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- quote -

But Seth, I didna buy the extra four chairs. they were
a gift.

ChEAr$,
Harlan

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Seth Breidbart wrote:
- quote -

I haven't even read to the end of the thread and already I'm
glad I posted this one. You see, I did that right before I
went away for two weeks on the Big Boat to Alaska.

anyway, after all, the IRS wouldn't care, because as we all
know, the 8 chairs are F U N G I B L E! (grin)

Oh man, this was good.

And it happened to me.

now, what am I offered for four chairs?

ChEAr$,
Harlan

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Stuart A. Bronstein <spamtrap[at]lexregia.com> wrote:
- quote -

But in the chairs case, the store sent the extra chairs, and
told him they were his. How is that not an unadvertised
"buy 1 get 1 free" sale?

Does it differ in any way from the "have some extra, you're
a good customer" example? Why?

Seth

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Arthur Kamlet <ArtKamlet[at]aol.REMOVE.com> wrote:
- quote -

I would think so.

Those are both actual gifts.

If, in addition, your uncle gave you a check for $12,000
that year, he'd have to file a gift tax return.

On the other hand, the contractor made an _error_. He did
not intentionally provide a gift. Even if the value of the
driveway were $15,000, he wouldn't have to file a gift tax
return. Rather, I'd think that his costs in installing the
incorrect driveway would be deductible as a business
expense.

(In general, an "oops" that's part of an
otherwise-deductible situation is itself deductible. If you
take a wrong turn travelling on business, you can still
deduct the actual mileage travelled.)

Seth

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Seth Breidbart <sethb[at]panix.com> wrote:

- quote -

Suppose your rich uncle decided to be very nice to you and
with your OK, arranged and paid a contractor to install a
patterned cement drivemay for you.

Or maybe he paid you and asked you to pay the contractor.

Are these equivalent?

They are both gifts. But in one case you received a gift
and used it to pay for the driveway, and in the other, you
paid nothing but one day this driveway showed up.

Would basis increase the same in each case?

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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"Stuart A. Bronstein" <spamtrap[at]lexregia.com> wrote:
- quote -

How about the other side of the coin?

My neighbor ordered and received some very large and expensive
windows from who else - Home Depot. A few days after the
shipment arrived, a second duplicate shipment arrived. That
was months ago. All attempts to return the windows to either
Home Depot or the manufacture has been met with indifference.
Home Depot has told him flat out that it does *not* want the
windows and it is the manufactures problem. The manufacture
says that it is Home Depot's problem and Home Depot has paid
for the windows.

The problem? These large windows are taking up a good deal
of the floor space in his garage. He hasn't even been able
to give them away as they are built for a specific application.
He doesn't want to store the windows forever free of charge
and he doesn't want to have to pay to have them hauled away
(the local landfill will charge an arm and a leg to dispose of
these large windows).

So here is a case when a double delivery is actually a
liability and not an asset and will probably end up costing
my neighbor a fair amount of time and money before it is over.

--
-Ernie-

Moderator:
Have your neighbor post the availability of these windows
to alt.home.repair which is an excellent newsgroup. If he
gets no takers, he should go to freecycle.org, find some
local freecycle groups and post it there. If all else
fails, he should try craigslist.

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Stuart A. Bronstein <spamtrap[at]lexregia.com> wrote:
- quote -

No; the stolen four are income (if the store doesn't claim
them back).

But here the other four were a "free" bonus for buying the
first four. To me, that means they share the basis.

Seth

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Dick Adams <rdadams[at]smart.net)> wrote:

- quote -

What do you mean, "adds to your basis"? Surely your basis didn't
change, your _value_ did.

Seth

Moderator: I stand corrected.

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rdadams[at]smart.net) (Dick Adams) writes:

- quote -

How much does it add to your basis?

Dan Lanciani
ddl[at]danlan.*com

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sethb[at]panix.com (Seth Breidbart) wrote:
- quote -

Are you saying the tax effect would be the same if he had
bought four and stolen another four?

Stu

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"Gil Favor" <rowdysboss[at]heademup.com> wrote:
- quote -

Of course, treasure trove does not fit. It certainly was not
a gift. It's more like you came home to find your dirt driveway
had been replaced with patterned concrete driveway due to a
misread address. You owe nothing, but it adds to your basis.

Dick

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