noble_farnsworth[at]yahoo.com wrote:

- quote -

Ok, that puts a whole new spin on this. If this was
originally a gift for her husband, and she got it back when
he died, the basis becomes the value on the date of your
father-in-law's death. An appraiser should be able to tell
you what that is.

- quote -

Cost basis is the value at FIL's date of death. So chances
are your taxible income will be fairly small.

- quote -

Right.

Stu

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

Thanks, Seth, for that helpful clarification. The
distinction is important, and I appreciate it.

Bill

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Bill <an_ordinary_guy_158[at]hotmail.com> wrote:

- quote -

It is a taxable event. However, a loss cannot be taken; and
personal property generally sells for less than cost.

Seth

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Thanks for all the helpful replies, you guys are very good!

Just to fill in some details of the story for anyone who's
interested: The giftor was my mother-in-law at the time.
She bought the books in the 50s for her husband, my
father-in-law, with whom I was very close. When he died in
the early 90s, she gave the books to me. A few years later,
her daughter and I divorced and have not spoken in years.
The giftor died some years ago and even the house she lived
in has been razed.

So, it's impossible to even begin to find out her cost basis
from 50 years ago. Considering the run-up in value of these
sorts of things, I will assume a cost basis of zero and pay
the 28% tax.

I assume that I pay tax only on net proceeds, after
subtracting associated costs (seller's fees, shipping and
insurance, etc.).

Thanks again!

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noble_farnswo...[at]yahoo.com wrote:

- quote -

You pay a special 28% "collectible" capital gain tax on the
increase in value while you held the books. You can ask the
agent what the value would have been when you received the
gift.

If the money is anything but cash in hand, there is a record
of it. You are also creating a record right now on this
newsgroup.

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noble_farnswo...[at]yahoo.com wrote:

- quote -

First, your "cost basis" in this gift IS NOT their value at
the time you received them, but rather the giftor's adjusted
cost basis. That may be what he/she paid for them, received
them as a gift, or something completely different. If you
cannot reasonably determine your cost basis, the IRS default
is -0-, and all proceeds of sale are taxable.

- quote -

Yes, but as 28% "collectibles".

- quote -

You are posting on a PUBLIC forum/user group. You think the
IRS doesn't read these? Playing dumb, alright.

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<noble_farnsworth[at]yahoo.com> wrote:

- quote -

I bet they were worth more when you received them! So, what
profit?

I am just kidding, but it is entirely possible. I got some
gems as collateral on a loan 8 years ago and they are now
worth half of what they were worth then. See if the firm
will provide an estimate of their value 15 years ago.

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<noble_farnsworth[at]yahoo.com> wrote:

- quote -

[selling them]

- quote -

Yes, of collectibles so you don't get the lowest rate.

I don't know how you'd value them back when they were
gifted. Maybe an appraiser would give you an estimate.

Seth

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<noble_farnsworth[at]yahoo.com> wrote
- quote -

Gifts carry the cost basis if the person who gave them to
you, so their value when given to you is not at issue.

- quote -

Yes. But these are collectibles, which get taxed at no more
than 28%, not teh 15% attached to long-term gains of a stock
perhaps.

- quote -

Schedule D.

Do you have any clue as to how the books were acquired by
the person who gave them to you?

If he purchased them, what did they retail for back then?
It'd be tough to prove one way or the other, but if you have
something, it's a starting point that's better than nothing.

--
Paul A. Thomas, CPA
Athens, Georgia

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noble_farnsworth[at]yahoo.com posted:

- quote -

Lucky you. And what a nice gift that was!
The purist answer would, of course, be that you might
consult the "reputable firm" for a professional opinion on
the value of such items at the time of the gift, and use
that for your cost basis when you report the proceeds on
Schedule D, as an "LT" gain.

- quote -

I will watch the professional's responses to this with great
interest. One can take the philosophical position that a
gift is a gift ... and the disposal of personal property is
not normally a taxable event. There is not a _normal_
expectation that items in one's possession will at some time
become highly valued. However, that has certainly been the
case with many people who have "discovered" that the old
item in the attic, inherited from Aunt Susie, turns out to
be worth six figures or more -- when they take it to the
Antiques Road Show.

I don't have any idea -- in my own amateurish "semi-pro"
status -- of what on earth the practice is with those
situations.

So I'll join you in awaiting expert analysis. Meanwhile, I
want to thank you for posting a most _interesting_ question.

Bill

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More than 15 years ago, I was given some old rare books by
someone who is now deceased. I've decided to sell the
books, and will probably net $8K-$10K, perhaps more. The
agent (a reputable firm) selling the books has made a point
of saying they do not report sales to the IRS.

What are the tax consequences? I have no paperwork
associated with the gift, and no idea what their value was
at the time I received them.

Are the net proceeds considered a long term capital gain? I
suppose I could not include it on my return, then if the IRS
discovers the sale I could play dumb, which in this instance
would not be far from the truth. I would like to know the
correct way to treat this, however.

Thanks in advance for comments.

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