If I sell a coin, that had been in my family for 45 years, via a well known auction house and I received $20,000.00, what would the Long Term Capital Gains be?? My tax bracket is $00.00 --- $13, 500.00 annual income. I do not know what the original cost of the coin was. No receipts exist. There were no seller' fees charged. Would I have to pay 10% of the $20, 000.00 since I am in the the lowest (10%) income bracket? zeke
I would ask an accountant, but here is a relatively straightforward explanation about Collectibles and the Taxpayer Relief Act of 1997: http://www.bankrate.com/brm/itax/Edit/tips/Stories/collect_taxrelief.asp Check out the last paragraph under the Heirs receive tax benefit section. If this coin was passed down in your family as part of an estate (inheritance), you may not owe any capital gains tax. Again, check with an accountant to be sure. TC
The question in my mind is when was the coin passed into your personal possession, and is there probate or will that indicates the passing. If so, the original value would be the value when you legally obtained the coin I believe. If you obtained it by a will or probate 1 month before you sold it, The difference is value might be little or even negative if other auction records show a decrease. IMO, Jim
There is a US Federal Income Tax provision for this year called the "Zero Percent Capital Gains" if one's income is low enough. It has nothing to do with heirs. It worked for me last year.
Is anyone else wondering what it is that triggers the necessity to file, I mean, what tells the IRS WHAT collectible you have? I ask because I have a household filled with 'collectibles'; in the event I would give away, sell, or will something away, must I be sure to give everyone an original receipt or something? I am speaking of coins, and you name its.. I don't recall ever having to list any of these items at my husbands death.. I don't want to cause problems for people later.. I have just been giving things away.. Sigh...my estate attorney has not mentioned any of these things to me. Thank you. Lucy
Generally, the remaining spouse is assumed to be a co-owner and retains possession after a death, unless the object in question was bequest to someone else, and if the estate is settled . Maybe in your state that is maybe why the estate attorney didn't mention it. You can ask and they could tell you in 5 min.
In most cases the remaining spouse will get a stepped up basis on the part the other spouse owned. It's wise to talk with a lawyer or CPA is your state.
Remember, if there is a capital gain on coins, coins and bullion are almost always treated as "collectibles" by the IRS and the IRS rate on collectibles gain is 28%, even if held for the long-term.
Thank you. I am familiar with step up valuation, date of death or six months later, greater of the two, used on 50%. I'm more in a tither about mention of collectibles.. geez, I just have been giving things away. My attorney and my cpa do in fact look out for me, but most often I find that advice is usually only as good as the questions I am able to ask. The deeper I go, the deeper they go. So thanks for the info, and advice. I am always updating my own plans. Lucy
Well I googled up " zero percent capital gains " and I fit right into that category, like a glove. I'm hoping to use it this year. Thanks everyone for all your inputs. This shouldn't be such a taboo subject. Ignorance is not bliss in this case. zeke
talk to your tax preparer to confirm, but unfortunately it seems the favorable zero-percent rules only apply to "adjust net capital gains" which under the IRS definitions I believe does not include sales of collectibles.
That did not sound good. Hmmm, I'll have to read up on " adjust net capital gains ". Ha, like I would understand it. Thanks Illini420.
