How good is your record keeping?

Can you prove your cost basis if the IRS questions your tax return? Has anyone here had to deal with the sell of coins on your tax return?

 

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I make an effort, but this is a hobby, and my hobby is coins, not accounting. I'm sure a fine-grained audit would be super-painful, even though I've reported gains on my taxes with the most accurate figures I could gather.

 

I keep my collection in a spreadsheet. One column is for the purchase price, date, and seller, although stuff that pre-dates the spreadsheet isn't always known.

Like Jeff, this is my hobby so I don't sweat it too much. If I had a high-dollar collection I might pay more attention but I don't.

 

I really don't know why I open these threads. As a businessman, I am the most meticulous record keeper alive.... As a hobbyist, not only do I keep lousy records... I keep zero coin records..... Man, I need to do something about that.

 

to me this is just a hobby nothing more and i'm fair with record keeping as for the IRS i let the experts deal with that

 

What coins? I don't have any coins? Who told you I had coins?

 

In 1948 my aunt gave me an 1885 nickel. It showed as having a value of $5 at the time. If I sold it today I would make a big profit, or is it? About 1953 I received a Twenty Cent piece in change. If I sold it today I would make a big profit, or is it? My entire 75 years of collecting is represented by hundreds (thousands) of similar scenarios. And, those items that I may have records of (mint sets, proof sets, commemoratives and other products of the US Mint) have lost value. I may have to take the collection to the other side of my lake and hope the boat doesn't tip over.

 

I write everything by hand on index cards even the Ebay transaction number. I also have a code on the flip cards I can use to figure out what I paid for something. I also take pics of everything and store them on external hard drive. Everything on the external is backed up on 10 flash drives.

 

Ditto+1

 

Receipts for everything. All data entered into Excel. Photos of everything tied back to listings in Excel. All computer files backed up on external hard disc. Thinking about switching my optical 1TB external drive to an external 2TB SSD. Did that with the laptop's hard drive a couple of months ago. Much more reliable.

Totally a-retentive. Will it mean anything in the future? Who knows. But it isn't any real additional effort since I don't buy thousands of coins a year, more like a hundred to two hundred.

 

My record keeping is great! I've got a slew of 12" singles, 33 1/3 long play, some 45s and even a few 78s!

 

Who wants to know?
Honestly I hate paperwork.

 

How's my record keeping?

I yearn to aspire to the ranks of pathetic.
I began collecting ~55 years ago. I was 8-9 years old. My grandmother got me started with some IHC, pre-64 dimes and quarters, and a few Buffalo nickels.

The record keeping I wish I had would be some Kodak pictures of me and my granny working with those coins. Not some spreadsheet ID'ing the minutiae of the cost basis.

Then add the additional hobby related acquisitions throughout my preteen and teen years. Yeah, I aspire to reach the height of laughable in regards to record keeping.

I'll let my kids and grandkids worry about cost basis on the day I depart this party. That'll be their acquisition cost anyway.

 

For those who keep electronic records with back ups. A tip I leaned from pro photographers is to keep the backups at another location. If the house burns to the ground or a similar total loss your records will be safe at your off site location. Fingers crossed that this will not happen to anyone of course.

 

I have kept the receipts for everything that had one. But, I've always kept track of the purchase date and price, with a link to the auction archives as much as possible.

I do also have a column for the inflation adjusted purchase price, for my own curiosity.

 

Inflation adjusted to what date?
Updated for inflation how often?
Adjusted for deflation of prices as well?

Just seems like that adjustment would be akin to a dog chasing its own tail.

 

I have no plans to sell any coins, let alone those that would trigger a big enough capital gain/tax issue. Even the coins I have traded for other coins aren't noteworthy to the IRS. Whoever inherits the damn things will get the step up/down in basis so that is pretty easy for them to establish if they sell.

Receipts!? I've never seen a dealer that provides receipts (both at show and in B&M shops).

 

I’m not even positive what I own and you expect me to know what I paid for it!?!

 

About 7 out of 10 show dealers I buy from volunteer a receipt. Of the remaining 3, 2 of them will give a receipt if asked. The last one is usually grudging or won't/can't give a receipt. Those guys will always be smaller dealers with a large inventory of raw coins. I can usually get a business card to write down the details. If nothing works, I have a pen and a pad of paper.

 

Like others have mentioned, I too keep a running spreadsheet of my inventory that includes the purchase price, vendor, and date procured.

What I have not done is captured sell/trade amounts. I only delete them from the spreadsheet/registry.

The higher dollar pieces I own I do not intend to sell. Instead, they’ll go to the boy along with the spreadsheet when my time is up. It’s a running joke around here for a lot of years. I’ll ask the kid when he comes over “Wanna see your newest coin?”….and the wife rolls her eyes.