Can someone explain this tax law?

guybrush threepwoodguybrush threepwood
Posted:
in AppleOutsider edited January 2014
Everyone is aware of Barry Bonds' record breaking 756 homerun. But beyond that, a 21-year old kid from Queens, NY caught it and is holding it up for auction. He "claims" he wants to keep it but is unable to because the taxes on it would be too much to afford.



I'm pretty clueless when it comes to tax laws, but in this case I'm even more confused in the fact that before this ball was caught, the value of the ball was extemely low. He hasn't gotten it appraised, so how could he be taxed on something that has no specific value yet?



Is he forced to put a value on the ball? And how can the IRS determine a value of a ball if it hasn't been appraised?



Here's a link to the article. None of the sports articles go into detail of the tax laws, which is why I'm asking on here.



http://sports.yahoo.com/mlb/news?slu...yhoo&type=lgns

Comments

  • Reply 1 of 4
    @_@ artman@_@ artman Posts: 5,231member
    The Big Catch Could Have A Big Catch
  • Reply 2 of 4
    guybrush threepwoodguybrush threepwood Posts: 1,109member
    I guess I should stop reading layman-ass news sources and put more effort into my searches.



    Thanks, Art...
  • Reply 3 of 4
    sdw2001sdw2001 Posts: 18,039member
    So basically the answer is that no one really knows...not even the IRS. I frankly don't see how there could be any reasonable case for the person being taxed before selling the ball.



    First, the particular baseball was not a gift and was not "given" to him by a party intentionally. It was "found" by chance. Secondly, the value of the ball cannot really be determined without actually selling it. It's also potentially subjective and highly variable. The individual could claim that to him, the ball is not for sale and has no significant monetary value. Most importantly, the precedent set by such a case would be very troubling.

    The IRS could claim that ANYTHING a person is given has inherent monetary value and should be taxed as such. Think about it. You paint something for your grandmother and give it to her. Can the IRS estimate its worth and tax her on it? Your girlfriend writes you a love letter. You break up, and she becomes a famous movie star. Can the IRS claim that you owe taxes on the love letter because if it was sold it would have potential monetary value?



    This is exactly why you don't ask questions like this when you catch the ball. The IRS is obviously not going to touch the case, so seems like keeping one's fool mouth shut would be a good idea.
  • Reply 4 of 4
    shawnjshawnj Posts: 6,656member
    Quote:
    Originally Posted by SDW2001 View Post


    First, the particular baseball was not a gift and was not "given" to him by a party intentionally. It was "found" by chance.



    That's probably not a legally relevant distinction in terms of what's taxable.



    Quote:
    Originally Posted by SDW2001 View Post


    Secondly, the value of the ball cannot really be determined without actually selling it. It's also potentially subjective and highly variable. The individual could claim that to him, the ball is not for sale and has no significant monetary value.



    Fair market value at the time of the assessment, I'm guessing.



    Tax law is next semester.



    Joy.



    Quote:
    Originally Posted by SDW2001 View Post


    Most importantly, the precedent set by such a case would be very troubling. The IRS could claim that ANYTHING a person is given has inherent monetary value and should be taxed as such. Think about it. You paint something for your grandmother and give it to her. Can the IRS estimate its worth and tax her on it?



    That only holds sentimental value.



    Quote:
    Originally Posted by SDW2001 View Post


    Your girlfriend writes you a love letter. You break up, and she becomes a famous movie star. Can the IRS claim that you owe taxes on the love letter because if it was sold it would have potential monetary value?



    Tougher example.



    Couldn't say.



    Quote:
    Originally Posted by SDW2001 View Post


    This is exactly why you don't ask questions like this when you catch the ball. The IRS is obviously not going to touch the case, so seems like keeping one's fool mouth shut would be a good idea.



    Yeah, it's probably not going anywhere.
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