Whoulda Thought This?

[Conan71]

Catching Barry Bond's #756 might cost the "lucky" guy a small fortune in taxes:

Yahoo Sports

That's a huge bummer.  They can tax him based on the newly enhanced value of the $4.00 baseball (or whatever they cost) for doing nothing more than catching it- not even selling it.

That's seriously screwed up.

[Ed W]

I'm not well acquainted with the tax code, but would this guy be better off donating the ball to a charity so they could auction it, and then take that amount off his taxes?

[Conan71]

Well, except for the fact that he's a college student and likely doesn't earn crap to start with at this point, he may not really have any significant taxes to pay other than the baseball.  I'm just guessing that if he could afford to keep it and pay the taxes, he likely comes from a pretty well-heeled family.  Other things in the story seem to point to that idea.

If I got stuck with it, I'd hang onto it for a few months to get a bidding war going then cash out, pay my taxes, and put my scrap book from all the news interest of the event back on the shelf.  $500K to $600K even under the dubious circumstances of Bonds' obvious possible steroid usage? I think it's worth closer to a mil or more.  The possible scandal may give it that much more trivial value to some collector.

Isn't a Shoeless Joe Jackson card pretty valuable these days?

[Wingnut]

What a rip!
Taxing someone on the possible increased value of something. Do they do that with homes in California? If someone bought a house in California years ago for $30K and now it's worth $500K, do they bill the owner for the taxes on the possible value of the home?? I don't think so.
Not until he sells!

[tulsacyclist]

That is some BS for sure.

[billintulsa]

It is the same thing that "prize winners" go through on game shows, or winning contests on radio stations.  

If, for instance, a person wins a car that is valued at $40,000, then the IRS considers that person's income to have been increased by 40 grand and must pay taxes on that amount.  (The tax bill would be around 13 thousand dollars.)

[cannon_fodder]

But Bill, the car has a readily assessable value.  It's easy to say 2007 Mustang - $28,000.

Who is to say how much the ball is worth?  Depends on how well the auction goes I suppose.  Many times things at auction go for 50%+/- or even double the value.  Or sometimes they fold flat and don't even get the starting bid.  Baseball is decreasing in popularity, Bonds record is tarnished, the markets are in decline... maybe it wont muster a huge bid.  THEN again, there is still a ton of wealth in the markets, it is a huge record, the controversy makes it more publicized...

Taxing potential gains is a VERY dangerous and stupid game for the federal government to play.  Wait until he realizes it, then steal his money.

[Conan71]

According to Academy Sports, a Rawlings "official" baseball is $1.49.  Let's assume there is something special about the official MLB ball used in play and they cost $10.00.  I don't have a clue who the official supplier is to MLB and don't have the time to dig.

He should only be taxed on a capital gain realized by selling it.  The value truly is in question until it actually changes hands and I think it's wrong for the government to tax based on speculative values of just being in possession of something.  

Agreeing w/ CF, couldn't be any dissimilar to a game show prize as there is an established retail value to those prizes.  Anyone with the money can go buy those at a fixed price at any number of places.