Quote:
Originally Posted by packs
Not sure. If you don't sell the ball how is the market value determined? What if you paid taxes and then later sold the ball for more? Or less? Can you tax sentimental values?
|
Found this relating to Barry Bonds' "756th" home run ball...
By most estimates, the ball that put Bonds atop the list of all-time home run hitters with 756 would sell in the half-million dollar range on the open market or at auction.
That would instantly put [the fan who came up with the ball, Matt Murphy,] in the highest tax bracket for individual income, where he would face a tax rate of about 35 percent, or about $210,000 on a $600,000 ball.
"It's an expensive catch," said John Barrie, a veteran tax lawyer with Bryan Cave LLP in New York who grew up watching the Giants play at Candlestick Park. "Once he took possession of the ball and it was his ball, it was income to him based on its value as of yesterday,"
Even if he does not sell the ball, Murphy would still owe the taxes based on a reasonable estimate of its value, according to Barrie. Capital gains taxes also could be levied in the future as the ball gains value, he said.
(Underlining added by me. Source: ESPN post, August 9, 2007.)
For the record, I don't think
any of this stuff should be taxed unless, and until, the item actually gets sold. Fans who catch ordinary foul balls, or balls that are tossed into the stands by players and coaches, aren't taxed on those balls' value. (And these balls do have value, because some teams sell game-used balls to fans in their team stores.) So a fan who catches a milestone ball should also get it for "free," unless and until he decides to sell it.
But I also believe in fair, equal treatment. So if a fan who catches a milestone ball is immediately responsible for paying taxes on it, then - as a Mets fan, I feel weird saying this, especially because Johan Santana seems like a nice guy - it's only fair that Johan Santana, or the New York Mets, or whoever actually "owns" the ball, should be equally responsible for a similar tax liability.