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Old March 27, 2010, 07:10 PM   #26
musher
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That'll really help the bottom line in my little business. I was just thinking I needed another bunch of paperwork to do for the feds on my own dime.

I'm wondering how that works out for the casual collector/swapper though. Buy a gun, play with it a while, sell it off to buy another.

Oops--1099 comes in the mail. Do you have paperwork documenting your basis in the gun. Can you subtract the cost of the gun, or do you have to pay taxes on what you sell it for?

Seems like the whole thing can't be good for the licensed dealers. From a consumer's standpoint, it seems a lot easier just to sell on the private market.
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Old March 27, 2010, 07:24 PM   #27
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Correct, it's when a vendor buys from you. If he buys more than $600 from you in a year then he's got to keep records.

What that really means is that he's got to keep records on everyone he buys ANYTHING from so that he will know if he bought more than $600 from any single person in the course of a year.
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Old March 27, 2010, 07:47 PM   #28
Kleinzeit
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Ah, I see. Thanks.
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Old March 27, 2010, 08:30 PM   #29
Tom Servo
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What that really means is that he's got to keep records on everyone he buys ANYTHING from so that he will know if he bought more than $600 from any single person in the course of a year.
Yep, this is ugly, but I don't think it'll survive.

We're not the only business that buys from individuals for resale. Expect jewelry stores, pawn shops, car dealers and music stores to raise Cain about it as well.

We've got 21 months before it goes into effect.
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Old March 27, 2010, 08:42 PM   #30
hogdogs
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Well if this is accurate, here is a possible beginning of positive news...
Seems GOA is right in there trying to protect the privacy of gun owners regarding insurance and health care legislation.
http://bulletin.accurateshooter.com/...e-legislation/
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Old March 28, 2010, 03:34 AM   #31
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I'm way behind on much of this, but can someone educate me on the state's suits (12 last I heard) as they pertain to gun owners and the HCR?
If the states contend that the Gov't cannot force a person to purchase a product or service (insurance) from private individuals, which is still under interstate commerce, then couldn't there be an out option to protect gun owners from further paperwork or intrusion if firearm transactions are conducted within his/her state?
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Old March 28, 2010, 07:19 AM   #32
roy reali
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Taxes?

I don't want to speculate, but I am hearing that value added taxes might be a source of funding for this new medical program. If that happens, it would impact shooting by making it more expensive.
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Old March 28, 2010, 07:55 AM   #33
RDak
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Sure. Sorry about that.

Starts on Page 5, Line 11. Runs through Page 7 I think.

http://democrats.senate.gov/reform/m...-amendment.pdf
Thanks for the info.

Plus, as I'm sure you all know, you will be able to deduct the cost basis of the firearm from the income reported on the Form 1099 Misc. Only the profit would be taxable. (Just a reminder.)

I assume it will be a long term capital gain if held for over one year, just like any other asset, but this is an assumption on my part.

Last edited by RDak; March 28, 2010 at 08:02 AM.
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Old March 29, 2010, 06:14 PM   #34
ursavus.elemensis
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It's not all bad news...
You can deduct the cost of mileage to and from the gun shop !!!
You can deduct the transfer fees if you sell it to someone.
You can deduct the cost of the safe you keep it in before selling it.

For most of us, selling a gun, and filing a schedule C means we can deduct business losses from our real income. This is actually, potentially, quite good...
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Old March 29, 2010, 08:17 PM   #35
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ursavus.elemensis, Actually if you claim "business expenses" involved with your gun sales to shops, I think you need to be an FFL holder ...
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Old March 29, 2010, 09:01 PM   #36
mhuegerich
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RDak,

I was thinking the same thing when I read your post. You should be able to deduct the cost basis of the firearm from the 1099 amount.

Does that mean you'd need an original receipt, or would an appraisal do?
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Old March 30, 2010, 03:30 AM   #37
RDak
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If you purchased it, you'd need an invoice. If you have lost the invoice, the best you could do is try and get an advertisement, catalog, etc., showing how much it cost the year you got it.

If inherited, get the fair market value at the time of inheritance. Use a catalog, advertisement, etc, for the firearm at the time you inherited it.

ETA: An appraisal is great but might be an unnecessary cost to incur except for the most expensive types of firearms IMHO. An FFL could probably help you with this cost basis determination IMHO.

Last edited by RDak; March 30, 2010 at 03:51 AM.
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Old March 30, 2010, 03:32 AM   #38
RDak
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Quote:
It's not all bad news...
You can deduct the cost of mileage to and from the gun shop !!!
You can deduct the transfer fees if you sell it to someone.
You can deduct the cost of the safe you keep it in before selling it.

For most of us, selling a gun, and filing a schedule C means we can deduct business losses from our real income. This is actually, potentially, quite good...
You wouldn't want to do that because that is for sole proprietorships and it would indicate you have a business of selling firearms. Plus, you'd have to pay the 15+ percent self employment tax on any net profits.

Just use the Schedule D to report these transactions. There is a space for deducting the cost basis.

I would imagine alot of these sales will not result in a profit. Being a personal asset, all you could do is reduce the gain to zero because the loss from the sale of personal assets is not an allowable loss for tax purposes.
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