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Can my wife buy my asset so I get a capital loss?
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Confused
Jan 22, 2012, 8:12:46 PM1/22/12
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Years ago I lent someone money, secured by jewelry. He defaulted and
I got the jewelry. At the time I was covered, but the market has
declined so I am out about 50%. I have given the jewelry to a jeweler
who is selling it off very slowly. I understand I cannot take a loss
until it is all sold.
Could my wife buy it at a fair market value so I can take the loss? I
would be out the sales tax, but it would be worth it. We file a joint
return, but I own it.
I have absolutely NO interest in anything the IRS is going to give me
a hard time over.
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I got the jewelry. At the time I was covered, but the market has
declined so I am out about 50%. I have given the jewelry to a jeweler
who is selling it off very slowly. I understand I cannot take a loss
until it is all sold.
Could my wife buy it at a fair market value so I can take the loss? I
would be out the sales tax, but it would be worth it. We file a joint
return, but I own it.
I have absolutely NO interest in anything the IRS is going to give me
a hard time over.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>
Dick Adams
Jan 22, 2012, 8:38:24 PM1/22/12
to
Confused <wa...@lippman.info> wrote:
> Years ago I lent someone money, secured by jewelry. He defaulted
> and I got the jewelry. At the time I was covered, but the market
> has declined so I am out about 50%. I have given the jewelry to
> a jeweler who is selling it off very slowly. I understand I
> cannot take a loss until it is all sold.
>
> Could my wife buy it at a fair market value so I can take the
> loss? I would be out the sales tax, but it would be worth it.
> We file a joint return, but I own it.
>
> I have absolutely NO interest in anything the IRS is going to
> give me a hard time over.
You have yet to exhaust your remedies - like Craigslist, Ebay,
> Years ago I lent someone money, secured by jewelry. He defaulted
> and I got the jewelry. At the time I was covered, but the market
> has declined so I am out about 50%. I have given the jewelry to
> a jeweler who is selling it off very slowly. I understand I
> cannot take a loss until it is all sold.
>
> Could my wife buy it at a fair market value so I can take the
> loss? I would be out the sales tax, but it would be worth it.
> We file a joint return, but I own it.
>
> I have absolutely NO interest in anything the IRS is going to
> give me a hard time over.
etc. I agree it's not fair, but what is?
As for your wife buying it, that's a relaed party transaction,
the equivalent of a wash sale, and might be considered to be
what the IRS call a Badge of Fraud.
My advice is "Don't think about it further."
Dick
removep...@yahoo.com
Jan 23, 2012, 8:45:08 PM1/23/12
to
On Jan 22, 5:12 pm, Confused <w...@lippman.info> wrote:
> Years ago I lent someone money, secured by jewelry. He defaulted and
> I got the jewelry. At the time I was covered, but the market has
> declined so I am out about 50%. I have given the jewelry to a jeweler
> who is selling it off very slowly. I understand I cannot take a loss
> until it is all sold.
Why can't you take a loss as each piece is sold? I think this is
> Years ago I lent someone money, secured by jewelry. He defaulted and
> I got the jewelry. At the time I was covered, but the market has
> declined so I am out about 50%. I have given the jewelry to a jeweler
> who is selling it off very slowly. I understand I cannot take a loss
> until it is all sold.
doable. If you bought 100 shares of XYZ and sell 10, you take gain/
loss on those 10, then if you sell another 10 you take gain/loss on
this 10 shares sold.
Anyway you can only deduct 3k of loss each year (the rest is carried
over).
> Could my wife buy it at a fair market value so I can take the loss? I
> would be out the sales tax, but it would be worth it. We file a joint
> return, but I own it.
>
> I have absolutely NO interest in anything the IRS is going to give me
> a hard time over.
Stuart A. Bronstein
Jan 24, 2012, 2:40:57 PM1/24/12
to
"removep...@yahoo.com" <removep...@yahoo.com> wrote:
> Confused <w...@lippman.info> wrote:
>
>> Years ago I lent someone money, secured by jewelry. He
>> defaulted and I got the jewelry. At the time I was covered,
>> but the market has declined so I am out about 50%. I have
>> given the jewelry to a jeweler who is selling it off very
>> slowly. I understand I cannot take a loss until it is all
>> sold.
>
> Why can't you take a loss as each piece is sold? I think this
> is doable. If you bought 100 shares of XYZ and sell 10, you
> take gain/ loss on those 10, then if you sell another 10 you
> take gain/loss on this 10 shares sold.
There is a specific, single amount owed and the jewelry is security.
> Confused <w...@lippman.info> wrote:
>
>> Years ago I lent someone money, secured by jewelry. He
>> defaulted and I got the jewelry. At the time I was covered,
>> but the market has declined so I am out about 50%. I have
>> given the jewelry to a jeweler who is selling it off very
>> slowly. I understand I cannot take a loss until it is all
>> sold.
>
> Why can't you take a loss as each piece is sold? I think this
> is doable. If you bought 100 shares of XYZ and sell 10, you
> take gain/ loss on those 10, then if you sell another 10 you
> take gain/loss on this 10 shares sold.
I doubt that the loan could be divided into shares and treated as
separate loans, though you might try it.
To do that OP would have to have each piece appraised as of the date
of the original loan.
___
Stu
http://DownToEarthLawyer.com
removep...@yahoo.com
Jan 25, 2012, 12:27:37 PM1/25/12
to
On Jan 24, 11:40 am, "Stuart A. Bronstein" <spamt...@lexregia.com>
wrote:
> > Why can't you take a loss as each piece is sold? I think this
> > is doable. If you bought 100 shares of XYZ and sell 10, you
> > take gain/ loss on those 10, then if you sell another 10 you
> > take gain/loss on this 10 shares sold.
>
> There is a specific, single amount owed and the jewelry is security.
> I doubt that the loan could be divided into shares and treated as
> separate loans, though you might try it.
>
> To do that OP would have to have each piece appraised as of the date
> of the original loan.
If he was given identical pieces (like someone posted about gems a
while ago) then it would be easy.
wrote:
> > Why can't you take a loss as each piece is sold? I think this
> > is doable. If you bought 100 shares of XYZ and sell 10, you
> > take gain/ loss on those 10, then if you sell another 10 you
> > take gain/loss on this 10 shares sold.
>
> There is a specific, single amount owed and the jewelry is security.
> I doubt that the loan could be divided into shares and treated as
> separate loans, though you might try it.
>
> To do that OP would have to have each piece appraised as of the date
> of the original loan.
while ago) then it would be easy.
Katie in San Diego
Feb 10, 2012, 2:13:37 PM2/10/12
to
On Jan 22, 5:12 pm, Confused <w...@lippman.info> wrote:
> Years ago I lent someone money, secured by jewelry. He defaulted and
> I got the jewelry. At the time I was covered, but the market has
> declined so I am out about 50%. I have given the jewelry to a jeweler
> who is selling it off very slowly. I understand I cannot take a loss
> until it is all sold.
>
> Could my wife buy it at a fair market value so I can take the loss? I
> would be out the sales tax, but it would be worth it. We file a joint
> return, but I own it.
>
> I have absolutely NO interest in anything the IRS is going to give me
> a hard time over.
>
No, you absolutely cannot sell the jewelry to your spouse and
> I got the jewelry. At the time I was covered, but the market has
> declined so I am out about 50%. I have given the jewelry to a jeweler
> who is selling it off very slowly. I understand I cannot take a loss
> until it is all sold.
>
> Could my wife buy it at a fair market value so I can take the loss? I
> would be out the sales tax, but it would be worth it. We file a joint
> return, but I own it.
>
> I have absolutely NO interest in anything the IRS is going to give me
> a hard time over.
>
recognize a loss. IRC Sec. 267(a)(1), (b)(1) and (c)(4).
Katie in San Diego
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