Barry Bonds Baseball

[Dave T]

Saw an article in Money magazine the other day that said Matt (?) Murphy, the man that caught Barry Bonds' historic 756th homerun baseball, was selling it so that he could pay the taxes due on it.

The article went on to say that it would probably fetch upwards of $500K ( this was before someone actually paid over $750K for it).

Had he not chosen to sell it, how would he have declared it and and for what amount?

Dave T

PS - Went to a game last year with my sons and they got a ball hit by a player. Didn't know I had to declare that, although a foul ball hit by a AAA farm team player probably doesn't have quite the same economic value as Barry's ball:)

[Wayne Brasch]

Saw an article in Money magazine the other day that said Matt (?) Murphy, the man that caught Barry Bonds' historic 756th homerun baseball, was selling it so that he could pay the taxes due on it.

The article went on to say that it would probably fetch upwards of $500K ( this was before someone actually paid over $750K for it).

Had he not chosen to sell it, how would he have declared it and and for what amount?

Dave T

PS - Went to a game last year with my sons and they got a ball hit by a player. Didn't know I had to declare that, although a foul ball hit by a AAA farm team player probably doesn't have quite the same economic value as Barry's ball:)

Dave T,

He'll have to pay taxes twice on that ball, I guess. Once for fighting to get it at whatever value and for the $750K he got from the sale. I'm not really clear as to what value he is supposed to put on it in either case. What is his basis? Zero?

Why does he owe taxes on just getting that ball? Is it sort of like a treasure trove discovered by someone?

Wayne

[GeneInAlabama]

Since I'm not a baseball fan in any way, shape, or form; it would be worth about 25 cents to me. He can use what it is worth to me in establishing the tax for the first time. Since it is only worth a quarter to me, I would consider the sale of it as a $749,999.75 gift and a sale of 25 cents. At least if he was my client, that is the way I would figure it. Of course, if the person that bought it was my client, it would be a different story.

[JohnH]

I'm with Gene on this one. While it's in my possession, it would be worth about $4.00 to me personally. That's what I would have to pay to buy a baseball to play catch with my grandsons, which is about the only use I'd have for a baseball.

But if I were negotiating with a sucker/buyer, I'd have to contend that it's a valuable collector's item of tremendous sentimental value to me, and it will take hundreds of thousand of dollars to pry it from the hands of this suddenly baseball-crazy fan.

[jainen]

>>While it's in my possession, it would be worth about $4.00 to me personally<<

Unfortunately, that's not the question. The value of found property is the FMV (what it's worth on the open market) at the time he gained ownership.

That particular moment, in my opinion, was somewhat before the home run had actually been scored and ruled by the umpire, and quite a bit before the artifact in question had been certified as authentic, so at that particular moment it had no monetary value except as a small souvenir. $4.00 is a reasonable estimate, and that is taxable as ordinary Line 21 income. When he sold it, he recognized $749,996 capital gain.

Personally, I think he got bad tax advice.