Income Tax on Sale of Delorean

[Mark D]

Oh my god, it's better than I thought! An Audi. I'm getting a car!

[lazabby]

I did a little digging and it was as I suspected. If you sell your car for a loss then tough luck. You can't deduct your loss (federal income tax purposes, not state). There may be exceptions if the car was a business asset. The car is looked at as a capital asset and any gain on the sale is a capital gain. You can decrease your gain by any improvement made to the car so it's important to keep those receipts. Check with your tax preparer for taxability as tax rule continually change. Don't try to cheat the US govt. Tax avoidance is legal but tax evasion is not.

[Michael]

Maybe this and sales tax is why people who own multiple exotics trade a lot. I know one local guy here who always has no less than. 6 or 7 six figure exotics but he never keeps any one car very long. He is always trading. ( perhaps with some personal checks written to cover the difference).

[Helirich]

I was responding to Dave's statement of "per year" but I meant per transaction, not per year or day, but what I'm talking about is having that much money in your car or person or even home at ANY time. You are subjecting yourself to it being confiscated, stolen, lost in a fire and whatever bad things can happen when all you need to do is simply demand a cashier's check which eliminates a lot of those concerns. I have a pretty good safe because I own gold and silver but not everyone has a 4,000 dollar safe. I've been down this debate road before here. Do what you want, make 15 trips to the bank...IDGAS.

Also, if you deposit say 9,999 cash dollars in the bank in one transaction, let alone 4...you are not "fooling" anyone. You are actually painting a bigger target on your head and raising more eyebrows than if you just deposited everything at once.

Back to the OP's original question...no I do not think you are subject to paying any "capital gains" on selling one car. The timeframe that you owned the car may come into play but like I said earlier, state laws may differ. If it were me asking, I would simply check with a local CPA and not a DeLorean group. They will probably answer your question(correctly) for free in email correspondence or FB group.

Not trying to bust your balls on this, just giving people facts that I have researched quite a bit. When you say “your not fooling anyone” , you are correct. You are avoiding filling out paper work. The bank still notifys the feds. When you deposit less than $3000, you are not notifying anybody except the teller. The bit about the “structuring” law is only if they are already looking at you and find rythematic deposits. This is a very serious and sneaky law. If you don’t understand it, you should DUck Duck Go it.

As far as “keeping cash”, I find having large cash is handi when something comes up suddenly. Case in point, I got my Delorean at a very, very reasonable price because I was the first one there with cash.

[Bitsyncmaster]

I had to pay cash for my D. That was back when people were making counterfeit bank notes. I had already got the certified check but the bank understood and gave me the cash. Pretty big wad of $100 bills which would be more these days. I see most of the car shows plop that cash $100,000 on the table to entice the seller to accept.

[MrChocky]

Circumflex.

[Helirich]

I had to pay cash for my D. That was back when people were making counterfeit bank notes. I had already got the certified check but the bank understood and gave me the cash. Pretty big wad of $100 bills which would be more these days. I see most of the car shows plop that cash $100,000 on the table to entice the seller to accept.

They still are! One time I ask my bank “what is as good as cash” referring to certified, cashers, money order, bank draft, whatever. Their reply “cash”. If those instruments are drawn on their bank, no problem, but if I walk in with them from some other bank, I’m not walking out with cash unless I have the funds to cover it in my account.

[Michael]

Not to state the obvious, but you don't release the car or title until funds are 100% verified and secured beyond any doubt, (not reasonable doubt...ANY doubt). The thing with this forum is no matter what detail you leave out(thinking common sense will prevail), someone here will latch onto it and run with it.

[Helirich]

Not to state the obvious, but you don't release the car or title until funds are 100% verified and secured beyond any doubt, (not reasonable doubt...ANY doubt). The thing with this forum is no matter what detail you leave out(thinking common sense will prevail), someone here will latch onto it and run with it.

Very true! On this subject, my brother sold something and was suspect of the payment. (I think it was a certified check or money order) Anyways, he took it to his bank and told them to notify him when it was clear. The bank told him it would take two days to clear. If he didn’t hear anything from them in two days, it was fine. He released the item. Later, the bank said the check was no good. You would think too bad for the bank, but no, my brother was still responsible for it.

Moral of the story, get cash. If your suspect of the cash, deposit immediately regardless of tax implications. (The bank can’t come back later and say it was counterfeit.)

[Mark D]

Typically I keep all of my extra cash tucked away inside my mattress, but I've accumulated so much lately that I've run out of space. So I've just been sleeping on the big pile of money.