A commentary.
The buck stops here and the black birds on the wire poles are chattering
about? In light of the Federal and States budget
crisis (Health Care reform) both the Internal Revenue Service and the
individual States Tax Franchise boards need to scrutinize
these record dealers who claim purchases for re-sale (claim a tax exempt
status) then keep them stashed on their plywood
records shelves.
A well known Pacific Northwest collectors' purchase of a $10,200.00
record, (Reported in Krause Publications, Issue September
2009 "Goldmine" Magazine) (see:
http://www.urbanartantiques.com/2009/john-tefteller-wins-record-on-ebay-issues-press-release)
poses ethical the question isn't the purchase subject to a luxury tax?
But importantly there is the possibility abuse of record
dealers claiming their big dollar purchases for re-sale then claiming a
loss or tax exempt re-sale status on the purchase is that fair to the
ethical dealers who play by the rules? Record dealers who enter into
quid pro quo deals should have their tax exempt records audited (IRS and
state). Now this doesn't imply that the gentleman was in violation
but it does raise flags. Taxes are taxes but when a person lauds their
purchase it should go under Big Brother's microscope.
So -
A. Isn't a substantial purchase of recording over $10,000 liable to
Federal or State income tax under the purchasers under current
taxation laws? What about purchases that go overseas they should be
liable to the tax laws? How about $5,000+ records coming
into the USA, what is the taxation status?
B. The buck stops here. Please take a good look at Stephen M.H.
Braitman's article in the October 2009 issue of "Goldmine"
(Krause Publications) and look carefully at Braitman's wording.
Pretentious writing but explicit into the de facto of record
dealers. One thing that bothers me about this article is Braitman
explicitly states a dealer duping an ignorant man/woman out of
rare record quickly turned a profit for it on eBay. Any ethical seller
of rare recordings would tell the owner the luck of
having a record worth a fortune, right! Wrong. In the record collecting
business there are two groups - the ethical and the unethical. Whereas
the ethical is likely to inform the owner that they have a potential
record worth $5,000 or even $35,000.00 and represent him or her to an
ethical auction house like Collect.com, Butterfields, Bonhams,
Christies, etc. It's tiring to hear certain dealers dupe/lure/cheat, the
ignorant owner into peanuts then turn a hefty profit. In other
words there needs to be a stop to these dealers fucking people out their
potential retirement nest eggs.(Braitman's article doesn't mention an
ethical transaction at all, mysteriously and take n o t e).
C. Then there is the issue of a record dealer abusing their re-sale
business license by claiming their purchase as re-sale
(tax exempt) avoiding state mandated taxes. So both IRS and State tax
franchise boards should scrutinize business re-sale licenses
and see if they are paying their fair share. Or record dealers taking
advantage of the system. This could best achieved by IRS
agents watching eBay sales and thumbing through trade magazine like
Goldmine and the price guide advertisements.
D. Contact your legislature representatives, inform them to scrutinize
eBay. Is eBay/Paypal abiding by the IRS rules of reporting
purchases of over $10,000. Inform your legislature that the standard
should be lowered to $500.00 and should be taxable. When
the purchaser claims a re-sale then flags should go up.
E. Finally those that are in violation that is misreported items should
be seized by the IRS or State Tax boards.
