I bought 10 boxes of baseball cards for $35 each. The cost basis for each card is $.34 and there are 990 cards total. If I sell 1 card for $350, do I have tax of $0?

[rynstrss]

What about if I sell one card for $350 and sell the others for $1 total, or just throw them away?

Can I offset my $350 sale, or any other sales, by getting rid of other cards that had a cost basis higher than I got rid of them for?

[DoninGA]

Your cost basis is $0.34 per card.  If you sell one card for $350 then you have a capital gain of $349.66.

If you sell any other cards for $1.00 each then you have a capital gain of $.66 per card.

If you throw all the other cards away other than the card you sold for $350 you still have a capital gain of $349.66.

[Mike9241]

the sale could come under the rules for sale of collectibles, but if it's an activity not engaged in for a profit, it's likely a hobby and the hobby rules say income is taxable, but expenses are not deductible.

[rynstrss]

Thanks for the reply. What if I sell the other 989 cards for $10 total? In total I would have $360 in sales for a $10 profit by selling them all. 

[rynstrss]

I purchase cards, and will sell some more rare ones at a profit, but it's hard to sell the common ones. So if I can sell 1000 of them at $10 total, will that offset some of the profit on the 1 expensive card?

[DoninGA]

Your cost is $350.  Any sales you make that is over $350 is your profit and is taxable.

[fanfare]

Without a 1099-B,
IRS requires details of your SELL transactions to be supplied on some Form 8949,
or on your other forms (e.g. consolidated 1099-B or spreadsheet) which have the same information and in the same manner as Form 8949.

Details include description and  "Date Sold".

If you're playing games with your basis, that's not nice.

@rynstrss 

[rynstrss]

@fanfare 

Hi - thanks for the comment. I am not looking to play games with my cost basis. I have receipts and sales for cards I purchased and sold, whether they were single buys or new boxes. 

I'm just trying to figure out that if I sell some cards at $X amount profit, do I have the ability to offset the profits with selling card "lots" for less than my cost basis. 

A lot of my cards have a cost basis of $.34 - $1.29 each. Some can be sold for $.75 - $1 each, and some are usually $.10 on other sites like sportlots. 

If I sell X amount of cheap cards at the end of the year at a loss to clear my inventory, will that lower my profit?

Thanks