sales of antiques at auction

[crkdad]

Hello.

I sold many (50+) antique pottery items at auction in 2022.   The pottery items were all different but were the same type - Victorian era, English figures.  

The items were sold in lots of 4 or 5 items.  

Can I report the auction sales by lots, or do I need to somehow allocate the lot sales price amount among the items and report each item sale individually?  If I need to report each item sale individually, how do I divide the total lot sale price (and the auction house charges) among the items?   

Any help would be appreciated!  Thank you!

[JosephS1]

Yes, you may report the auction sales by lots as that is how they were sold.  You must be able to determine the original cost value of the items sold in each lot for gain or loss reporting purposes.

What you are doing by selling the sales by lots is similar to selling stocks of similar attributes that are combined for single line reporting such as Short-Term, Long-Term, and the like.

Keep in mind there are special rules for selling personal items.  The link below should assist you in that regard and while it may not be exactly as you sold your items the rules are the same.

Personal Sales

@crkdad 

[crkdad]

Thank you very much for your reply!

I have one follow up question.  You refer me to sales of personal items.  Do you consider antique pottery figures to be personal items so that no loss may be taken?  I thought antique pottery figures would be considered a collectible, rather than a personal item, and therefore a capital loss could be taken.

Thanks again!

[JosephS1]

It is possible what you say can be attributed to collectibles and therefore allowed a capital transaction.  You will need documented proof that they are collectible items instead of common antique items.  An appraisal certificate by a licensed appraisal firm or some similar letter(s) or document(s) would suffice.  

I have enclosed a link to the IRS page the shows the treatment of the sale of collectibles.  The IRS has the authority to deem a sale of personal property as a sale of collectibles at their discretion.  Collectible sale gains are taxed at the maximum tax rate of 28% currently so you should consider the net tax ramifications of your sales if you have the opportunity.  While personal sale losses are not deductible and collectible sale losses are, subject to the yearly maximum of $3,000 (excess loss over $3,000 is carried over to future years), the profit from personal sales is at your marginal tax rate while the collectible sales gain is at 28%.

Capital Gains and Losses

How are collectibles taxed?

@crkdad 

[crkdad]

Thank you JosephS1!