Sold a car capital gain..buyer hasn't picked it up

Tax, SDIRAs & Cost Segregation
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Sold a car capital gain..buyer hasn't picked it up

Samantha Klein
Investor · Monroe, WI · Member since 2015 · 691 posts · 610 votes

Hello, I am looking for a CPA that could tell me when I should report the capital gain I am making... I sold a 1969 Charger on July 18, the buyer notified me he can't get the car until Oct and the title has not been signed over, I will be making a capital gain of 20k on the car, do I put down July 18 as the sale date or when he actually picks it up?  The buyer already paid me.

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  • Matt Vogt
    Investor · LaGrange GA · Member since 2014 · 121 posts · 55 votes
    10y

    I am not a CPA, but it would depend on when the car is actually "Sold". What were the terms of the agreement? It would depend on if the payment is considered a deposit or if the buyer officially "bought" the car FOB at that point in time. Did you sign a bill of sale on July 18th?

    Why is this an issue for you anyhow? I would think that taxes would be due by April 2017 for 2016 activity... and both July and October are in 2016. 

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  • Samantha Klein
    OP
    Investor · Monroe, WI · Member since 2015 · 691 posts · 610 votes
    10y

    It is a long term capital gain and because of my tax bracket, I won't owe taxes anyway but I want to make sure it's reported correctly. The buyer has paid for the car in full however we have not signed any bill of sale nor have I signed the title over to him. 

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    10y

    that's interesting I would think if your in the business of buy and selling cars its ordinary income.

    never really thought about capital gain.. because I never sold a car for more than I paid :(  but I don't deal in collector cars.. and I certainly don't write off the difference or loss when I buy a car for whatever amount and sell it 3 years later for less

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  • Samantha Klein
    OP
    Investor · Monroe, WI · Member since 2015 · 691 posts · 610 votes
    10y

    I am not the car business, this is a one time deal. 

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  • Samantha Klein
    OP
    Investor · Monroe, WI · Member since 2015 · 691 posts · 610 votes
    10y

    It is an out of state sale, buyer has not arranged transportation. The buyer was originally going to come get it and get the title then, I will be mailing it to him.

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