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Abstract: 

Owners of collectibles face unique income tax issues. Two such issues are (1) defining the term “collectible” for tax purposes, and (2) determining whether collectibles will be treated as dealer property, investment property, or personal use property. This article examines the legal and regulatory context of each issue and suggests planning steps for advisors to achieve optimal income tax consequences for clients who own collectibles.

Keywords: collectibles, tax planning, dealer vs. investor, artwork, classic cars, Prop. Reg. Sec. 1.408-10

Affiliations:  1: Sole Practitioner.