Deceased Musician's Instrument

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  • Cheryl48
    Junior Member
    • Jan 2007
    • 24
    #1

    Deceased Musician's Instrument

    We've been discussing this situation in our office....

    Musician died. His instrument was being depreciated.

    The wife inherited the instrument (stepped up basis) and after some time sells it. (Pays a sales commission in the process.) This generates a loss.

    Do we consider this a business sale or sale of a personal asset?

    Any thoughts would be greatly appreciated.
    Tags: None
    • ChEAr$
      Senior Member
      • Dec 2005
      • 3872
      #2
      I think you answered your own question.

      Originally posted by Cheryl48
      We've been discussing this situation in our office....

      Musician died. His instrument was being depreciated.

      The wife inherited the instrument (stepped up basis) and after some time sells it. (Pays a sales commission in the process.) This generates a loss.

      Do we consider this a business sale or sale of a personal asset?

      Any thoughts would be greatly appreciated.
      You said she inherited the instrument at FMV. Go from there.
      ChEAr$,
      Harlan Lunsford, EA n LA

        Comment

        • Gretel
          Senior Member
          • Jun 2005
          • 4008
          #3
          In other words. Sale of personal item = no loss.

          You cannot have it both ways. If this could be considered a business sale in winding down his affairs then you have to recover depreciation.

            Comment

            • Larmil
              Senior Member
              • Dec 2006
              • 621
              #4
              Originally posted by Cheryl48
              We've been discussing this situation in our office....

              Musician died. His instrument was being depreciated.

              The wife inherited the instrument (stepped up basis) and after some time sells it. (Pays a sales commission in the process.) This generates a loss.

              Do we consider this a business sale or sale of a personal asset?

              Any thoughts would be greatly appreciated.
              Just a thought - It may considered investment property. If the wife had no business or personal use for the instrument, I would probably take the loss.

                Comment

                • ChEAr$
                  Senior Member
                  • Dec 2005
                  • 3872
                  #5
                  Unless

                  Originally posted by Larmil
                  Just a thought - It may considered investment property. If the wife had no business or personal use for the instrument, I would probably take the loss.
                  the instrument was an heirloom, antique, valuable in it's own right, it would not be
                  an investment.
                  ChEAr$,
                  Harlan Lunsford, EA n LA

                    Comment

                    • Cheryl48
                      Junior Member
                      • Jan 2007
                      • 24
                      #6
                      Deceased Musician's Instrument

                      Originally posted by ChEAr$
                      the instrument was an heirloom, antique, valuable in it's own right, it would not be
                      an investment.
                      The instrument was purchased used and by a working musician.... definitely not an antique or heirloom.

                        Comment

                        • Kram BergGold
                          Senior Member
                          • Jun 2006
                          • 2112
                          #7
                          Personal property

                          It is personal property with a stepped up basis. Tax on gain. No loss.

                            Comment

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