Spitzer Questions

[Koss]

Since one of the guys who manages the company that provided services to Spitzer is an Enrolled Agent, maybe he can tell us...

(i) How do you expense breast implants? Are they fixtures that have to be depreciated? Or do they qualify for Section 179?

(ii) What is the recovery period? And if they leak and are replaced, is that a disposition? Or do you just continue the original depreciation?

(iii) What is the depreciable life span of sex toys?

(iv) Where do you report income from blackmail? Line 21 or Schedule C?

(v) Can Spitzer write down the value of his political career before talk radio officially declares it to be a worthless security?

(vi) Can the value of goodwill be represented by a number in parentheses?

Burton

[taxxcpa]

Hillary Clinton's reaction

Hillary Clinton has removed his endorsement from her web site. She was shocked to hear that a public official would cheat on his wife and cannot understand why Mrs. Spitzer puts up with it.

[thomtax]

Since one of the guys who manages the company that provided services to Spitzer is an Enrolled Agent, maybe he can tell us...



(ii) And if they leak and are replaced, is that a disposition? Or do you just continue the original depreciation?

Burton

Burton, would this not possibly be a casualty loss?

LT

[bertrans]

Since one of the guys who manages the company that provided services to Spitzer is an Enrolled Agent, maybe he can tell us...

(i) How do you expense breast implants? Are they fixtures that have to be depreciated? Or do they qualify for Section 179?

(ii) What is the recovery period? And if they leak and are replaced, is that a disposition? Or do you just continue the original depreciation?

(iii) What is the depreciable life span of sex toys?

(iv) Where do you report income from blackmail? Line 21 or Schedule C?

(v) Can Spitzer write down the value of his political career before talk radio officially declares it to be a worthless security?

(vi) Can the value of goodwill be represented by a number in parentheses?

Burton

PROPOSED ANSWERS (SUBJECT TO CONFIRMATION BY PEER REVIEW BOARD):

(i) breast implants are, clearly, improvements; hence, addition to basis.

(ii) (See previous poster).

(iii) The depreciable price of sex toys depends on the genus and species of the toy: e.g., a DOG sex toy would have a depreciable life of 7 dog years; horses,now,probably longer.

(iv) For blackmail, I would opt for Sch C - the inference, there, being that there would be expenses. Note: The IRC does not provide for the deduction of any blackmail payments.

(v) This would be preemptive 'writing down' - I see nothing in the Code forbidding this; i.e., the statute is silent on this matter.

(vi) Only if the applicable schedule is prepared in no-Euclidean space.

Thanks for the tingling questions! (Really - well done, Burton).

[taxmandan]

Burton, would this not possibly be a casualty loss?

LT

I don't think this qualifies, has to be sudden, unexpected or unusual. This was a long-time, repeated occurrance, and not all that unexpected or unusual for political celebrities.