A legitimate shot for the average collector to get a T206 Honus Wagner.

fsjeter

I was reading the 4/29/05 issue of SCD and in the follow-up interview with Jeff Rosenberg, president of Tristar Productions, they reported that Tristars' new product will indeed have the Grandaddy of all Baseball cards. The Hidden Treasures: World's Greatest Card Chase, due out this spring, will be $0.99/pack with 5 cards/pack. Inserted in the packs will be "vintage Goudey cards, autographed memorabilia, and rookie cards galore." And of course, the Grand Treasure will be a T206 Honus Wagner card. I didn't buy any of the previous Hidden Treasure's products but I may have to take a shot when this one is released.

Scott

Allen

Packs odds:
1990 Donruss 3:1
1989 Topps 2:1
T-206 Wagner 1:1,000,000,000,000,000,000,000,000,000,000,000(and the 0's just keep going)

fsjeter

Actually, it is 1:50,000,000. They said, "there are about 50 million cards in the World's Greatest Card Chase, and more than 10 million are of stars, superstars, rookies or an insert."

Scott

Knuckles

Cool, do you know the release date?

fsjeter

Here is some additional info on the product. According to another site, it should be available 4/30/05.

Scott

Allen

so 1:10,000,000 packs not bad. I wonder what the condition is? Wonder if it will be a redemption or what, I would hate for a kid to pull it and not know what it was lol. Pretty good deal for them, buy a Wagner for probably $200K or so and it gives them a chance to move 40 million commons and 10 million mass produced stars for $1.00 per 5 cards. Works out to $10 mil. gross I am sure a large percentage is net.

mikeschmidt

Well - remember, it was a poor schmuck who won the T-206 Wagner PSA 8 through the Wal-Mart promotion.

Once it comes public that you own/win the card, odds are that you have to pay taxes for that. And, the only way that you can afford the taxes on a T-206 Wagner card? By selling the Wagner, of course

Allen

The average collector has a legitamate shot at a Wagner most everyday...
Wagner for $81.00
Wagner $53.00
Wagner $21.00

stown

But, but, but, they all look different?? How can this be?!?!







Must be the scammers... er.. I mean scanners.

Mefer

That bottom Wagner is the ultra rare boxing version. Notice Wagner's swollen and shut right eye. Rumor has it Honus got into a boxing match with a kangaroo after he complained of his cards being inserted in tobacco. The deal was if he won they would pull the card. If he lost, a new painting would be done of him right after the boxing match and inserted on a new card. Well, he lost. Only a few of these ultra rare boxing versions made it. That version has to be worth about $3,467,89.56.

bobsbbcards

mikeschmidt beat me to the punch. A "real life" collector will never be able to pay the taxes they would owe from winning a Wagner card. If the Wagner were worth $200K like the one in Mastro, the "lucky" collector would owe roughly $80,000 just in federal tax. Add in state tax and you're around $85,000. Best bet is to sell the card immediately and net $115,000 after taxes.

Shame really. It'd be cool if somebody could actually keep the card without going into debt.

TheCARDKid

I never understood the tax situation.

Why doesn't it apply to all cards you buy in a pack? If I buy a pack and get a high dollar card (i.e. Jordan rookie), no taxes would need to be paid (unless I sold it).

What if you pull a $10,000 insert? Or the guy that bought a '52 Topps Low Number pack and pulled the PSA 10 Pakfo (worth $80,000).

Legally, how would that differ than buying a pack and getting a Wagner?

Mac53

Mefer--too funny.

And speaking of funny, technically, you are liable to pay income taxes on anything you make money on, although the losses you have in buying a bunch of junk could offset it. It's just with all the pub from pulling a Wagner, some IRS agent is going to get all worked up to suck your blood.

fsjeter

<<Why doesn't it apply to all cards you buy in a pack?>>

In a way, it does. In your Jordan scenario, legally, you would be required to list the difference between the pack price and the FMV (Fair Market Value) as "Other Income" on your annual return (not when it is sold as you stated). According to the IRS, the key is the established FMV. In your "'52 Topps Low Number pack" scenario, legally, you should claim the difference between the pack price and the raw value because you didn't pull the card out of the pack graded a PSA 10. The guy that pulled the LeBron James 1/1 Exquisite from the pack is not required because when he received the card, there was no FMV established so they consider it to be the price of the pack. In the case of the Wagner, Jordan, Pafko, there is an established FMV so if you obtain it for less than the FMV, the difference is viewed as income. Are you thoroughly confused now! That's the way the guy from the IRS explained it to me so don't shoot the messanger.

Scott

lostdart58

<< <i>mikeschmidt beat me to the punch. A "real life" collector will never be able to pay the taxes they would owe from winning a Wagner card. If the Wagner were worth $200K like the one in Mastro, the "lucky" collector would owe roughly $80,000 just in federal tax. Add in state tax and you're around $85,000. Best bet is to sell the card immediately and net $115,000 after taxes.

Shame really. It'd be cool if somebody could actually keep the card without going into debt. >>






Federal taxes on $200,000 for a single person, no deductions is roughly $51,000.

TheCARDKid

<< <i><<Why doesn't it apply to all cards you buy in a pack?>>

In a way, it does. In your Jordan scenario, legally, you would be required to list the difference between the pack price and the FMV (Fair Market Value) as "Other Income" on your annual return (not when it is sold as you stated). According to the IRS, the key is the established FMV. In your "'52 Topps Low Number pack" scenario, legally, you should claim the difference between the pack price and the raw value because you didn't pull the card out of the pack graded a PSA 10. The guy that pulled the LeBron James 1/1 Exquisite from the pack is not required because when he received the card, there was no FMV established so they consider it to be the price of the pack. In the case of the Wagner, Jordan, Pafko, there is an established FMV so if you obtain it for less than the FMV, the difference is viewed as income. Are you thoroughly confused now! That's the way the guy from the IRS explained it to me so don't shoot the messanger.

Scott >>



I guess if everyone did this, the modern insert/chase card craze would be affected....just a little bit

What if you never opened the pack? Say you bought '86 Fleer packs for 50 cents in 1986 and now they are worth $300 a piece (or say a star is showing through the wrapper). The FMV is much higher than the purchase price.

In the case of the Lebron 1/1, you could simply extrapolate past 1/1 sales and numerous other factors to arrive at an estimate.

Ok, who's ready to start opening up packs in a deep underground cave where we can have some privacy? LOL

dallasactuary

<< <i> Federal taxes on $200,000 for a single person, no deductions is roughly $51,000. >>



That's assuming the winner has $0 in other income. If you win $200,000 on top of your other income, then the additional tax would probably be somewhere between $60,000 and $70,000. The $80,000 figure was the high end under Comrade Clinton's tax code.

mikeschmidt

TheCardKid:

To some extent, it does.

The Pafko PSA 10 was sold through an auction house. Paper trail of consignment payments. I'm not sure that the IRS pays close attention to all the auction houses - but for big ticket purchases, you can be sure they do. Do you remember the scandal of sales tax avoidance on art masterpieces sold through Sotheby's a few years ago?

This hobby is largely unregulated - and you can often fly under the radar. But it's not always so easy. If you just pulled a Wagner out of a pack and could sell it for cash - you could be fine. But you will get a redemption card - and thus the paper trail starts. Heck, even look at what they've been doing on Ebay with Paypal. Did you get that message a few months ago about Paypal reporting to the IRS any accounts that have over $2,000 per month of activity. Want to take a guess why they've done that...?

To some extent - modern card packs are increasingly like the lottery. Heck, isn't there one issue that even gives out cash in packs? Lottery winnings are definitely taxable - and baseball cards are as well. Obviously, you can shield yourself to some extent - but I would highly suggest being careful....

~ms

TheCARDKid

In the 90's, I remember reading about the grey area of state gambling laws being applied to packs of baseball cards. This is when cards became major collectibles and the "lottery" mentality took over the modern pack market. That's why I was suprised at the Jordan and Pafko examples.

Still, it's sad that someone can't keep the Wagner.

Stone193

<< <i>This hobby is largely unregulated - and you can often fly under the radar >>


Marc
That is so true and won't last forever. I remember reading years ago how the IRS swooped down on the "carnival" business since it was terribly under-reporting in the millions. The net result was that some of the biggest companies like Royal American went out of business.

Ebay is next. When you sell something with an auction house, I could see them being required to supply the consignors with a 1099 or something like that.

Another thing, if they wanted - they could go after guys like Mr. Mint who hands out tons of cash and require him to report the sales by receipts/issuing 1099's or something like that. Then it would be up to the seller to supply invoices and declare the difference as income?

Just some really crappy thoughts. Please don't kill the "messenger!"

mike

edit: if I won any Wagner, I couldn't afford to pay the taxes!

Knuckles

I wonder if a Canadian can get away with not getting taxed if they pulled the card.

fsjeter

<<What if you never opened the pack? Say you bought '86 Fleer packs for 50 cents in 1986 and now they are worth $300 a piece (or say a star is showing through the wrapper). The FMV is much higher than the purchase price.

In the case of the Lebron 1/1, you could simply extrapolate past 1/1 sales and numerous other factors to arrive at an estimate.>>

1.) They go by the FMV when the item was received. If you purchased the pack in 1986 for $0.50 then that is the FMV when it was received. If you turn around and sell it 20 years later for $300, then legally, $299.50 is reportable as income. This is when you have to report after the sale of the item.

2.) That won't work either. Most high priced 1/1's sell for between $800 - $1,500 (most sell for much less). There's no way anyone could have known that the LeBron 1/1 would sell for $300,000 +. They keword in the prevoiusly stated examples being established FMV.

BTW, the IRS guy did say that someone could pull it and not say anything but noted that the publicity might get them in the end.

I'd still love to be able to say that I owned a Wagner at one time.

Scott

mikeschmidt

Steve: One of the saving graces with selling sportscards is that you would only theoretically have to pay taxes on actual profits. And, not to say I would suggest this, but you could easily manufacture inflated prices about what you paid.

That being said - it shouldn't be a problem for most of us who don't pull a Wagner.

I have yet to meet a collector [I have not met Larry Meyer....] who has not overpaid for cards at one time or another, so...!

SlangNRox

If this is the case, Can I open up my box of 1990 Fleer and deduct my losses from what I paid and the fair market value of the cards that I pulled?

ajw

<< <i>If this is the case, Can I open up my box of 1990 Fleer and deduct my losses from what I paid and the fair market value of the cards that I pulled? >>



I believe you can only deduct this loss if your primary motivation for buying and selling cards in general is to make a profit. If you're primarily a collector then you can't deduct the loss, even if your sole intention in buying and busting this box was to make a profit.

I think.

Knuckles

Yeah, what if I sold it to my wife or Dad for a dollar..

ajw

<< <i>Yeah, what if I sold it to my wife or Dad for a dollar.. >>



You're not getting taxed for selling the card, you're getting taxed for acquiring it. It becomes "income" and is then taxed. If not, then it would be easier to keep the card rather than selling it.

jmullen

Correct me if I'm wrong, but this hasn't been the first time a Wagner has been given away for sportscards. Sometime in the early 1990s a company by the name of Treat Entertainment had something worked out with I think Target where when you bought a pack of cards you got a redemption. They then had a drawing. From what I remember, a lady won the card and couldn't pay the taxes so she instantly sold it. Being a basketball collector, I barely remember the story, but I'm sure someone will soon post the real story.

Jeff

jmullen

Sorry, I'm loosing my mind. Everytime you bought a pack you would get the chance to fill out a ticket for a drawing. The winner getting the Wagner.

Now, who knows the real story.

Jeff

goudeygold

I say whoever finds the wagner simply keep quiet about it. let the supply of packs dwindle, then people will be scalping packs for insane prices thinking the odds are increasing for pulling the wagner. After the pandamonium ends, and everyone is clueless and blaming the card company for not really issuing the card... simply tell everyone you had it since the packs first went on sale.

How develish is that?!

GG