I'm looking for advice on finding a CPA

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mdburn_em

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Joined
Mar 16, 2006
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684
Location
Chesapeake, VA, USA
Hello everyone. Happy New Year.

Like the title says, I would like to find a good CPA to answer questions I have about how I should handle any revenue I generate selling items that I make.
Additionally, I have a lot of items that have been inherited and I need to determine how to establish a "basis" for them. (I think that's the term). I have avoided selling anything that I make because I don't know what to do about taxes.

I want to pay every bit of the taxes I owe on money I make but I don't want to pay taxes when I don't have to. I have done that once already. I sold a collection of silver coins that were passed down to me from my dad. Because I didn't know any better, I listed the total sale as income and paid taxes on it all. I didn't know any better but in the future, I would like to avoid being an idiot.

Other questions would be what is the best type of entity to sell as. I'm sure I will come up with more questions. For instance, I still have pen kits that I purchased in the late 2000's. I have no receipts for them and they aren't made anymore. What do I do about that?

I'm in Virginia and I'm assuming I would need to find one in Virginia. How did you find one? If you are a CPA, any professional advice on locating a professional that handles these type of questions?
 
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jttheclockman said:
Who does your taxes?
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I do. The only reason I don't do the simplest tax forms are because I pay alimony so I've had to use the long form.

My main source of income is a regular 9 - 5. Pen Turning and other things I make are simply hobbies that I haven't attempted to make sales on which is why the request for advise on finding a CPA.
 
I am not a CPA, but typically for items inherited from an estate, the cost basis resets to the value on the date of death. For securities (stocks, bonds, etc...) this is easy. For things like collections, it is a bit less simple but is "fair market value" the time of death.
 
d_bondi said:
I am not a CPA, but typically for items inherited from an estate, the cost basis resets to the value on the date of death. For securities (stocks, bonds, etc...) this is easy. For things like collections, it is a bit less simple but is "fair market value" the time of death.
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Yeah, that's exactly where I need advice from a professional. My dad died in 2002 and I sold the coins in 2013. I simply do not know what their value was in 2002. There likely wasn't a great deal of difference but how do I determine that?
 
mdburn_em said:
Yeah, that's exactly where I need advice from a professional. My dad died in 2002 and I sold the coins in 2013. I simply do not know what their value was in 2002. There likely wasn't a great deal of difference but how do I determine that?
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A CPA will be able to advise you but not help you determine the value at any point. For that you will need to go to a rare coin dealer/specialist. Fair warning, you may need to go to more than one and since they have already been sold, it will be difficult as condition is critical to value. Also, unless you live an a major metro area, it has gotten more and more difficult to find these people.

Good Luck!
 
d_bondi said:
A CPA will be able to advise you but not help you determine the value at any point. For that you will need to go to a rare coin dealer/specialist. Fair warning, you may need to go to more than one and since they have already been sold, it will be difficult as condition is critical to value. Also, unless you live an a major metro area, it has gotten more and more difficult to find these people.

Good Luck!
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Thanks for that info. I do understand that they can't help me determine value but I think they can advise me on how to proceed other than that. As I think about it, I think it comes down to advice regarding the documentation I will need in the event that the IRS decides to audit me (I'm not worried about the collection that I sold. That's over and done with. I made a mistake and I will live with that.)
Here are some examples of things that I will need to deal with.
1. My wife's father passed in 2008. He had a coin collection that was split among the 3 kids. Most of these coins are only valuable for the silver value. If I understand you correctly, your advice would be to get the figure the dealer will pay us for them today and then ask if he can give an estimated value of what they would have been worth in 2008? This would establish the cost basis.
2. There was a considerable amount of milkware in the house at the time the father passed. How do I establish a cost basis that will be acceptable to the IRS for that so I can document the loss or gain after selling it?
3. I bought a porcelain doll for my daughter in 2006. I still have it and it hasn't been out of the box. I paid right at $100 for it. I do not have the receipt. If I sell it for $80, that would be a loss and is not reportable. However, if I sell it for $150, that would be a gain of $50 more than I paid for it and that $50 is reportable. Is the IRS going to take my word for it, (either scenario) in the event I get audited?

I have rooms filled with stuff that I will be selling over time. They're all smaller items for the most part but with PayPal and the other selling platforms providing documentation to me and the IRS at the end of the year, I will need to have my ducks in a row.

Of course, my biggest need for a CPA is to advise me on the type of entity I need (LLC, proprietorship, etc) for my particular situation. This other is important but secondary.
 
I always use a CPA, no matter the cost. I got screwed by one of the walk-in tax services. They never took deductions for a business. Should have filed amendments.
CPA: Cheapest Person Around, Certified Parking Attendant,Can't Pass Again. This from a CPA.
 
Hi Mark,
I'll send you a message with my number.
Regarding the type of entity - unless you set up a corporation, the type of entity (LLC or sole prop) will have relatively little effect on your taxes. Some states have additional filing requirements for an LLC versus a sole prop. The main difference is legal protection (assuming you get a LLC and properly run/maintain the LLC, then you would likely have better legal protection than just operating as a sole proprietor).
 
I am CPA...I don't want anything. Pm me your number. I can lead you un the right direction.
 
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