Fermion
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Ok, it is getting near time to do taxes and I have to figure out how to report the $5,000 profit from a domain name I owned for ~13 years and sold in 2014 (I posted a thread about that at the time, kept getting higher offers).
I figured at the time it would be considered ordinary income and because we are in the top bracket, would pay about $1600 in tax. I bought the domain for use personally but did use it for a sole proprietor business from 2005 to 2010. I never deducted anything for fees and did continue to use it also for personal use (emails, sharing photos, etc.). Kind of muddy there.
I don't even know how it will be reported. The buyer was in the UK and the transaction was done on escrow.com but I did not get any kind of 1099.
It would be nice if I could treat it as a capital gain as I have $20,000 in carryover capital losses that could go against it. Amazingly, there is very little information on how to treat domain name sales. I don't really know what we pay the IRS for...they really don't DO anything to help figure out how to pay your taxes.
Other than this part, our taxes are quite simple and I like to do them myself. We take standard deduction and don't itemize since I have paid off our house. I am not interested in consulting a tax adviser since I have little faith they really know more than I do right now.
So....any non binding suggestions? Seems like the safest thing would be to treat it as ordinary income and pay the most tax...unless that somehow could come back to bite me?
I figured at the time it would be considered ordinary income and because we are in the top bracket, would pay about $1600 in tax. I bought the domain for use personally but did use it for a sole proprietor business from 2005 to 2010. I never deducted anything for fees and did continue to use it also for personal use (emails, sharing photos, etc.). Kind of muddy there.
I don't even know how it will be reported. The buyer was in the UK and the transaction was done on escrow.com but I did not get any kind of 1099.
It would be nice if I could treat it as a capital gain as I have $20,000 in carryover capital losses that could go against it. Amazingly, there is very little information on how to treat domain name sales. I don't really know what we pay the IRS for...they really don't DO anything to help figure out how to pay your taxes.
Other than this part, our taxes are quite simple and I like to do them myself. We take standard deduction and don't itemize since I have paid off our house. I am not interested in consulting a tax adviser since I have little faith they really know more than I do right now.
So....any non binding suggestions? Seems like the safest thing would be to treat it as ordinary income and pay the most tax...unless that somehow could come back to bite me?