Observations on the current state of the hobby from a show this weekend

[pewe]

Originally Posted by hermanotarjeta

Don't forget that some people in this country pay up to 53% income tax.

Let’s say you were selling a $1000 card that your cost basis was $500.

If you got paid market value of $1000, and remitted 53% taxes on the $500 in capital gains, you’d net $735.

Looks like paying taxes would still be a better deal, even in that high tax scenario.


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[ironfireman]

Originally Posted by hermanotarjeta

Don't forget that some people in this country pay up to 53% income tax.

Canada? Who pays 53%?

[pewe]

Originally Posted by ironfireman

Canada? Who pays 53%?

A self employed person living in a city like SF or Manhattan could get there at the highest marginal rate. Wouldn’t be very common, of course.


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[ironfireman]

I'm not an accountant, but if you make enough money to be in anything but the lowest of a tax bracketts you need to hire a good accountant. If you are self employed, form a biz and run everything through it.

[pewe]

Originally Posted by ironfireman

I'm not an accountant, but if you make enough money to be in anything but the lowest of a tax bracketts you need to hire a good accountant. If you are self employed, form a biz and run everything through it.

The funnier part: long term capital gains I believe are 28% on collectables. So it wouldn't even be possible to reach near the edge case 53% top marginal rate in many cases.

[hermanotarjeta]

Originally Posted by pewe

Let’s say you were selling a $1000 card that your cost basis was $500.

If you got paid market value of $1000, and remitted 53% taxes on the $500 in capital gains, you’d net $735.

Looks like paying taxes would still be a better deal, even in that high tax scenario.


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Now, it can take about one minute of your time to complete a cash transaction at a card show. You can use the money immediately. Why don’t you calculate the cost of listing a card, eBay and PayPal fees, shipping cost, going to the post office, dealing with chargebacks, relisting, computer, scanner and printer costs with electricity use and maintenance, dealing with buyer disputes, gas price, negative transaction evaluation, lost mail, scammers etc etc. AND your 53% income tax on top of that.

Sometimes a cash transaction is 100% worth it.

[pewe]

Originally Posted by hermanotarjeta

Now, it can take about one minute of your time to complete a cash transaction at a card show. You can use the money immediately. Why don’t you calculate the cost of listing a card, eBay and PayPal fees, shipping cost, going to the post office, dealing with chargebacks, relisting, computer, scanner and printer costs with electricity use and maintenance, dealing with buyer disputes, gas price, negative transaction evaluation, lost mail, scammers etc etc. AND your 53% income tax on top of that.

Sometimes a cash transaction is 100% worth it.

So... you are saying the seller wouldn't own a computer, scanner, and printer, or maintain those things if they didn't sell this one card???

And negotiating a sale at a show isn't a free lunch. The seller needs to deal with cost to get there, entry fee, bartering with multiple dealers to find someone willing to buy at the best price, etc.

So most of your worries there are at best a wash between the two.

But lets take the rest into account. On that same $1000 market value card where your cost basis is $500. You still do MUCH better on the non-cash deal. ROI in this case goes from $0 to $200.

Option A: Sell using a consignor, so you don't have to deal with the rest of the hassle, and they charge you 13% on your $1000 card.

Option B: You haggle with the buyers at a show and take 50% discount vs. Option A.

We'll assume all the other costs are a wash (gas, shipping vs. entry fee to the show, time, etc.).

Option A: gross $1000 - $130 fees - $170 taxes (at your worst case ~53% level) = ~$700

Option B: ~$500

[hermanotarjeta]

Originally Posted by pewe

So... you are saying the seller wouldn't own a computer, scanner, and printer, or maintain those things if they didn't sell this one card???

And negotiating a sale at a show isn't a free lunch. The seller needs to deal with cost to get there, entry fee, bartering with multiple dealers to find someone willing to buy at the best price, etc.

So most of your worries there are at best a wash between the two.

But lets take the rest into account. On that same $1000 market value card where your cost basis is $500. You still do MUCH better on the non-cash deal. ROI in this case goes from $0 to $200.

Option A: Sell using a consignor, so you don't have to deal with the rest of the hassle, and they charge you 13% on your $1000 card.

Option B: You haggle with the buyers at a show and take 50% discount vs. Option A.

We'll assume all the other costs are a wash (gas, shipping vs. entry fee to the show, time, etc.).

Option A: gross $1000 - $130 fees - $170 taxes (at your worst case ~53% level) = ~$700

Option B: ~$500

Option B: $700 back if you are getting 70%, instantly.

And say you earn $150/ hour on you day job. You can spend an hour mowing your lawn or pay a guy $20/hour to do the job for you.

If you do it yourself, it’s “free”. If you pay a guy $20, it’s a cost. But you could make $150 doing your day job. You’re still up $130 pretaxes.

Same concept can be applied to card sales. My free time is worth more than selling a card on the internet for 10%-20% more money, theoretically, not taking into consideration all the labor, time and supply expenses.

[notfast]

I always love these posts where someone is such an honorable person that they pay their taxes on 100% of everything they do always.

[pewe]

Originally Posted by hermanotarjeta

Option B: $700 back if you are getting 70%, instantly.

And say you earn $150/ hour on you day job. You can spend an hour mowing your lawn or pay a guy $20/hour to do the job for you.

If you do it yourself, it’s “free”. If you pay a guy $20, it’s a cost. But you could make $150 doing your day job. You’re still up $130 pretaxes.

Same concept can be applied to card sales. My free time is worth more than selling a card on the internet for 10%-20% more money, theoretically, not taking into consideration all the labor, time and supply expenses.

Certainly if you don't take as much of a discount you can get to a breakeven. But I thought the issue was you'd have to take a 50% discount to sell it for cash.

BTW I'm confused on your time argument. Going to a show to barter and sell a card has got to take WAAAAAY more time than simply shipping your card to a consignor to just deal with it for you.

If you don't want to spend time you do what I do: hoard it all and don't sell anything

[pewe]

Originally Posted by notfast

I always love these posts where someone is such an honorable person that they pay their taxes on 100% of everything they do always.

I believe the above argument is that there are a set of people who want to avoid taxes so much that they would be willing to earn LESS than they would if they just paid taxes.

[hermanotarjeta]

Originally Posted by pewe

Certainly if you don't take as much of a discount you can get to a breakeven. But I thought the issue was you'd have to take a 50% discount to sell it for cash.

BTW I'm confused on your time argument. Going to a show to barter and sell a card has got to take WAAAAAY more time than simply shipping your card to a consignor to just deal with it for you.

If you don't want to spend time you do what I do: hoard it all and don't sell anything

Well, if you use your leisure time to go to a show, ie meet up with some friends, hang out with some dealer buddies and shoot the breeze, get a vibe of the local sports cards scene, educate yourself about what is selling and what is not and socialize, there is no cost to it!

If you enjoy packaging cards, making labels, standing in line at the post office and dealing with angry customers, the more power to you.

[SetBuildingGuy]

Originally Posted by mwash1983

Went to the Albany show today to sell and possibly to buy. I ended up spending a dollar today and I ended up flipping the card for 10 or so. Attendance was down 25% compared to the November show and a number of dealers weren’t there as well. As far as sales, I don’t think anyone made money, I overheard people saying they hadn’t made their table back yet. People were starting to drop some of their prices and I almost bought a Trea Turner heritage auto for $100. Still some people were massively too high on things as I wanted to get a Molina bowman rc and they wanted 50 as it’s a 20 dollar card now. Of course you saw some pelican boys trying to dump the shiny cheap stuff. I didn’t have shiny stuff that I sold it was hockey and a Witt heritage refractor /673.

I set up at a show in New Hampshire yesterday. I had the bowman molina rc for 15$. Let me know if you trade cards?

[anusinha]

Originally Posted by pewe

I believe the above argument is that there are a set of people who want to avoid taxes so much that they would be willing to earn LESS than they would if they just paid taxes.

The guy in the 53% tax bracket has better things to do than spend a weekend trying to haggle an extra 10% on his Mookie Betts slab.

[SetBuildingGuy]

Originally Posted by Bcr

Went to my first show in awhile over the weekend. Pretty packed and was fun to look at some cool cards. I was somewhat surprised that most of the tables were cash only which was a turn off considering the prices were still a bit higher than they should be.

I did hear a couple of older guys talking about comps and couldn't figure out what it meant. Made me laugh.

Wow i never considered accepting or paying with anything but cash at a card show. Guess im old now.

[pewe]

Originally Posted by hermanotarjeta

Well, if you use your leisure time to go to a show, ie meet up with some friends, hang out with some dealer buddies and shoot the breeze, get a vibe of the local sports cards scene, educate yourself about what is selling and what is not and socialize, there is no cost to it!

If you enjoy packaging cards, making labels, standing in line at the post office and dealing with angry customers, the more power to you.

No doubt re: your first paragraph. If you are just going to hang out, you can always decide to move something. Kind of like you could do with any friends, or your LCS that you build a nice relationship with.

That's why I've moved some some of my collection to folks on BO on occasion. Helping some friends out with their own collection. Or when I needed to free up some $$$.

Fortunately, I don't think I've needed to sell anything through BST at too much of a discount. Normally felt like a fair deal, and low risk, with smooth experiences...

...but I guess I've been fortunate that I didn't need cash ASAP, so could sell closer to market without accelerating the deal. Its like on eBay, where I just listed a USA little league bat over the weekend (I realized I screwed up, and it was too big for my son) - I'm sure it will sell in the coming few months for a reasonable price as it is in great condition... but if I was willing to get paid half the current list price, I'm sure it would have sold within-the-hour.

I don't need to rush getting that $$... it will happen when it happens.

[pewe]

Originally Posted by SetBuildingGuy

Wow i never considered accepting or paying with anything but cash at a card show. Guess im old now.

I guess the challenge with cash, and why most business moved away from it include:
-- buyer: you need to have enough when you discover something unexpected you want to buy
-- seller: you miss out on sales to people who don't use cash or don't have enough for something that they could cover digitally
-- you are a target to have it stolen (and not just by an external thief... if you have employees, the graft and shrinkage can be material)
-- you need to make extra trips to/from a bank to deal with it
-- accounting is a pain and probably much more costly

[Bcr]

Originally Posted by SetBuildingGuy

Wow i never considered accepting or paying with anything but cash at a card show. Guess im old now.

It's just a matter of convenience in this day and age. No reason that digital transaction shouldn't be an option, but I'm guessing cash makes it easier for places to dodge taxes.

[hermanotarjeta]

Originally Posted by Bcr

It's just a matter of convenience in this day and age. No reason that digital transaction shouldn't be an option, but I'm guessing cash makes it easier for places to dodge taxes.

Let’s just say some people would like to avoid any “imperial entanglements”.

[Yanks23]

The big problem with the new tax law of $600 sales is that most people if they werent running stuff as business prior to 2022 or kept good records they have no backup for cost basis of their sales. So they are screwed and sales would be 100% profit. If you bought that card for cash at card show a year ago or whatever for $500 and now sold for $1k good luck with those records when you were just doing this a hobby. I know chances are slim you will ever get audited or caught but if you hit the lottery and get picked they will look into everything you have on taxes.

[jdhaugh11]

Originally Posted by hermanotarjeta

Don't forget that some people in this country pay up to 53% income tax.

People might be at this tax rate, but if they are actually paying this percent, then they need to find a new accountant.
I realize most don't have 4 kids like I do, but I essentially get everything back at the end of the year & this is with basic deductions.

[rats60]

Originally Posted by jdhaugh11

People might be at this tax rate, but if they are actually paying this percent, then they need to find a new accountant.
I realize most don't have 4 kids like I do, but I essentially get everything back at the end of the year & this is with basic deductions.

It is because you have 4 kids. They don't need to hire an accountant to figure that out.

[rats60]

Originally Posted by SetBuildingGuy

Wow i never considered accepting or paying with anything but cash at a card show. Guess im old now.

I am old, but it has always been that way. I always took credit cards, even back in the 1980s. When PayPal came around, that was accepted too. I suppose if I was still doing shows, I might even take Crypto. The more types of payments you accept, the more likely you are to get the sale. That is basic Business 101.

[notfast]

Originally Posted by pewe

I guess the challenge with cash, and why most business moved away from it include:
-- buyer: you need to have enough when you discover something unexpected you want to buy
-- seller: you miss out on sales to people who don't use cash or don't have enough for something that they could cover digitally
-- you are a target to have it stolen (and not just by an external thief... if you have employees, the graft and shrinkage can be material)
-- you need to make extra trips to/from a bank to deal with it
-- accounting is a pain and probably much more costly

Cash will always be king at card shows.

[mossoholic]

Originally Posted by notfast

Cash will always be king at card shows.

Big gains sure. Don't know why anyone taking big losses would want cash. Unless it works out to the same money or more. Taking less for cash than any other payment method when already taking a big loss makes no sense.