Q&A: Do I have to pay tax on a family heirloom sold on eBay?

Q:  If I sell a family handed down 1700’s grandfather clock on eBay, do I have to pay income tax on it?

A:  Good question!

There are different tax rules for selling on eBay, depending on whether you are conducting a business, selling as a hobby, or selling collectibles.

For purposes of answering this question, I’m assuming that you are not in the business of selling grandfather clocks or other antiques on eBay.  If this is true for you, then you fall into the “selling collectibles” category.

Generally, if you are selling collectibles (artwork, stamps, coins, etc.) on eBay, then you report your gain on the sale on Schedule D, Capital Gain or Loss.  The capital gains rate for collectibles is 28 percent.  Losses are not deductible.

For more information, see IRS Publication 550, Sale of Investment Property.

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