What’s that you say? Guitars as a tax shelter! We live such busy lives… did you know this?
Let’s talk about this interesting feature that drives the IRS crazy at the very mention of the word ‘tax shelter”. Guitars, when acquired thoughtfully, can appreciate in value over time. We have other articles that dive into the what/when/why and how guitars appreciate… so let’s stay focused on this tax topic for today. We can buy special guitars using cash, credit cards and trades… much like cars and boats. There are loans available as well however not from conventional sources like banks. Point being, they are widely accepted and valued commodities that are mainstream assets. So how can they benefit families and friends from a tax standpoint?
Guitars that are ‘gifted’ to others are not automatically subject to inheritance tax. As an example, at age 53-73-93, Jon Doe decides he needs to start planning his estate in order to minimize the tax burden his predecessors will face when he passes away. If he has a few guitars, he can simply hand them to the folks he chooses like a watch, car or property… with one exception… nobody pays inheritance tax if Jon does this discreetly. He could pass along an $85,000 Les Paul Custom that he acquired for $4,000 some time ago to a grandchild or anyone for that matter. Jon didn’t pay tax on the delta, nor did the recipient pay tax on the gift. Probate periods are avoided as well.
Try doing this with real estate, cars and stock portfolios…
Borrow Against Guitars – Guitar investors/collectors come in all shapes and forms. Well healed, knowledgeable people that enjoy the “art” and playability of fine instruments, artists that perform and create fantastic music that demand the very best and regular folks that simply adore guitars.
We want to ensure your hard-earned collections are respected, valued and allow for some financial flexibility without the pain or frustration banks put us all through… fast, friendly and seamless with respect and integrity. What a concept!
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Please note: I am not an accountant nor do I claim to advise folks on important tax matters. Please check with your tax and accounting professionals to determine the value this article brings to light.
