Archive: Fri Aug 10 14:51:50 2007
Title: Why is catching a baseball taxable income?
Music: Too Shy - Kajagoogoo
What a quagmire...
Ok, so yes, catching Bond's 756 homerun is a big deal, but does the ball have intrinsic value? Or is the value only there when the item is transfered?
The IRS wants to tax Bond's 756 home run ball as if the ball were worth $600,000 before Murphy caught it. If the ball had value before he caught it, then it would be the same as if someone had handed Murphy $600,000 cash, so he should be taxed accordingly.
But the problem is the ball itself did not have intrinsic value. If he sells it, then yes, he should be taxed on the gain of value from ~$0 to whatever sales price he gets. But to tax him before the sale implies that the ball had value when he caught it, which it didn't. It was just another baseball and worth no more or less than any other baseball tossed around that night. At the moment Murphy caught it, it was just a baseball. It only became valuable when caught and thus desired by others. He shouldn't be punished for catching the ball.
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