While using a metal detector at the beach during spring break,Toni uncovered some rare coins with a current fair market value of $9,000.What are her tax consequences regarding this find?
A)Because it was a "find" she only reports half of the FMV as income.
B)She reports the entire FMV as income.
C)Since she "found" the coins,she does not have to report any amount of income until she sells the coins.
D)Under the discovery rules in the tax law,she will never report any amount as taxable since the value is under $10,000.

Question

Quizplus · Accepted Answer

According to the IRS, if you find and keep property that does not belong to you and that has been lost or abandoned (including by simply discovering treasure on public property, such as a beach), it is not excluded from your income and must be reported on your tax return. Therefore, Toni must report the entire fair market value of the coins as income.

While Using a Metal Detector at the Beach During Spring