Jesse (now 37 years old)owns a collection of "action figures" that he acquired when he was a teenager.He had forgotten about them until his mother sent them to him.She had discovered them in a box in her attic while she was cleaning out her house before selling it.Jesse had originally acquired all the action figures as gifts from his parents,so he has no way to establish a basis for the action figures.Using information from the Internet,he prepares a careful inventory of the action figures that includes their name,when they were first available for sale,their current value,and other pertinent information.He then lists them for sale on the Internet.To his surprise,he quickly gets an offer of $5,000 for them and sells them.Jesse has no other gain or loss transactions for the year and is in the 28% marginal tax bracket.What issues do these facts create?

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The Answer of Jesse (now 37 years old)owns a collection of "action figures" that he acquired when he was a teenager.He had forgotten about them until his mother sent them to him.She had discovered them in a box in her attic while she was cleaning out her house before selling it.Jesse had originally acquired all the action figures as gifts from his parents,so he has no way to establish a basis for the action figures.Using information from the Internet,he prepares a careful inventory of the action figures that includes their name,when they were first available for sale,their current value,and other pertinent information.He then lists them for sale on the Internet.To his surprise,he quickly gets an offer of $5,000 for them and sells them.Jesse has no other gain or loss transactions for the year and is in the 28% marginal tax bracket.What issues do these facts create?

Jesse (Now 37 Years Old)owns a Collection of "Action Figures