Billy, Age 10, Found an Old Baseball Glove While Exploring

question 815

Essay

Billy, age 10, found an old baseball glove while exploring his new home. His father, Al, took the glove to a dealer in baseball memorabilia who verified that the glove belonged to Babe Ruth. Al sold the glove for $75,000. What tax issues should Al consider?

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Definitions:

Acid-test Ratio

A stringent indicator of a company's ability to quickly convert its short-term assets into cash to cover short-term liabilities, excluding inventory.