Can my wife buy my asset so I get a capital loss?

Years ago I lent someone money, secured by jewelry. He defaulted and I got the jewelry. At the time I was covered, but the market has declined so I am out about 50%. I have given the jewelry to a jeweler who is selling it off very slowly. I understand I cannot take a loss until it is all sold.
Could my wife buy it at a fair market value so I can take the loss? I would be out the sales tax, but it would be worth it. We file a joint return, but I own it.
I have absolutely NO interest in anything the IRS is going to give me a hard time over.
Reply to
Confused
You have yet to exhaust your remedies - like Craigslist, Ebay, etc. I agree it's not fair, but what is?
As for your wife buying it, that's a relaed party transaction, the equivalent of a wash sale, and might be considered to be what the IRS call a Badge of Fraud.
My advice is "Don't think about it further."
Dick
Reply to
Dick Adams
Why can't you take a loss as each piece is sold? I think this is doable. If you bought 100 shares of XYZ and sell 10, you take gain/ loss on those 10, then if you sell another 10 you take gain/loss on this 10 shares sold.
Anyway you can only deduct 3k of loss each year (the rest is carried over).
No, sounds like you're selling stock to yourself to realize a loss.
Reply to
removeps-groups
There is a specific, single amount owed and the jewelry is security. I doubt that the loan could be divided into shares and treated as separate loans, though you might try it.
To do that OP would have to have each piece appraised as of the date of the original loan.
___ Stu
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Reply to
Stuart A. Bronstein
On Jan 24, 11:40 am, "Stuart A. Bronstein" wrote:
If he was given identical pieces (like someone posted about gems a while ago) then it would be easy.
Reply to
removeps-groups
No, you absolutely cannot sell the jewelry to your spouse and recognize a loss. IRC Sec. 267(a)(1), (b)(1) and (c)(4).
Katie in San Diego
Reply to
Katie in San Diego

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