The Historic Home Run Ball Tax?

You catch Alex Rodriguez’ 500th home run ball. Or Barry Bonds’ 756th. Or Ken Griffey Junior’s 600th. Does the IRS want to talk to you?

Now that the value of historic baseball memorabilia–even new stuff–is pretty much common knowledge, it was inevitable someone would look into how the windfall of catching a valuable ball might impact one’s tax situation.

Will the Internal Revenue Service require the lucky fan to pay tax immediately, based upon the ball’s estimated fair-market value? Or only after the fan sells the ball? Will the fan have to pay tax based on regular federal income-tax rates? Or, if the fan waits to sell the ball for more than a year after catching it, would any profit qualify as a long-term capital gain taxed at the maximum rate of 28% on collectibles?

It’s all heady stuff which means we must now turn things over to the Wall Street Journal, which is better at trying to sort these things out.