RV cost basis for Capital gains

[Auburntsts]

Got kinda an off the wall question for those that have sold an RV. If you built your plane how did you determine your cost basis in order to figure out any potential capital gains as a result of the sale? To be clear I’m not asking whether one should or shouldn’t pay capital gains tax on the profit from the sale. Rather I’m interested in simply how one determines the cost basis of what was originally just pieces parts and sub components that eventually became a single end item.

[Richard Connell]

Kit cost plus your labor.
2000h at $100 per hour sounds fair.

[FORANE]

The above reply might be compliant with Australian tax law. It wouldn't be in the us.

[Richard Connell]

Sorry. It was tongue in cheek.
Internet not the best place to ask for tax advice imho.

[Snowflake]

I'd hazard a guess that even 2000 hours at minimum wage, on top of the cost of every component in the airplane, would be more than the aircraft is worth on the open market. How do you have capital gains on a depreciating asset?

[Mistfarer]

Originally Posted by Snowflake

I'd hazard a guess that even 2000 hours at minimum wage, on top of the cost of every component in the airplane, would be more than the aircraft is worth on the open market. How do you have capital gains on a depreciating asset?

Well... how about declaring the sale of the plane as a capital loss, hence getting a tax rebate next time you make some actual capital gains...?

Maybe I should try that when I sell my crusty old car...

[BruceW]

Watching this thread.
Kind of creepy that I was just thinking of this subject yesterday.
Im in CA so it matters even more.

[hgerhardt]

You should be able to add the cost of ongoing maintenance and upgrades to the basis, just like you can with real estate.

[MacCool]

Originally Posted by Richard Connell

Sorry. It was tongue in cheek.
Internet not the best place to ask for tax advice imho.

Absolutely. This subject has "audit" written all over it. Consultation with an actual tax professional now will likely avoid having to try to justify it to an IRS agent later.

[FlyingDiver]

Originally Posted by hgerhardt

You should be able to add the cost of ongoing maintenance and upgrades to the basis, just like you can with real estate.

Only capital improvements. You cannot add maintenance to your cost basis.