Jul 5, 2015

The Need for Estate Sale Operator Licensing

The headline of the consumer complaint post was brash: “They literally stole our whole house: they sold $42,527 worth of items and gave us a check for $1,682.” The details of this homeowners’ plight were tragic: he had been “ripped off” by an estate sale company.

According to the story on ripoffreport.com (specific company/client has been redacted due to liability concerns), the complainant had a 10-room, five-bedroom home filled with expensive furnishings, including dozens of pieces of Waterford crystal, Hutschenreuther fine china, unique decorative pieces, a piano and fine furniture. The estimated market value of the contents was $42,527. Said the homeowner: “On the (liquidator’s) final report, 80 percent of the items were missing and unaccounted for—they just disappeared. They offered me a cash payment of $1,682 for the entire household and lame excuses and blatant lies for the missing items that I directly questioned them on.”

The estate sale business is booming, and more new companies entering the field will result in still more complaints from consumers. Unfortunately, the estate liquidation industry is largely unregulated, as estate tag sale liquidators are not required to be licensed.

The estate sale business is booming, and more new companies entering the field will result in still more complaints from consumers. Unfortunately, the estate liquidation industry is largely unregulated, as estate tag sale liquidators are not required to be licensed.

Today, there are more than one hundred such companies operating in the same area. Such rapid growth is consistent throughout the United States. According to the Department of Health and Human Services, the 40 million citizens over the age of 65 rose 15 percent from 2000 to 2010. By 2030, it is expected that the number of Americans older than the age of 65 will rise to 72 million. The rising demand for estate liquidation services has caused many companies to enter the field, and many more will be added in the next decade. >>> Read More

Jul 3, 2015

Five Steps to Take When the Liquidation Company Says No

It’s a common occurrence: an executor calls an estate sale company to provide an estimate for liquidating an estate’s personal property and the liquidation company says “no thanks.”

Why does this happen, and what can an executor do when it does?

It happens because liquidating an estate’s personal property can be a monumental job, and there has to be enough high-dollar goods available to make that job worthwhile for a liquidation company. Once an estate’s heirs have claimed their “due” and stripped an estate of its most valuable assets all that’s left for an estate sale company is “the dregs.” There’s often not enough money in run-of-the-mill household goods to be a profitable undertaking for a liquidation company.

There’s often not enough money in run-of-the-mill household goods to be a profitable undertaking for a liquidation company. If this happens, there are other steps you can take.
There’s often not enough money in run-of-the-mill household goods to be a profitable undertaking for a liquidation company. If this happens, there are other steps you can take.

Even when the heirs aren’t interested in an estate’s personal property, some estates just aren’t worth the trouble. Other estates may seem like a lost cause, but how is an executor to know for sure? What if an executor has everything hauled off to Goodwill, only to find out from nephew Bill that there were about a dozen out-of-print first editions on the bookshelf, and that the framed 45 RPM record by Tony Sheridan and the Beat Brothers wasn’t an old high school buddy’s band, but rather an early iteration of The Beatles? >>> Read More

Jul 1, 2015

Why Millennials Don't Want Their Parents Stuff

There was a time when prosperous Americans eschewed durable consumer goods. Rarely would they buy a mass-produced sofa or dining set. Instead, they bought functional antiques that would hold their value from generation to generation and not be fodder for the dump in six or seven years. Take the DuPont’s of Delaware, for example. The Winterthur Museum (a former DuPont estate) houses one of the finest collections of antique furniture in America. The estate wasn’t furnished with antiques for their artistic value, but rather for day-to-day use.

Baby Boomers are getting stuck with family treasures because today’s Millennials—the next generation of heirs for these goods—don’t want them. So, how does one go about getting rid of these items that, in generations past, were passed down to the younger generations?
Baby Boomers are getting stuck with family treasures because today’s Millennials—the next generation of heirs for these goods—don’t want them. So, how does one go about getting rid of these items that, in generations past, were passed down to the younger generations?

For generations, antiques were passed among family members as part of an estate. With each generation, well-cared-for antiques became more treasured and heirs were almost always glad to get them.

America’s middle-class homes followed the same pattern: a family’s “treasures” were passed from generation to generation, even if the treasures were modest. Ultimately, the homes of Baby Boomers became repositories for the trappings of several generations of collectors and hoarders.

It seems like the Boomers will be stuck with these “treasures,” too, because today’s Millennials—the next generation of heirs for these goods—don’t want them. Marketing polls in recent years have “sliced and diced” the psyche of Millennials, and determined that (for the most part) they just don’t want their parent’s “stuff.” They don’t want the overstuffed furniture, they don’t want the boxes of memorabilia, and they don’t want great-grandma’s mahogany secretary. >>> Read More

Jun 29, 2015

When Does a Hobby Become a Business?

It was apparent from the wording of his forum post that Ben was overwrought. He had just received a 1099-K from eBay and feared that he would owe the IRS a lot of money. Ben wanted forum members to advise him on how he could maneuver through his difficulty.

It seems that Ben’s uncle had passed away, and a cousin (the estate executor) wanted Ben’s help in liquidating a garage, basement and closets full of 35 years’ worth of auction acquisitions. The family was aware that Ben was an active eBay seller, and they felt he was the ideal resource for selling the items. Out of a sense of family obligation, Ben accepted the job. The estate would pay him a modest fee for his help. But the proceeds from the estate sale added to his recurring eBay income lifted Ben above the $20,000 in payments and 200 transactions needed to generate a 1099-K. The amount he would likely owe exceeded the amount the estate had paid him, and since the estate was now closed out, there was no money available to cover the shortfall.

According to Ben, his eBay selling had never before reached this sales level. Although he admitted to regularly profiting from his selling activities, Ben claimed that eBay selling was “only a hobby,” and he felt that it was grossly unfair that the government should treat him as a business, and that eBay should issue him a 1099-K. >>> Read More

Jun 27, 2015

Slippery Slope: Employee Mis-classifications Lead to Crackdown

A vintage furniture dealer I’m aware of is on a “slippery slope” that may land him in jail. His transgressions? There are several, but the most serious is designating employees as independent contractors that should be classified as employees.
In their search for more revenue, federal and state governments are cracking down on business owners who mis-classify employees, as well as independent contractors who don’t claim all their income. And the penalties for doing so can be serious.
In a 2014 interview, attorney Jeffrey Davine, a partner with Mitchell Silberberg & Knupp LLP, told the website Law360: “If a business mis-classifies a worker and the government ultimately finds they should have been an employee, in theory, the business is responsible for paying all taxes they should have withheld, plus the mis-classified employee’s share, plus interest and penalties … If you multiply that by several employees and several years, the business could be looking at a devastating tax liability.” 

In the same article, Michael Fried, a partner with Fried & Rosefelt LLC, states:

“More recently I’ve seen common, everyday problems turn into criminal prosecutions, as opposed to staying in just the civil arena … In the past you had to really work hard to get criminally prosecuted for failure to pay employment withholding taxes.”

Not any more, apparently. >>>Read More