HR Slugger is a professional baseball player in a Major League Baseball league. He is a...

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HR Slugger is a professional baseball player in a Major LeagueBaseball league. He is a well-known player and is very popularthroughout the league, but especially with the local fans. Much ofhis population is based on his hitting ability, specificallyregarding home runs. The issue emerges from the following facts,similar to an actual situation you may have heard of.
• After days of intense anticipation by sports fans and wintersthroughout the league, Slugger hits a home run that brakes therecord for total home runs during a regular season. The recordbroken had been in place for 45 years. This is a major event inMLB.
• The homerun ball was hit out of the ball park. It was actuallycaught outside the playing field by a 14-year-old girl who is,along with her parents, a big fan of HR Slugger and the team.
• League policy is that in such a situation, the ball belongs tothe person that obtains the ball.
• Given the circumstances (a long-term home run record broken),the subject ball is immediately very valuable. Estimated valuecould be $5000,000-$1,000,000, possibly more.
• The girl and her parents are very proud of the catch and planto add the ball their sports memorabilia to be treasured for yearsto come. As it happens, the parents are clients of yours, and theycome to you for advice.
Issue: Does the event described result in any kind of taxissue?
What is your advice to them?
Include factual/legal analysis, including authority for aconclusion.

Answer & Explanation Solved by verified expert

3.7 Ratings (373 Votes)

Issue Since the ball has been kept by girl and her parents as a sports memorabilia or otherwise called collectibles therefore there will be no tax issue in the current year However if on a See Answer

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Transcribed Image Text

HR Slugger is a professional baseball player in a Major LeagueBaseball league. He is a well-known player and is very popularthroughout the league, but especially with the local fans. Much ofhis population is based on his hitting ability, specificallyregarding home runs. The issue emerges from the following facts,similar to an actual situation you may have heard of.• After days of intense anticipation by sports fans and wintersthroughout the league, Slugger hits a home run that brakes therecord for total home runs during a regular season. The recordbroken had been in place for 45 years. This is a major event inMLB.• The homerun ball was hit out of the ball park. It was actuallycaught outside the playing field by a 14-year-old girl who is,along with her parents, a big fan of HR Slugger and the team.• League policy is that in such a situation, the ball belongs tothe person that obtains the ball.• Given the circumstances (a long-term home run record broken),the subject ball is immediately very valuable. Estimated valuecould be $5000,000-$1,000,000, possibly more.• The girl and her parents are very proud of the catch and planto add the ball their sports memorabilia to be treasured for yearsto come. As it happens, the parents are clients of yours, and theycome to you for advice.Issue: Does the event described result in any kind of taxissue?What is your advice to them?Include factual/legal analysis, including authority for aconclusion.