Subject to change at any moment... Capitol Gains tax is 15%, but Collectibles are taxed at 28%. The tax code may define sales of your collector cars as either Capitols Gains or the higher rate specifically for Collectibles.

Internal Revenue Code has a definition for the term collectibles. The code is very specific, “Collectibles” are defined as any work of art; any rug or antique; any metal or gem; any stamp or coin; any alcoholic beverage. It doesn’t specifically define a car as a collectible. What about Antiques? Cars manufactured 1905-Present aren’t Antiques.

Work with your accountant; make sure that those cars you sold in the tax year are classified under the lower capitol gains tax and not the higher collectible tax rate.

The Secretary of the Treasury has the power to add automobiles to the definition at any time; that just hasn’t happened yet. Maybe tomorrow, but not yet, and it can’t be done by an IRS agent auditing your return.