$5.3m Patek Tiffany

[franklee168]

Since I missed out on the auction, I decided to buy the timex waterbury blue dial. Sending it to the auction after it arrives.

[2001jesper]

Originally Posted by GoingPlaces

At this level I doubt anyone is thinking taxes. Billion dollar companies with billion Dollar buyers. The buyer does not get the write off, they get a watch. PP or the owner of the watch gets the write off since they receive the money and donate all of it. Phillips pays taxes unless they donate their fee to said charity. Same money can’t be written off twice.

Originally Posted by vinny84

To my knowledge, you can not write off a charitable donation if you receive any goods or services. At least here in the US

They started off the auction stating that the buyer could write off any premium in excess of the retail price.

"Subject to local laws, the buyer of this Lot may be entitled to claim a charitable contribution deduction. Under IRS regulations, a deduction will be limited to the excess of the lot’s hammer price paid over its fair market value. Phillips good faith estimate of the Lot’s fair market value is USD $52,635. Bidders are strongly advised to consult their own tax advisors to determine the application of their local tax laws to their specific circumstances and whether a charitable contribution deduction is available to them.

Following the sale of the Lot, Phillips will provide the buyer with the Nature Conservancy’s contact information should the buyer wish to benefit from a charitable contribution deduction that may be available to them."

[GoingPlaces]

Originally Posted by 2001jesper

The started off the auction stating that the buyer could write off any premium in excess of the retail price.

"Subject to local laws, the buyer of this Lot may be entitled to claim a charitable contribution deduction. Under IRS regulations, a deduction will be limited to the excess of the lot’s hammer price paid over its fair market value. Phillips good faith estimate of the Lot’s fair market value is USD $52,635. Bidders are strongly advised to consult their own tax advisors to determine the application of their local tax laws to their specific circumstances and whether a charitable contribution deduction is available to them.

Following the sale of the Lot, Phillips will provide the buyer with the Nature Conservancy’s contact information should the buyer wish to benefit from a charitable contribution deduction that may be available to them."

So then the buyer gets the write off and not seller. Interesting.


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[steeevvvooo]

Originally Posted by 2001jesper

Phillips good faith estimate of the Lot’s fair market value is USD $52,635

On what basis is that “fair market value”!? Funniest thing I have heard for a long time. What a racket!!


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[samuel019]

Originally Posted by padi56

Agree seems like today some have more money than sense.

Originally Posted by DLRIDES

I understand there is wealth to such a degree that $5.3 mil is literally meaningless, and I am happy for their success !


But, a person that would pay $5.3 mil for a $40k watch just to prove some kind of deranged point ………………….. is mentally insecure to the point of insanity.

IMO

Have to agree. Sorry

As a watch lover, even if I were a billionaire I cant see myself paying this kind of money. Who knows maybe if I were a billionaire I'd have a different opinion but I doubt it.

I think I'd be better suited if I were a billionaire/watch lover doing the things that would get me selected versus going this crazy route. All if's and but's and candy and nut's at this point

[subtona]

Originally Posted by johnwigan

No, everybody does not win. People who pay these inflated prices and then a couple of years down the line find their 'investment' is worth a fraction of what they paid lose.

Everyone wins is never true. Prices can down. People can - and I think will - lose a lot of money. Also, not great if you just want to buy a watch to wear These boards are more about money-making, than watches these days. Hence, prices increases are deemed a good thing. The charity got a lot of money though, which is good.

The watches are being treated like a commodity so it’s to be expected they are accompanied by the associated risks.

Anyone not interested in seeking to profit or pay over retail won’t expose themselves to the risk.

[PPOnlyT-Stamps]

Watch collecting has reached a new level of appreciation and admiration from the community. Ever since the auction of THE ONLY ONE at $31M, people wondered if that was the peak. Today marks a time where everyone will realize that these premiums are here to stay and going forward, watches are a new asset class just as valuable if not more practical than fine art! At least I can wear my watches and not have it hang on the wall…

[miamiclay]

I don’t think the buyer (if a US taxpayer) would get away with deducting the full difference between $6,503,500 total paid and that $52,635 Phillips “estimate” as a charitable deduction.

In this instance, I’d expect “fair market value” to be determined by the next several public auction prices. E.g., if the next few of these were to sell at an average of $1 million each, I think the buyer of this one could legitimately claim a charitable deduction for the extra difference paid, or $5,503,500.

(This is not tax advice, and I am definitely *not* your lawyer.)

[Bearxj86]

If the definition of insanity is doing the same thing over and over again expecting a different outcome, then none of this is insane; actually by definition - we are insane lol

We here at TRF have seen the 5711 go from $20k to possibly $200k

Under the definition of Veblen goods this is nothing

[vh2k]

It was exhilarating in person — especially when the bid hit $5.0 million and, after a long pause, it went past $5.15 million. Tremendous excitement in the room.

[WILLIWALKER]

Originally Posted by epicurus

Tulip mania

more or less

[Recondope]

Great that the money went to charity but I cannot help but feel like this is another blow to hobbyists like myself that just enjoy watches for what they are. It seems like they are being treated more as commodities these days. Jmho.

[sinkholeninja]

A collector that goes by the handle “santa_laura” on Instagram bought it.

[HMHM]

Originally Posted by sinkholeninja

A collector that goes by the handle “santa_laura” on Instagram bought it.

But Santa_laura is based in Singapore though? Hodinkee said it was bought by a New York based bidder?

[brkn]

Originally Posted by HMHM

But Santa_laura is based in Singapore though? Hodinkee said it was bought by a New York based bidder?

*from Singapore. might be based in NY.

[Token74]

Originally Posted by samuel019

Have to agree. Sorry

As a watch lover, even if I were a billionaire I cant see myself paying this kind of money. Who knows maybe if I were a billionaire I'd have a different opinion but I doubt it.

I think I'd be better suited if I were a billionaire/watch lover doing the things that would get me selected versus going this crazy route. All if's and but's and candy and nut's at this point

Your logic is good but in reality it doesn’t work this way. $5m is relative pennies to a billionaire, check out the running costs of a super-yacht or a major sports team or a private jet.

The experience of winning at such an auction would be so much better than being offered the chance to buy at retail.

I don’t really know why people can’t just be happy for them and enjoy the entertainment. There’s a lot of folk out there (the majority of my friends included) that think it’s mental that we spend four figures on a watch, so everything is relative.


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[uniqueMR]

F*** You Money to a Different Level :)

[bob sims]

Originally Posted by sp5702

6MM with the buyer’s premium. Whoever paid that is going to take a bath on it long term.

Maybe.
Or they may make a million reselling next week.
Could also be an oil sheikh worth 7 billion to whom this is pocket change and a gift for one of his wives-or boy toys!

[huncho]

Originally Posted by Token74

Your logic is good but in reality it doesn’t work this way. $5m is relative pennies to a billionaire, check out the running costs of a super-yacht or a major sports team or a private jet.

The experience of winning at such an auction would be so much better than being offered the chance to buy at retail.

I don’t really know why people can’t just be happy for them and enjoy the entertainment. There’s a lot of folk out there (the majority of my friends included) that think it’s mental that we spend four figures on a watch, so everything is relative.


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yep, 5 million to someone who has 1 billion is 5000 to someone who has 1 million. it's hard to understand just how much 1 billion is. obviously not exactly that relative because it just takes into account liquid money and all that and the fact that 5 mil can get you so much more than 5000 but still goes to show how small it is to them

[scurfa]

Embarrassing for Tiffany not just Patek


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[MadSpaniard]

In all the bidding excitement they seem to have forgotten one thing. It looks ass.

[rolexjackson]

Originally Posted by MadSpaniard

In all the bidding excitement they seem to have forgotten one thing. It looks ass.

This


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[eanzenberg]

It’s a tax write off! What a joke. These guys donate $millions every year and now they get a watch for it. But not any watch, an asset they can sell in a few years for $millions more.

I hope the IRS was watching…

[Climaxoxo]

That is crazy

[77T]

Originally Posted by eanzenberg

It’s a tax write off! What a joke. These guys donate $millions every year and now they get a watch for it. But not any watch, an asset they can sell in a few years for $millions more.

I hope the IRS was watching…

It is a two-way write-off if both happen to be US taxpayers because of IRS’ Temporary Suspension of Limits on Certain Charitable Contributions.

In a charity auction as Christie’s structured it, the Patek’s contributor may claim the fair market value as the donation for them is property and not cash (in this case the MSRP). If the property has appreciated in value, however, some adjustments may have to be made.

The winner of the auction may deduct the hammer price (exclusive of Christie’s premium) up to 100% of their AGI for a qualified contribution minus the original fair market value. Complicated but legit. Therefore, there is no duplication of deductible value.

Until recently that was limited to 60% of AGI. Qualified Organizations
You may deduct a charitable contribution made to, or for the use of, any of the following organizations that otherwise are qualified under section 170(c) of the Internal Revenue Code. This is different than 501.c.3.’s:

- A state or United States possession (or political subdivision thereof), or the United States or the District of Columbia, if made exclusively for public purposes;
- A community chest, corporation, trust, fund, or foundation, organized or created in the United States or its possessions, or under the laws of the United States, any state, the District of Columbia or any possession of the United States, and organized and operated exclusively for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals;
- A church, synagogue, or other religious organization;
- A war veterans' organization or its post, auxiliary, trust, or foundation organized in the United States or its possessions;
- A nonprofit volunteer fire company;
A civil defense organization created under federal, state, or local law (this includes unreimbursed expenses of civil defense volunteers that are directly connected with and solely attributable to their volunteer services);
- A domestic fraternal society, operating under the lodge system, but only if the contribution is to be used exclusively for charitable purposes;
- A nonprofit cemetery company if the funds are irrevocably dedicated to the perpetual care of the cemetery as a whole and not a particular lot or mausoleum crypt.

So people who have AGI above $5-6 million won’t have a problem. The cost avoidance value after taxes would be around $2.5 million (my SWAG).

But I agree the idea of paying the hammer amount was somewhat excessive.


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[amanbra]

This is crazy but to a billionaire this is actually not that much money… esp when it’s also a tax deduction. Some of these folk donation millions for absolutely nothing in return anyway. Just a different world.


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[S``]

Originally Posted by bearxj86

If the definition of insanity is doing the same thing over and over again expecting a different outcome, then none of this is insane; actually by definition - we are insane lol

We here at TRF have seen the 5711 go from $20k to possibly $200k

Under the definition of Veblen goods this is nothing

A broken clock is right twice a day. One day the pullback crew will be RIGHT. Being wrong has zero impact on these forum

[fwhawk]

I was amazed by many of the results in this auction. It felt like many references (Patek references in many cases, but not exclusively) jumped up several levels!

[enjoythemusic]

I'd like to thank Patek Philippe for donating their efforts to help a great cause... and to the buyer who donated their capital.

[brandrea]

If this is what it takes to donate to charity, bring it.

Maybe they could set up the rest of the 169pcs to aid in other worthy causes such as food banks, homeless shelters and the rest.