Another budget question.

In reply to Crazier :

Here's an example...

Lets say my neighbor is selling a car.  He wants $1000 for the car, but its sitting on a really nice trailer, and he wants to sell them both.  He wants $3000 for the trailer.

I don't need a trailer.  I've got one.  But I really want the car.  I sucker Stampie into buying the trailer, and we both walk across the street and make the deal.  I pay $1K for the car, Stampie pays $3K for the trailer.

My budget says $1K.  No trading, no recoup.

Stampie has a $3K trailer, and he still has no berkeleying carburetor.

SVreX (Forum Supporter) said:

In reply to Crazier :

Here's an example...

Lets say my neighbor is selling a car.  He wants $1000 for the car, but its sitting on a really nice trailer, and he wants to sell them both.  He wants $3000 for the trailer.

I don't need a trailer.  I've got one.  But I really want the car.  I sucker Stampie into buying the trailer, and we both walk across the street and make the deal.  I pay $1K for the car, Stampie pays $3K for the trailer.

My budget says $1K.  No trading, no recoup.

Stampie has a $3K trailer, and he still has no berkeleying carburetor.

Does the trailer have a dovetail and are ramps included? I'll give Stampie $3,000 plus an old carburetor for it now, but you better have a recept that says $1,000 for the car and not $4,000 for a car and trailer.

Crazier said:

In reply to SVreX (Forum Supporter) :

"My buddy and I bought a lot of parts containing a megasquirt an intake, fuel rails, TB and injectors.

I gave $275 for the computer and he gave $500 for the intake parts"

I wish it was simple. But it is not.

I have dicumentation for the parts lot at $775 shipped.

If you paid $775 for the whole lot, and then you sold the intake parts for $500, get a receipt from the buyer for $500 and you are left with a $275 computer. It looks pretty straight forward to me. The $500 should go towards your $1000 recoup limit.

Anything smaller than an 850 is a micro squirt not a mega squirt. 

In reply to AAZCD (Forum Supporter) :

Agreed!  Haha!

In reply to SVreX (Forum Supporter) :

Yes. If I had originaly gone into it for a challenge car I would have.

But I originally bought it to flip.

I buy sell and trade parts all the time that have nothing to do with the challenge. And getting challenge worthy documentation in every transaction gets complicated.

So. I would like to budget it at $275 as that is all I paid for it. But I can't prove that without having a recepit made up after the fact and even then it would look like a sweetheart deal. So I asked if the pro rate method was the right way to go and if I understood the equations correctly.

In my mind buying something that retails for $900 for $275 from a friend is a lot sketchier than a self trade of two equal value items to yourself.

In reply to DeadSkunk (Warren) :

Recoup is long gone

And... Had I purchased the entire lot myself id have gotten at least $700 out if the intake stuff... Maybe even 8 or 9. It was brand new with a retail of about $1300

In reply to Crazier :

I hear you.

It's beyond my paygrade.  Best to wait for clarification.  But keep it simple- don't over complicate it.

In reply to Crazier :

Just note...

You keep saying someone else bought that stuff. (your buddy)

It doesn't sound to me like you bought a lot.  It sounds like you and your buddy went together on a deal because he wanted some stuff, and you wanted other.  It's more like you bought PART of what was for sale.

And the bigger deal (in my opinion), is that $275 is HONEST.  It doesn't matter if it sounds sketchy if its honest.  You got a good deal.  That's great.

Wait for Tom to answer.

Okay, if you don't have a receipt from the seller, then that $275 is irrelevant and you should value the part at FMV. You wouldn't be able to claim a parts lot because you don't have a receipt from purchasing the parts lot. 
 

And to clarify: Yes, you can self-trade at fair market value, but that transaction would be separate from how the original part got into the budget sheet. 

I'm still fuzzy on the details (it's 8:30PM on a Friday, after all....), but I think your budget will end up with a FMV computer that you then traded with yourself for something with an equal FMV. 

Its late for Tom.

So I will wait for tomorow to ask about the definition of a fair market value self trade.

Let me say that I started reading this thread at 8am taking my morning E36 M3.  I was confused about what was going on.  I revisited it mid day and was still confused.  Now it's 9pm and I'm still confused but I'm also two whiskeys in.  As far as deals not for Challenge I get a receipt for everything even if it's a simple text confirming what I paid.

Tom Suddard said:

And to clarify: Yes, you can self-trade at fair market value, but that transaction would be separate from how the original part got into the budget sheet.

Exactly what I came here to say. Thanks for the official reply, Tom!

In reply to AngryCorvair (Forum Supporter) :

But what does that mean?

I have a part on my car (physically attached) and its in my budget already and I want to self trade it for another part of a similar value....

If you had a megasquirt, and I said "hey corvair, would you trade me for this painless harness" and you said "sure Rob the MS is way more complicated to set up, I would rather have a  simpler install"

No one would question it even if you were my dad or if we were lovers, because both parts are unused and have a nearly identical retail.

It would be considered a "related part" because the part I traded for it would on the car and it would go in my budget for the price I paid for the item I traded you.

But since I self traded it is now considered an unrelated part and isnt eligible to be traded?

So if I sold my mega squirt to you for $500 and then traded you for my painless harness that also would result in the mega squirt going into my budget at the price I paid for the painless harness.

If I bought the painless harness and an intercooler together, and put them in my budget as one price then I self trade the harness for the MS then the MS would be from a related parts purchase, because I was still using the intercooler. And so would be eligible for a self trade because the items traded had the same FMV?

In reply to Stampie (FS) :

If i think a part may end up being challenge related, i usually take a pic the receipt or a screen of the sale post... I lose absolutely everything! Most times now i post the digital copy in my build thread i used to just store them on photobucket... But i find it near imposible to deal with recently

In reply to Crazier :

I am waiting for the clarification too.  It sounds like Tom is about to turn things around from the way I understand it...

It seems like the sticking point is somewhere between here:

You may not list fair market value instead of purchase price on your budget unless you do not have a receipt from the purchase, or depreciation/appreciation has drastically affected the car or part’s value. 

and here:

You may not factor gains or losses made from buying, selling or trading unrelated parts into your budget. You may sell or trade parts to yourself for fair market value.

So, the rules pretty clearly say you can't list FMV instead of purchase price, UNLESS you don't have a receipt.  You don't have a receipt, so I guess you can use FMV.  (Also says appreciation/ depreciation, but that is not your case).  The loophole in this wording is that it seems to make an incentive for losing a receipt.  No receipt= I get to use FMV.  I don't think that was the intent (but it does exist).  Maybe there is a case here for losing receipts on everything... 

Then, the rules say you can't factor in gains and losses from buying parts.  The loophole is that it says "unrelated".  Your wiring harness did not come with the car, did not end on the car, and apparently was never really installed on the car, so it would seem "unrelated" to the car, BUT at some point in the middle of the project, it WAS considered for the build, which makes it "related".  Sort of.  This is a pretty loose interpretation, but its definitely a loophole.

Then comes the example..

If you bought an engine last week for $800, but the fair market value is actually $200, you must still add it to your budget at $800. 

If, 30 years ago, you bought an engine for $800, you may add it to your budget at today’s fair market value if you desire to.

The first part of the example doesn't help you a lot, because it assumes you OVERPAID for the item, and therefore DO NOT want to add the purchase price to your budget.  That's not allowed.  But it doesn't consider that you UNDERPAID, and would LIKE to add it to your budget so you can trade it and add a "gain" to your budget.  This seems to have been disallowed previously, if it wasn't for the "unrelated parts" loophole.  Since your part may be "related", all of the "thou shalt nots" seem to be over-riden.

The second part of the example is clear as mud, because it says you can use FMV "if you desire to".

Between "losing" receipts, defining "related" parts, underpaying to gain trading advantages, and the freedom to "choose" whether or not to use FMV, it's quite a festival of loopholes.

Gonna have to wait for Tom on this one.  But I do understand what you are struggling with.

Crazier Said : I have a part on my car (physically attached) and its in my budget already and I want to self trade it for another part of a similar value....

Yes, you can do this. You can only trade with yourself at FMV, purchase price(s) aren't part of the self-trade equation.

So yes, if you buy a widget for $50 and bolt it on your car, you can trade it with yourself for something worth $1000 as long as the widget's FMV is also $1000. That would get a $1000 item onto your car for $50.

Remember, though, that your FMV calculations need to be robust enough to withstand any protests. It's Fair market value, not "what's the cheapest or most expensive transaction I could possibly find" 

In reply to Tom Suddard :

Well now I definitely need to get to the challenge this year, as I have a proposal to bring up at the town hall meeting. 

In reply to Crazier :

Did you just break up with me?!?!

captdownshift (Forum Supporter) said:

In reply to Tom Suddard :

Well now I definitely need to get to the challenge this year, as I have a proposal to bring up at the town hall meeting. 

The 'Monzora Rule'?

there is only one place to get a megasquirt.

So there is not a lot of wiggle room on value.

You have to remeber that MS while being very capable is universal and requires a TON of set up and additional conectors. This keeps its price low.additionaly there is only one place to get a 3800 stand alone harness.

There is only a $30 difference in their retail values and this is more than made up for by the addition of the stock computer that has VATs removed for stand alone operation.

Unless this is disputed?

That gets the MS as part of my build and into the budget at the price I paid for the stand alone harness and makes it a legal trade for the parts lot from Tyler.

And at that point, I would have the parts lot into the project at the price I paid for the stand alone harness.

In reply to AngryCorvair (Forum Supporter) :

We can have an emotional affair... I'm celibate.

In reply to AAZCD (Forum Supporter) :

I'm thinking calling it the shift knob and oil cap rule. As some shift knobs and oil caps go for north of $200 for some unknown reason and yet with the right waiting hunting searching and some luck, you can score them at the junkyard for between 3 and $12. I could buy one say that I'm going to put it on my car and then decide no and trade it for something that's fair market value and get something that's worth $200 for $3. That's not within the spirit of the rules. 

My rule proposal would be if you purchase something for your build and it's never been on the vehicle during a challenge, then it's ineligible for horse trading (unless it was part of a parts lot that you purchased that is part of your challenge budget and your recouping off of selling certain things from that parts lot and some of the items from that parts lot are on the car) but basically the rule would be if something has never been on the vehicle and nothing regarding and purchase of it is on the vehicle, that it's ineligible for recoup. Intent to possibly or potentially use on the vehicle at some point in time be damned. 

My thought regarding intent versus actually going on and recoup is congratulations you just covered your hotel cost and or entry into the event.