TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Saturday, November 30, 2013

Tax Consequences of the Sale of a Testicle

Forbes:  This Man's Nuts: Plan To Sell Testicle For New Car Is Taxable, by Kelly Phillips Erb:

Would you sell a body part for a new car?

Mark Parisi would. He appeared on CBS’ show The Doctors to discuss with the panel his plans to sell his left testicle for $35,000. But he’s not selling his testicle for any old reason: he wants a new car. Specifically, he wants a Nissan 370Z, described on Nissan’s website as “a serious car for serious drivers.” Agreed. You have to be pretty serious to want to sell a body part in order to buy a new car. Luckily for Mr. Parisi, the sticker price for the Z cars hovers between $30,000 and $45,000. ...

Assuming his story is accurate, he is being compensated $35,000 to participate in a medical study. That amount is taxable. In a case brought before the U.S. Tax Court last year, O’Connor v. Commissioner (T.C. Memo 2012-317) the ruling emphasized that the section 61(a) of the Tax Codes defines gross income as “all income from whatever source derived unless otherwise excluded by the Internal Revenue Code.” Taxpayer made a few arguments that the payments were excludable: first, as a payment received on account of physical illness or physical sickness and alternatively, as gift. Both arguments by the taxpayer were rejected, as they would be for Parisi.... It is payment for services. And it is taxable.

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Isn't there a basis problem here?

Posted by: michael livingston | Nov 30, 2013 1:06:35 PM

How about long-term cap gain?

Posted by: D | Nov 30, 2013 7:09:29 PM

I just found a way to pay off my student loans.

Posted by: Nick | Dec 3, 2013 11:10:52 AM

I think this blog may have just jumped the shark.

Posted by: TexEcon | Dec 4, 2013 8:15:03 AM