Challenge budget re-coup questions

TL;DR: I don't think I can honestly put the Rice Rod in the Challenge while achieving my lofty awesome goals.

I have a complicated budget for the Rice Rod. It can be broken down into 3 big chunks. Chunk#1 is the Buick Roadmaster $2016 car. Its Challenge budget was $1,140 and some change. I traded Chunk#1 straight up for Chunk#2, the SC300. So the SC300 is worth $1,140 in my budget. Please stop me here if that is not right.

Chunk#3 is the Model A body. I paid $1,250 for it. Easy, no nonsense there.

Add up Chunk#2 and Chunk3: $2,390 and some change. The way I understand the rules is you only recoup up to $1,008 for the entire budget. Please stop me here if that's not right, because it's about to get complicated.

Let's go back to Chunk#1, the wagon. I did some significant recouping, mostly by selling the cats, exhaust parts, emissions junk, etc. Maybe $200 or so recouped, and is reflected in the $2016 budget. Does the $200 recoup from my $2016 car count towards my $2017 budget?

I am going to hit the recoup limit no matter what. This Lexus is the champion of part-outs. But I really want MS2 and either twin-turbos or motorcycle ITBs. Depending on the recoup questions above, I will probably have to settle for stock ECU and intake since it uses a MAF :(

I'm at neophyte so I'm probably not the one to speculate. Quick question. Are you going to sell any parts off of the model A such as fenders running boards Etc or are you you just using the cab

As a fellow challenger rookie my thoughts as to your 2016 wagon entry is that your model A is a completely new build and is only tied to the wagons FMV to "purchase" of the Lexus parts car so recoup on wagon parts don't count against you. Just my $.02

Putting aside 2016 challenge calculations what could you purchase the wagon and/or the Lexus for?

I for one I am in favor of any budget interpretations that allow you to build the model A within challenge rules. I certainly won't push protest you. LOL I'm just looking forward to seeing the finished product

I haven't seen the new rules yet to completely give my translation of the new rules.

Old rules would say that the $200 of recoup on the old car would count toward your overall recouping. This was so I can't buy 10 parts cars where I zero them out and trade them for one awesome car, or other parts I need. The max recoup is $1008.50, whether it is from car #1,2,3,4,5,6 I'm not sure what the record is for parts cars.

Unlimited recoup would allow me to open a junkyard and only use parts off cars I profited from allowing me to build anything and still be in the negatives.

Some would try to say your ending budget value would be your new FMV. This would allow someone to continue to recoup year after year which would be frowned upon. It would allow an additional $1000 to be spent every year you continue to bring the car to the competition.

You might be better off getting a consensus FMV on the SC300 and starting the build there. I would do research on book values and describe the condition of the SC300 to make your argument as to it's FMV.

The wagon had a value when you traded it for the SC300. IMO it doesn't matter how you arrived at that value. I believe that your recoup total should reset to $0.00 with the trade of the wagon for the SC300.

Stampie wrote: You might be better off getting a consensus FMV on the SC300 and starting the build there. I would do research on book values and describe the condition of the SC300 to make your argument as to it's FMV.

That's what I was trying to express above. Stampy just said it better. The rice Rod is a new-build unrelated to the wagon from 2016. If you had sold wagon for $4,000 and turned around and bought the SC300 the value of the wagon is irrelevant to the current build.

A couple of quick thoughts:

• The recoup rules for 2017 are not written yet- too early to answer.

• The way you described it doesn't really work. If you want the recoup parts from the wagon, you have to include the purchase of the wagon.

• The way Stampie and Angry described it MIGHT work. You need a FMV for the SC300, or one for the wagon at the moment it was sold.

• FMV does NOT always work in your favor. If the reality is that the SC300 was worth a lot more than you bought it for, THAT would be it's FMV. You don't get to declare something less just to fudge the numbers. FMV means fair market value, not declared value.

I think there must be a division between the wagon build and the SC300. There is value in the wagon above your monetary investment; this is against the rules because you are selling "parts" at a "profit"... even if no $$$ is actually changing hands.

As Stampie said, I think you need to FMV the SC300 and go from there. Howeve, I suspect a 5 speed SC300 will be greater than $2016 on its own. Maybe watch e-bay and find a similar car to get a real FMV?

Edit: BTW, I think SVreX and I are saying the same thing in different terms.

I've been mulling this over and I think what's missing here is the year's worth of labor I put into the wagon. That has value, which is not captured by the Challenge budget (or anyone's budget). That labor made my wagon worth the same as a 5-speed SC300, which is probably closer to $2,000 or more.

By trading the wagon, I have effectively "cashed out" the labor I put into it. Yes, the parts only add up to $1,140 but the labor would push the FMV past its Challenge budget. I think that is the case for most Challenge cars. Do you think the Nelsons would gladly hand over their 10-second cars for $2,000? No way, and neither would I.

I think I agree with Andy Neuman about the "total recoup" rule. What would stop me from fixing a few little things, buffing the paint, and trading the Lexus for something blatantly Challenge illegal? I could see this getting out of hand.

Whatever the case, the rules need clarification about flipping/trading past Challenge cars.

By the way, I am totally okay with this build not being Challenge-legal. It's one I've been dreaming about for years and I will complete it regardless of budget. I will probably enjoy it more without budget constraints honestly (Megaquirt+turbo here we come). The stars just happened to align when I found the perfect drivetrain donor owned by a seller that just happened to be looking for a wagon.

Your labor absolutely has value. The one thing no one has ever pursued is the "paper clip trade"- where you start with something as valueless as a paper clip, and keep trading up until you can trade for a house. It's legal in the rules (but a heck of a lot of work).

But to do this, you would have to include the original purchase price of the wagon in your budget.

You can't claim the recoup without including the purchase price.

I am re-reading your original post, and it MAY work, it's just not worded clearly.

You said your Challenge budget for the wagon was $1140. Is that the budget (incluing recoup, etc), or the purchase price?

The "chunks" description is confusing me.

Maybe if you wrote it out in chronological order (from the PURCHASE of the wagon), it would make more sense, instead of jumping back and forth between "chunks".

I actually think it works, just not clear. The wagon is just another parts car, and the total recoup does not exceed $1008.50, right? The question is, are you counting part of the recoup twice?

If you bought the wagon for $2K, put a bunch of labor in it, recouped it down to $1140, then rebooted the budget at $1140, then no bueno. The FMV went up with your labor, not down. But if you bought the wagon for $1140, and traded it for something better, then you are golden.

I don't think this can be answered until the new rules are released. I am waiting on my build for similar reasons.

Let me try to word this differently:

I bought the wagon for $300, put about a $1000 in it, recouped about $200, and it ran in $2016 with a budget of $1,140 all said and done.

Then I traded the wagon for the SC300.

Then I bought the Model A for $1,250.

I think this discussion has brought up two questions:

• Can I recoup the full $1008 or can I only recoup $808?
• Am I even allowed to trade-in a Challenge car (most of which undoubtedly have higher FMV than their Challenge budgets indicate) and use its Challenge budget as the purchase price of the new car?

SVreX wrote: Your labor absolutely has value. The one thing no one has ever pursued is the "paper clip trade"- where you start with something as valueless as a paper clip, and keep trading up until you can trade for a house. It's legal in the rules (but a heck of a lot of work). But to do this, you would have to include the original purchase price of the wagon in your budget. You can't claim the recoup without including the purchase price.

Here is how I read it.

The wagon ended with a budget of $1,140. Included in that was $200 that was recouped into that budget by selling wagon parts. So without adding the recoup into the wagon budget, it would have been $1,340.

The wagon was then traded for the Lexus and he assigned a value of $1,140 to the Lexus.

The question is, as he is selling the Lexus parts to recoup to the budget, how much can he recoup? Is it $1,008 or is it $808. Since it is an entirely new build one theory would say he can start the recoup over which would allow for $1,008. The other theory says $200 was recouped in the original car, so that is $200 less than can be recouped in the new one, hence $808.

That is just how I read the question. Hope I got it right and it makes sense.

I saw the wagon, i have no issue calling it's post challenge value $13xx minus 200 recouped. It was a high mile wagon with bondo and a junkyard engine.

Until rules posted saying otherwise I would use last year's budget as the valuation of the wagon, put the lexus in at 13xx and show why and go from there and recoup your 1008.50, or put it in at 11xx and recoup your 808.50. Either adds up to the same thing in the end.

Thats how i see it, having never traded for a challenge car.

maschinenbau wrote: Let me try to word this differently: I bought the wagon for $300, put about a $1000 in it, recouped about $200, and it ran in $2016 with a budget of $1,140 all said and done. Then I traded the wagon for the SC300. Then I bought the Model A for $1,250. I think this discussion has brought up two questions: - Can I recoup the full $1008 or can I only recoup $808? - Am I even allowed to trade-in a Challenge car (most of which undoubtedly have higher FMV than their Challenge budgets indicate) and use its Challenge budget as the purchase price of the new car?

This would put the value of the SC300 at $1140, with $200 already recouped.

UNLESS, you assign a new FMV to the SC300 at the time of purchase. But that would probably be higher than $1140+ $200.

maschinenbau wrote: Let me try to word this differently: I bought the wagon for $300, put about a $1000 in it, recouped about $200, and it ran in $2016 with a budget of $1,140 all said and done. Then I traded the wagon for the SC300. Then I bought the Model A for $1,250. I think this discussion has brought up two questions: - Can I recoup the full $1008 or can I only recoup $808? - Am I even allowed to trade-in a Challenge car (most of which undoubtedly have higher FMV than their Challenge budgets indicate) and use its Challenge budget as the purchase price of the new car?

The reason the challenge value was at $1140 was because of the $200 in recoup so it needs to count as part of the overall recoup or the value needs to be at $1340.

Same example as before I can't buy a $1000 hooptie, sell off $600 in parts, replace those with $200 in junkyard parts then trade it to get another car and say I'm now at $600 with full recoup left.