An Unexpected Find – $7.5 Million In A Storage Unit

Storage units are sometimes auctioned off when their owners fail to pay the amount they owe to the company that owns the unit. Usually, these units have some odds and ends in them that could earn the buyers a small profit. In this case, there was a safe inside with $7.5 million! Let’s explore how this happened and what followed.

“Storage Wars” and Dan Dotson

The owner of American Auctioneers, Dan Dotson, appeared on the hit TV show Storage Wars several times. His storage units were featured on the show multiple times, leading to many people trying their hand at buying unpaid units.

The show saw its protagonists buying these units, opening them up, and finding rare and valuable things left in storage and supposedly forgotten. Dan is known for his fairness in dealing with auctions, and the buyers of this particular storage unit forked out $500 to get the first crack at its contents.

TV Storage Shows Have Huge Audiences

There’s been a general idea that many storage shows stage their productions. It’s fair to think so since a lot of reality TV has elements of staged actors and situations. Yet, despite this, storage shows still get a lot of attention from regular people. Why is that so?

Part of the reason, Dan says, is because people live vicariously through the protagonists. Everyone wants to imagine finding something valuable in a place they didn’t expect. That draw keeps audiences riveted to these shows and helps celebs like Dan become more prominent.

Another Typical Storage Unit?

For viewers of the show, it may seem as though most storage units the team buys have some valuable goods inside. This is partially because the team can spot a few valuable things just from a glance before bidding on the unit.

In this case, the buyers thought they might be able to turn a small profit on their investment. Inside the unit were several odds and ends that might fetch prices from collectors. There was also an old safe, but according to Dan, most of those safes were typically empty, even though they were locked.

How Often Do Locked Safes Show Up?

In general, locked safes don’t show up all that often in storage units. Typically, a locked safe remains with the owner, and many of them are built into houses. Stand-alone safes are sometimes found but may be left open, sometimes with a few documents inside.

When a safe is locked, it takes a bit of effort to get it open. Locksmiths have varying degrees of success when trying to crack safes, and it’s better to just leave them locked and pass them on to the next person who buys the unit. Hopefully, they will have a way to crack the safe.

Popping Open A Safe

Because the renters of the unit were long gone, it wasn’t likely that anyone would be able to figure out the safe’s combination. The new unit owners decided to hire a locksmith to pop the safe open, but the first try to open it was a failure. They didn’t give up hope, however.

The second attempt to unlock the safe was far more successful, with the new locksmith getting the rusty old door open in short order. While the owners expected to find an empty safe, they were pleasantly surprised by running into a haul worth $7.5 million.

An Offer You Can’t Refuse

When word got back to Dan that the safe was opened, he wasn’t too concerned until they mentioned what they found inside. Immediately, Dan and his wife Laura consulted on what they should do. They pitched an offer to the new owners, hoping they would accept it.

Dan suggested that the new owners take a finders’ fee of $600,000 for locating the safe and the funds inside. When the new owners refused, Dan doubled the offer to $1.2 million. The new owners readily agreed and gave up their $7.5 million haul for a smaller portion of the proceeds.

Why Would They Give Up Their Find?

While legally, they could take control of the funds as their own, the hassle it would take for the new owners was a bit too much for them to handle. There would be a lot of running around involved, and Dan offered to handle the running about and pay off the new owners for their luck.

Dan’s status among the storage unit community is part of the draw. Imagine telling your friends you found a multi-million-dollar stash in an old safe you bought from Dan. It would cement both your personal status as a storage unit flipper and raise his profile, too.

Where’d The Money Come From?

Dan admits that he can’t remember who rented the storage unit. Even with his records and the names presented, he suspects it might have been a pseudonym. Before they sold the unit, they called the registered owner to verify that they knew they weren’t meeting the obligations of the unit but got no answer.

Dan’s wife, Laura, is convinced that less-than-upstanding individuals rented the unit. It’s clear that no one who stashed $7.5 million in a storage unit was likely to forget about it. Yet, it raises other questions and potentially aided in the new owners’ decision to let Dan handle the heat.

Is It Likely To Be Legitimate Funds?

Many people would never consider keeping a pile of money inside their storage unit unless they had a good reason for it. No one’s sure when the money went in there, but it’s a good bet that the people who put it there simply didn’t want the attention that would come with a large bank deposit.

Why would someone need a large stash of cash in a safe? It’s possible the money might have been an “insurance” stash to use if a person found themselves in a situation they wanted to avoid. However, all signs point to this safe being the proceeds of something a bit more nefarious.

How Much Money Will Taxes Take?

Found money and treasure both fall under the same bracket when it comes to calculating taxes. The IRS states that it’s entitled to any income from any source, which means finding $7.5 million in a locked safe. So, how does the IRS tax found money?

Found money falls under the broad category of income, along with whatever income a business makes. If you make $50,000 a year and find $10,000 in a duffel bag, your annual income is $60,000, and the IRS will tax you based on your bracket. This means Dan will get a lot less than the $7.5 million.

The Renters May Want Their Money Back

While Dan and Laura can claim the money by virtue of ownership of the storage unit, no one knows why the money was stashed in there in the first place. The new owners of the unit who took Dan’s offer probably figured that the money was ill-gotten gains.

However, Dan and Laura aren’t worried about someone attempting to get back the money. Since the unit remained unchecked and unbothered for such a length of time, it’s unlikely that the person who stashed the money in there was in a position to get it back out.

What Could Have Happened to the Renters?

Dan’s been in this business for several decades, and he’s auctioned off more storage units than most people have ever seen in their lifetimes. According to him, there are several reasons why people might leave their storage unit unattended and miss the payments on it over time.

However, someone with $7.5 million wouldn’t be strapped for cash to miss those payments. More likely, they may have fled the country or gone to prison for their deeds. Whatever happened, Dan’s betting they are in no position to reclaim their lost funds.

Is This Typical For Storage Units?

Many viewers of Storage Wars and other series that romanticize the flipping of storage units know that a few of them contain a lot of valuable stuff. Yet the amount of units that make a return on investment is relatively few, especially if the buyers aren’t good at prospecting.

Finding a haul like this is an outlier, even among regular flipping enthusiasts. Since the buyers paid $500 for their purchase and earned $1.2 million from their find, the return on investment was a whopping 2,400 times what they paid. This is far from typical for most storage unit finds.

What Are the Most Valuable Objects in Storage Units?

Aside from money, which retains its value through the years, there have been a lot of other exciting things found in storage units over the years. Pieces of art worth millions of dollars have turned up stashed in the corner of units. Even undiscovered pieces by masters have surfaced.

Collectibles tend to be where most of the value in a storage unit hides. Some collectibles, such as cards and memorabilia, could command hefty market prices. Sifting through these finds usually takes patience and someone who’s willing to appraise their value for you.

Should You Flip A Storage Unit?

After reading this, you might be tempted to buy a unit and see what you find. The truth is that while you have a chance at making a significant return on your investment, the chance isn’t a very good one.

Most of the flipping requires the buyer to check on the value of the stuff they got, compare it to the market value, and then find a buyer. With all the running around involved, it might be better to keep your money in the bank or invest it elsewhere.