Please note the following information is for educational purposes only and should never be considered financial advice. Exclusion from reporting requirements do not exempt customers from capital gains taxes or other relevant taxes associated with the purchase or sale of physical precious metal bullion products. Consult a professional tax advisor for any tax advice you need.
Although US Congressional efforts are underway to potentially repeal capital gains taxes on Constitutional gold and silver monies (H.R. 6790), we want all bullion buyers and sellers to understand current bullion buying privacy statutes, bullion dealer reporting thresholds when repurchasing bullion from customers. And finally, some potential current bullion tax gain/loss parameters to consider.
In the following content, we again cover IRS bullion reporting requirements when buying bullion in the USA.
We also discuss current IRS reporting requirements if selling bullion to US-based precious metal dealers as well.
Finally, we will end this post by discussing current general Gold Silver Tax ramifications for when you sell bullion at either a profit and or a loss. Of course, we are not tax professionals, so be sure to consult one with your specific needs or questions.
Gold Reporting on Cash & Cash Equivalent Payments
For bullion buying and selling privacy statutes, there are specific IRS reporting requirement rules which bullion dealers in the USA must comply. Reporting rules when buying bullion trace their roots to Anti-Money Laundering laws.
Here at SD Bullion, we have purposely set up our bullion payment policies so that the high 99% percentile of customer bullion purchases remain private, without additional paperwork or any IRS reporting required.
For bullion selling to dealers, some products sold in specific volumes get reported in high amounts, and this legal requirement traces its roots to 1980s CFTC rules regarding the futures contract sizes and stipulations. We cover those stated products and sell back volumes below.
Selling Silver Gold Tax Implications
Often misquoted or misunderstood in the precious metal industry, maximum long term capital gains taxes on bullion and or supposedly physically backed ETFs are at a 28% rate.
But the specific rate at which you would get taxed on profitable bullion sales will depend on your particular tax bracket as well as other factors involved.
How to Sell Gold Without Paying Taxes?
Other than front-loading your tax payments to begin a bullion investment by using a Roth IRA. Current rules are if you sell your bullion at fiat currency prices higher than your fiat currency cost basis, then the IRS is going to demand a portion of those fiat currency capital gains in the form of capital gains taxes.
Of course, you could avoid paying taxes if you sell bullion at a lower price than your original purchase price (resulting in a capital loss). By doing this, you could be then allowed to deduct up to USD 3,000.00 losses against other taxable income.
As well, if the loss you have on a bullion sale is more significant than $3k US dollars, you can likely continue to deduct those additional losses in a subsequent year(s) to come via tax loss carryforward provisions.
Of course for specific tax guidance on bullion sales profits and or losses, you should consult professional tax counsel as we are not tax professionals ourselves here at SD Bullion.
Payment Reporting when Buying Bullion Online?
If you have bought bullion online, it is likely you have noticed various payment policies which deter customers from using large amounts of cash or cash equivalents in payment (e.g. typically discouraging $10,000 USD or more payments in cash or cash equivalents like cashier’s checks, money orders, traveler’s checks, and bank drafts). The IRS requires businesses to file Form 8300 when large cash payments are involved.
There have been various now bankrupt, poor track record bullion dealers in the past who have got themselves into hot water by allegedly laundering drug dealer cash through bullion purchases. Even some established bullion mints have been accused in the past as well as also as recently as this year (2018), for not having appropriate anti-money laundering policies in place.
Often law-abiding bullion dealers in the USA resort to only receiving cash equivalent payments in small quantities, if any at all. Typically online bullion dealers lean on established financial institutions as the first layer in their Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance policies.
Typical online bullion dealer payment methods like personal bank checks, bank wire transfers, ACH, credit / debit cards, PayPal, etc. are exempt from IRS Form 8300 filings by bullion dealers as these payment methods are coming through financial institutions which should have already executed legally required KYC and AML due diligence on their respective customers.
Sales Reporting when Selling Bullion Online?
When individuals sell their bullion to a domestic US-based precious metal dealer, there are quantity and bullion product sales to dealer thresholds for their required IRS 1099-B form filings.
The following private bullion products, when sold by individual investors in precise quantities to US-based bullion dealers, are required to be reported to the IRS.
|
REPORTABLE BULLION ITEM when Selling to US-based bullion dealers: |
MINIMUM FINENESS |
IRS 1099-B REPORTABLE AMOUNTS not structured |
|
Gold bars/rounds |
0.995 |
32.15 troy oz or more |
|
Silver bars/rounds |
0.999 |
1,000 troy oz or more |
|
Platinum bars / rounds |
0.995 |
25 troy oz or more |
|
Palladium bars / rounds |
0.9995 |
100 troy oz more |
|
Gold Maple Leaf Coins 1 oz |
As minted |
25 troy oz or more |
|
Gold Krugerrand Coins 1 oz |
As minted |
25 troy oz or more |
|
Gold Mexican Onza Coins 1 oz |
As minted |
25 troy oz or more |
|
US 90% Silver Coin Bags |
As minted |
$1,000 face value bag |
Under current statutes, the following bullion and precious metal products can get sold to US-based precious metal dealers in any quantity, and under existing laws, no IRS 1099-B forms are required to be filed by US-based bullion dealers.
Silver Selling Privacy Remains on these Silver Bullion Products
The following popular silver bullion coins are fully private when sold to US-based bullion dealers currently:
- American Silver Eagle Coins & ATB Silver Coins (any sizes and volumes)
- Armenian Noah’s Ark Silver Coins (any sizes and volumes)
- Austrian Silver Philharmonic Coins (any sizes and volumes)
- British Royal Mint Silver Coins (any sizes and volumes)
- Canadian Silver Maple Leaf Coins (any sizes and volumes)
- Chinese Silver Panda Coins (any sizes and volumes)
- Mexican Silver Libertad Coins (any sizes and volumes)
- New Zealand Mint Silver Coins (any sizes and volumes)
- Perth Mint Australian Silver Coins (any sizes and volumes)
Gold Selling Privacy Remains on these Gold Bullion Products
The following popular gold bullion coins are fully private when sold to US-based bullion dealers currently:
- American Gold Eagle Coins (any sizes and volumes)
- American Gold Buffalo Coins (any sizes and volumes)
- Austrian Gold Philharmonic Coins (any sizes and volumes)
- British Royal Mint Gold Coins (any sizes and volumes)
- Chinese Gold Panda Coins (any sizes and volumes)
- Perth Mint Australian Gold Coins (any sizes and volumes)
Platinum Selling Privacy
Based on current statutes, you can sell any, and all government minted .999 platinum bullion coins to US-based bullion dealers, and those government-issued platinum coins are exempt from IRS 1099-B bullion dealer reporting requirements.
Palladium Selling Privacy
Based on current law, you can sell any, and all government minted .999 palladium bullion coins to US-based bullion dealers, and those government-issued palladium coins are exempt from IRS 1099-B bullion dealer reporting requirements.
Taxes on Silver Gold Bullion?
Regardless of whether or not a purchase or sale is private or IRS 1099-B reported, currently no bullion product sales are exempt from any applicable capital gains taxes (state or federal laws).
The only exception right now would be selling approved IRA approved bullion products within your IRA, for that other rules will apply and vary depending on if your bullion IRA is a Roth or Traditional, etc.
Always consult your tax professional on all bullion sales losses or capital gains you may have had: past, present, or future.
Potentially Repealing Silver Gold Tax Laws?
If you believe capital gains taxes on gold and silver monies are not in line with the United States Constitutional Law.
You could directly encourage your US Congressman to sign on to this developing HR 6790 bill which could potentially repeal such future taxes if passed.
Thank you for visiting us here at SD Bullion.
