Are American Eagle Gold Coins Taxable?
The American Eagle gold coin is one of the world’s most beloved bullion pieces, beloved among collectors and investors alike for its striking combination of design and metal purity.
However, the IRS does have reporting requirements for sales of precious metals to customers that exceed certain thresholds; dealers are required to issue a 1099-B for these sales.
Taxes on Capital Gains
American Eagle gold coins and other precious metals are considered collectibles by the Internal Revenue Service, meaning they may be subject to a maximum capital gains tax rate of 28% when sold. This tax rate differs from regular income taxation because profits only become applicable once realized.
Many investors include American Eagle bullion in their portfolio as a form of diversification beyond stocks and bonds, particularly since certain Individual Retirement Accounts permit such coins as investments.
Investing in precious metals requires keeping track of your cost basis – the price at which you purchased or were gifted the coin or bullion. Profits above this cost basis will only be subject to tax, so keeping receipts or documentation from when your items were acquired is crucial for tax-efficient investing.
Precious metal dealers must report sales of coins and bullion worth more than $10,000 sold for cash to the IRS in order to help track large commodity transactions and detect money laundering activities. This helps track large sales volumes as well as counter money laundering activities.
Capital Gains Tax Rate
Many investors invest in precious metals because of their value, but you may be pleased to know that there are also tax benefits associated with owning this valuable asset. When sold for more than what was paid for them, the IRS taxes the profits at a capital gains rate – this needs to be reported annually and may substantially lower your tax liabilities.
American Eagle gold coins reflect their metal content rather than any collector or numismatic value; their intrinsic worth is determined by market prices that change daily.
Investors who purchase American Eagle gold and silver coins can gain significant savings by placing them into individual retirement accounts (IRA). The IRS permits certain IRA types to include precious metal bullion investments like the popular American Eagle gold bullion coin – providing diversification that stands apart from stock market fluctuations and bond fluctuations.
Reportable Capital Gains
American Eagle coins are popular additions to investment portfolios in IRAs. Approved by the IRS and meeting minimum purity standards set by the US Mint, these bullion coins provide diversification options beyond stocks or bonds.
However, investors should keep in mind that any time they sell precious metals at a profit, the realized value is subject to capital gains taxation. There are ways you can mitigate your tax liability though; such as using the cost basis as selling price for gold investments.
Most dealers must report all sales of precious metals that exceed certain thresholds to the IRS on 1099B forms, which allow the agency to monitor large transactions and detect money laundering. Certain coins and bullion are exempt from these rules, such as legal tender coins and those made of specific fineness metal. American Eagle coins do not fall into this category and therefore do not require reporting requirements as much.
The American Eagle gold coin is an elegant choice for investors and collectors alike, and is available in various sizes (one ounce and half an ounce) made with 22k pure gold and guaranteed by the U.S. Mint for weight and content. Furthermore, these coins are eligible to be added into an IRA portfolio, providing investors with another valuable way of diversifying their retirement portfolio with precious metals.
Since 2006, the United States Mint has offered collectors another numismatic version of the American Eagle gold coin – Burnished collectible uncirculated gold coins with softer surfaces and bearing a “W” mint mark for easy differentiation from their bullion counterparts. This version was available from 2006 until 2008 before being discontinued for two years before returning with renewed availability in 2011.
As such, proof and burnished American Eagle gold coins typically command higher premiums than regular bullion coins; however, their unique numismatic qualities make them an invaluable addition to your gold investment collection.