How Much Gold Or Silver Can I Sell Without Reporting to the IRS?
As a rule, gold bullion bars and coins don’t need to be reported to the IRS; however, silver that has increased in value should be reported when sold.
Dealers are required to file Federal Form 1099B when reaching certain quantities on sales to customers in order to comply with federal efforts to combat money laundering and tax evasion. This reporting requirement serves as part of their responsibility as members of society to help combat money laundering and tax evasion.
Precious metal coins are popularly held privately by investors for various reasons ranging from pure investment to sentiment and the fact they do not incur capital gains taxes like stocks do. But some customers remain concerned about being reported to the IRS should they sell any precious metal purchases.
Though most bullion purchases do not require reporting to the IRS using Form 8300, dealers may occasionally need to do so in order to comply with federal law and monitor large commodity exchanges throughout the nation and prevent potential money laundering schemes. This law was put in place so the federal government can keep an eye on large commodity transactions within its borders and prevent any potential money laundering schemes that might take place.
Pre-1965 US coins and private mint silver products (ranging from half an ounce to one twentieth of an ounce in some instances) must be reported, while dealers are able to conduct more discreet transactions when purchasing other precious metal products such as bullion sales or 1-oz Silver Maple Leafs or Krugerrands. Bullion sales do not require 1099-B filing; any sale involving these numismatic coins is also exempted from filing requirements, along with sales including 1-ounce Maple Leaves or Krugerrands or sales including 1-oz Maple Leaves or Krugerrands are exempt.
Gold and silver bars are considered collectibles by the IRS, so when sold they must be reported. When sold they will incur capital gains tax like any investment; thus market participants in higher tax brackets will pay additional in taxes due to this purchase.
Coin reporting guidelines tend to be more lax. The International Council for Tangible Assets publishes guidelines, in consultation with the IRS, that specify which coins must be reported when sold by dealers – these currently include 1 oz gold Maple Leaf Coins, Kruggerand Coins and any 90% silver US coins.
Due to these rules, dealers are required to report sales of bullion pieces sold with cash or a cashier’s check payment of more than $10,000 when customers use these methods of payment for purchase. This reporting helps the government combat money laundering activities and other forms of criminal activity; as a result, we recommend working closely with a financial professional if investing heavily in bullion.
Precious metals such as gold and silver are considered capital assets by the IRS in the US, meaning any profits earned when selling physical precious metal investments are subject to capital gains tax when sold.
To prevent paying taxes on their profits from selling their precious metals, investors can reinvest proceeds from the sale into investments with similar investment properties – this way any capital gains taxes due on the original sale can be offset with similar capital gains taxes on any new investments purchased.
Example: If an investor sells Gold Maple Leaf Coins to an authorized dealer and makes a profit of $1,000 or more, they must file Form 1099-B with the IRS. On the other hand, investors who sold privately-minted Silver Eagles or similar bullion products for profit to a reputable precious metals dealer won’t need to submit this form at all.
Bullion metals can provide protection from inflation and financial turmoil, yet many investors remain unclear how the IRS treats precious metals sales. There is no “trick” or “loophole” available to avoid paying taxes on bullion purchases.
Dealers are required to issue 1099-B forms to customers they sell products listed on the IRS Reportable Items List in specific quantities based on purity and quantity criteria set by the International Council for Tangible Assets after consultations with the IRS.
Rare coin dealers may tout their products as safer from government confiscation, but Money Metals Exchange prides itself on keeping customer transactions confidential and discreet. While investors may see some advantages to buying collectible coins, low-premium bullion bars and rounds provide greater savings protection from government interference; their lower transaction costs and premiums far outweigh risks associated with speculation in collectible coins.