Can you ACTUALLY sell 'gold coins' and keep the money?

[AJMD429]

Twenty years ago my wife and I bought some gold coins (not 'vintage', but current-production stuff) just as an investment, and thought it would be cool to have each of our kids get a 1 ounce gold coin with their birth-year on it.

Since the health-insurance companies are only making life profitable for those physicians who kick back huge amounts of money to them by doing shoddy patient-care, we've got to the point where we'd like to 'cash-in' several of those coins (sorry, kids).

BUT I heard you have to pay some capital-gains tax or something, and we don't even know what we paid for them originally (actually a couple were gifts).

If this is true, we'd be selling something and paying a PENALTY for the fact that it has grown in value somewhat. The penalty may exceed the increase in the price of gold.

I'm guessing this is just one more example of "soak the rich" and anyone with a gold coin or two to sell must be rich and evil and therefore to be taxed to death...???

What is the real deal with buying/selling the occasional gold coin...???

 

[rockhopper46038]

That's the way our tax code works (or doesn't, depending on your viewpoint). The short answer is "yes", the IRS would expect you to subtract your basis from your selling price and pay capital gains taxes on the difference. It sucks, but it won't exceed the increase in the price of your gold.

That's the real deal.

However, I would guess that it is a pretty small percentage of folks that sell their gold coins and pay the capital gains taxes due. People buying and selling small amounts of gold here and there are pretty uninterested in documenting for .gov their transactions, I would suspect.

 

[churchmouse]

What happens in the gold shop stay's in the gold shop.

 

[XtremeVel]

If you do decide to sell, might give the site supporter Brad ( Brad's Knives ) a holler....

I have dealt with him a few times with silver and each time I did better with him than I would of at any of the (4) dealers we have here in Ft. Wayne...

 

[BehindBlueI's]

Capital gains taxes range from 0-20%, depending on your other income. Hardly enough to wipe out the gains in gold over the past 20 years. For most people, its 15% (few folks are going to make the $400k/yr for the 20% to kick in.)

 

[AJMD429]

Well I know it is just two or three coins, but the idea of paying a tax on it just bites.

What if you bought a used lawn tractor a few years ago, use it a couple years, then fix it up and sell it at another garage sale - are you supposed to document what you paid for it and 'prove that you took a loss on the sale to avoid paying taxes, or what if God-forbid you sold it for a couple hundred more than you put in it..??? Does THAT require tax as well...??? (It seems not really any different than the 'gold' situation, after all...)

 

[rockhopper46038]

Capital gains taxes range from 0-20%, depending on your other income. Hardly enough to wipe out the gains in gold over the past 20 years. For most people, its 15% (few folks are going to make the $400k/yr for the 20% to kick in.)

Bullion cap gain rules are a little odd, and can unfortunately top out at 28%, but your point still stands that you will always retain at least part of your gains.

It still sucks.

 

[rockhopper46038]

Well I know it is just two or three coins, but the idea of paying a tax on it just bites.

What if you bought a used lawn tractor a few years ago, use it a couple years, then fix it up and sell it at another garage sale - are you supposed to document what you paid for it and 'prove that you took a loss on the sale to avoid paying taxes, or what if God-forbid you sold it for a couple hundred more than you put in it..??? Does THAT require tax as well...??? (It seems not really any different than the 'gold' situation, after all...)

That is colloquially known as "improving your basis"...

 

[sgtonory]

Your property why involve a 3rd party into the translation that provides no service to you?

 

[LeeStreet]

Don't ask, don't tell, but for you, it's to late. Unfortunately for you the IRS probably already read your thread.

 

[NathanJefferson]

Well I know it is just two or three coins, but the idea of paying a tax on it just bites.

What if you bought a used lawn tractor a few years ago, use it a couple years, then fix it up and sell it at another garage sale - are you supposed to document what you paid for it and 'prove that you took a loss on the sale to avoid paying taxes, or what if God-forbid you sold it for a couple hundred more than you put in it..??? Does THAT require tax as well...??? (It seems not really any different than the 'gold' situation, after all...)

Technically you are supposed to pay taxes on ANYTHING you buy and resell at a later date for more money. So yes, a tractor which is now worth more than you paid for it would have a tax implication if you sell it.

Now HYPOTHETiCALLY if you were to barter it, or sell it for cash and there were no paper trail, and no documentation of you having the coins the IRS wouldn't be able to charge you any tax on it; unless you volunteer the information which is your civic duty or you are a tea party organization that is currently being anal probed.

 

[ocsdor]

*retracted*

If you sell to a coin shop and they write down your name, then there is a paper trail.

Disclaimer: I am not an accountant, tax person, IRS agent, financial advisor, nor any other professional financial person.

 

[Bunnykid68]

If you sell your gold today just remember you are selling it for less than you paid for it then, therefor no need to claim any income on it at all.

 

[Mcolson181]

What happens in the gold shop stay's in the gold shop.

This^^

 

[Trigger Time]

What happens in the gold shop stay's in the gold shop.

Amen! As soon as our rich public servants start paying all they owe maybe more regular joes would feel obligate to do their part as well.

But as it stands now, they need to collect all the taxes they can so that moochelle troll-face can go on all her vacations on our dime.

 

[Scutter01]

If it so happens you take a loss on the deal, then you can subtract that loss from your taxes (somehow).

Because capital gains are calculated on your total of all unearned capital for the year, not on a per-transaction basis. If you gained $20,000 on gold sales but lost $22,000 on real estate, then your capital gains are -$2,000.

 

[CBR1000rr]

I had some gold coins once. Silver ones too. Haven't seen them in years. I used to hide them cause I don't trust banks. Between several moves and general life, I couldn't tell ya what happened to them.

 

[cobber]

If you sell your gold today just remember you are selling it for less than you paid for it then, therefor no need to claim any income on it at all.

Ah, but if you sell it for a loss, that can be a good thing too. I think you can take up to $3000 of capital loss against income. Or you could, back when I was learning the tax code...

 

[flightsimmer]

You and others who have gold and silver coins are being scammed by the government and the irs.
Gold, Silver and other so called presious metals do not gain or lose value. It is the value of the currency that changes and it is losing value BIG TIME, yes I know about supply and demand but that's another subject and I'm curious as to why more people are not screaming from the rooftops about it.
All Americans are being robbed from every corner of the world and here at home and we just sit here and take it.
WHY? Because we just don't know what to do about it and were afraid to do anything about it because we might suffer personally. Others simply don't know or care.
By the way, that's extortion. We are being threatened to comply or suffer the consiquences from the greater power even though we now know that, that leadership is corrupt. Whew! Well, I feel better.

 

[TEK]

you guys may not be aware of this but gains on gold and silver coins are usually not taxed at the lt cap gains rate but instead at the "collectibles" rate. 28% if I recall correctly

that said, a lot of people cash and carry and forget to fill out their 1040 properly. which is why congress had changed the 1099 rules on sales of bullion. however a lot of different lobbies got together and got the rules changed back.