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 Replies: 52 / Views: 10,914 |
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Pillar of the Community
United States
919 Posts |
But when you sell on ebay you pay the premium to them (up to 10%) and pay capital gains tax on the short term flip. That eats up all of the profit. Unless people just don't report any of this to the IRS, I don't see how there is a profit to be made. If selling on ebay I have to believe there is a record of that kept. |
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Valued Member
United States
455 Posts |
Quote:But when you sell on ebay you pay the premium to them (up to 10%) and pay capital gains tax on the short term flip. Can you explain this a little more please? When I talked to a gold distributor, I believe he had mentioned that the 1 oz coins had to be reported but nothing lower. I'd love to get a better understanding of the laws/requirements here. Thanks. Dave |
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Pillar of the Community
United States
919 Posts |
Do an internet search on capital gains taxes on gold. You will find that any gain must be reported as gain on collectibles and must be reported to the IRS. The sites I read said nothing about weight of coin.
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Pillar of the Community
United States
4008 Posts |
Quote:
You will find that any gain must be reported as gain on collectibles and must be reported to the IRS. True but many people do not report it and if there is no 1099 filed for the sale, it never happened as far as the IRS is concerned. Same with gambling winnings. Win a few hundred and no one but you and the casino ever know about it. Win a few thou, on the other hand, and a 1099 will be filed and then the IRS knows all about it. Yes, they WILL demand payment of the tax due and perhaps withholding as well, if the amount is large enough. I once saw a young gal from Oakland, CA win a $250k slot jackpot in Reno and an IRS agent was there to "help" her before the bells stopped ringing. Seriously. |
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Valued Member
United States
148 Posts |
If you sell anything sizable worth of PM's (say over $5,000) even if you don't think a 1099 was generated it would be smarter to report it and be creative with the cost basis (most people have no idea what they paid) than not report anything and hope it slides by, IMO.
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Bedrock of the Community
United States
10982 Posts |
There is no 1099 generated on transactions under $10,000. These tiny tranactions (by gov't standards) are "invisible" and deemed not worth the effort to track (at this time). Now if you regularly execute $10k, or near $10k, tranactions and continually come out making a profit? That could raise some eyebrows in the long run but even that is unlikely.
There are so many loopholes in our current tax system that you could drive an aircraft carrier through it unnoticed.
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Pillar of the Community
United States
3789 Posts |
interesting discussion here.
My experience has been- (in regards to proof silver and gold)
1. the bigger the oz coin, the higher the premium
2. smaller size, lower premium but moves faster when liquidating. this I have observed and had related accounts.
Now there are exceptions to this, such as mintage numbers. Lower mintage number help these fractional coins.
all in all, with gold I don't think you can go wrong in having a mix of fractional sized coins.
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Pillar of the Community
United States
3789 Posts |
as far as taxes-
there is a rule, if you google you can pull it up that dealers when they sell X amount of ounces of foreign gov silver and gold must be reported when sold by the IRS. Other coins sold are not reported.
When in reverse you sell to your dealer, I forget now but I believe a 1099 is filled out. I forget now if its a certain amount that triggers that form. I might have my facts mixed up. this was put in effect in 2012 I believe.
later on ill try and dig up the rules. and yes, the IRS takes a slice on the sales as was mentioned above, gold and silver fall under collectibles and must be reported.
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Valued Member
United States
410 Posts |
ebay started reporting sales to the IRS in 2011. You will get a 1099 if you have more than $20,000 in total sales or sell 200 items in a year.
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Pillar of the Community
United States
4008 Posts |
Quote:
There are so many loopholes in our current tax system that you could drive an aircraft carrier through it unnoticed. Yes, there are. There are also quite a few "gotchas" in the tax code, hence the need for a separate "tax court". Hopefully, Congress will get busy on this and clean up the US tax code. It really is quite a mess. If Congress-critters HAD to fill out their own tax forms, you can bet that the tax laws would be MUCH simpler. |
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New Member
United States
37 Posts |
Similar thoughts are going through my head now. Went to the LCS with intentions of getting 4 1/4 oz coins. The guy at the shop literally talked me out of the sale! He said that was one of the most expensive ways to end up with an oz of gold. He recommended the following options:
1. Just buy a 1 oz coin
2. Buy gram bars to get you close to an oz (3 10g or a 10 and a 20)
3. Buy 4 British sovereigns (.2354 oz each) since they have a much lower premium
So long story short I left empty handed. Definitely not considering option 1 since I wanted smaller denominations, but maybe the gram bars or the sovereigns might not be bad options...
Any comments are welcome.
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Valued Member
United States
200 Posts |
British sovereigns do sell for very close to spot but I have not seen 10 g bars selling at the same price level. The ones I have seen carry a small premium, little larger than the oz bars.
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Valued Member
United States
151 Posts |
@veritek - It's hard to advise someone when you know next to nothing about their intentions, their goals, their means, etc. but I will give you my feedback for what it's worth. What did the LCS have on hand? Not buying what's available to you at the time isn't necessarily going to save you any money if the spot price goes up between the time you left the LCS and the time you buy/order sovereigns, and a wasted trip costs time/money that should be factored in also. Sovereigns have been a target of counterfeiters for many years, so I'll only buy proof or graded ones, which do have a higher premium along the lines of a 1/4 maple or eagle. The smaller the gold, the higher the premium, but it's easy to recover the premium upon resale of 1/10th oz coins as others have mentioned here. You could also consider 10 pesos (.2411 oz) gold coins. Is there a reason you didn't just buy a 1oz coin?
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Pillar of the Community
Canada
1502 Posts |
you have a good LCS. A lesser one would've sold you the coins first.
If you are worried about having to liquidate fast, go with as low a premium as possible. If not, it really doesn't matter. I personally think the copper brown shade of sovereigns is off-putting but that's the point, it's personal preference. If you are careful about your choice of venue and buyer when you are selling, any premiums you paid can be recovered.
(If you are able to get the gram bars close to spot they are a steal)
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Valued Member
United States
292 Posts |
I'm curious why more members don't offer gold on this site before putting on ebay? |
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Replies: 52 / Views: 10,914 |
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Posted 01/16/2013 12:05 pm
