I wanted to address the issue of bullion reporting requirements when selling precious metals to a dealer in the United States for U.S. citizens. I am amazed in many instances as I travel that even people who own bullion don’t understand the facts as they relate to government reporting when buying or selling gold, silver, platinum, or palladium.
First, when you are buying precious metals there is absolutely no reporting unless you are trying to buy your precious metals with cash in excess of $10,000. Cash includes paper money or cashier checks which are both considered as cash. Some dealers, just to be safe with the IRS, will report any cash transactions no matter if it’s under the $10,000 benchmark or not.
If you are using cash to purchase precious metals, (and I would advise against it), a dealer must fill out IRS Form 8063 which includes your social security number, driver license, address, and amount of the cash transaction.
And please don’t try to do 3 separate cash transactions each under $10,000 as a way to avoid cash reporting of a $30,000 cash transaction. This only flags you to be investigated. Precious metals dealers and banks are on the alert for individuals who try to do such transactions.
All you have to do is pay with a personal check or a bank wire for any amount of precious metals you desire to buy ($500 or $10,000,000). There is no reporting required to the IRS by either the individual buying or the dealer that is selling to you if you pay by personal check or bank wire.
When selling precious metals to any dealer in the United States the following list is what dealers in the United States are required to report.
|Reportable Item||Minimum Fineness||Minimum Reportable Amount|
|Gold Bars||.995||Any size bars totaling 1 kilo (32.15 troy oz.) or more.|
|Silver Bars||.999||Any size bars totaling 1000 troy oz. or more.|
|Platinum Bars||.9995||Any size bars totaling 25 troy oz. or more.|
|Palladium Bars||.9995||Any size bars totaling 100 troy oz. or more.|
|Gold 1 oz. Maple Leaf||as minted||25 1 oz. coins|
|Gold 1 oz. Krugerrand||as minted||25 1 oz. coins|
|Gold 1 oz Mexican Onza||as minted||25 1 oz. coins|
|U.S. 90% Silver Coins||as minted||Any combination of dimes, quarters, or half dollars totaling $1,000 face value or more.|
(For Canadian clients please contact AmeriGold about the reporting requirements in Canada).
So what this list means is that if you are selling gold or silver eagles in any quantity to a dealer they do not require a 1099B. If any precious metals item does not appear on this list then it does not require a 1099.
Also, if a person sells less than the minimum reportable amount (for example 20 Gold Krugerrands), that transaction is not reportable as well. Only if you sell 25 1 oz. Krugerrands or more does it require a 1099B.
If you do not see an item on this list, then it is not reportable. For example do you see Austrian Philharmonics on this list? The answer is no, so they are not reportable in any quantity when you sell them.
This is important to understand so some rip off numismatic dealer does not con you into buying their high commission graded coins over low commission bullion coins by saying that bullion is reportable. This is a common tactic by numismatic coin dealers to convince you that numismatic coins are better than bullion, but just the opposite is true once you understand the truth about bullion reporting requirements. Many bullion items are non-reportable in any quantity while some bullion items are reportable based on certain numbers contained on the above list.
An example I want to share with potential investors that will help you avoid a catastrophic mistake is getting talked into buying numismatic products when what is in your best interest is buying bullion coins or bars.
One of our good clients was approached by her friend who had been ripped off by one of the largest gold dealers in the country. This woman was looking to buy $90,000 worth of gold and felt that the gold American eagles were what she wanted to buy.
Unfortunately for her however, after talking with the sales rep at this firm, she was bamboozeled into buying high priced, high commission numismatic products.
Fast forward six years later when gold prices rose by three times what they were when she made this purchase and she found herself in a tough financial position and needed to cash out those numismatic items.
When she called the dealer to find out how much she would get for selling these numismatic coins back to the dealer she was told $57,000. She was outraged and thought she had been scammed given that gold prices had moved up 300% percent from when she purchased.
She was venting to her friend, (our client) about the situation and didn’t know what to do. Our client suggested she call us at AmeriGold and said we could probably help her better understand what had happened.
We explained to her had she bought the gold eagles like she originally intended, she would have received $270,000 for her gold eagles when she would have needed to sell them. I told her the day she sent the money to this firm, the commission they took probably exceeded 50% of the $90,000. The commission that AmeriGold would have charged her to buy $90,000 worth of gold eagles would have only been 1% ($900) of the dollar volume on the order.
You can imagine how this poor woman felt when she realized her mistake.
Over the six year period while gold prices tripled, the value of her numismatic coins only moved up slightly. I explained to her that the numismatic market and the bullion market are two totally separate markets.
The bullion market does move up or down with the gold market, but since numismatic coins do not move up or down much with the price of gold, it is based on other factors. In addition, numismatic coins are not anywhere near as liquid as bullion coins when you sell.
This unfortunately happens to many investors who are tricked into buying items that are not in their best interest. At AmeriGold we take pride in helping our clients understand all the issues related to buying precious metals so they can make an informed intelligent decision that is in their best interest.
Don’t let this happen to you. Be informed when you are purchasing precious metals.
You should only buy numismatic graded coins if you are a collector or this is a hobby of yours. Don’t fall for the marketing hype these vermin spew out to confuse you and talk you into buying their high commission garbage when bullion is what you want.
AmeriGold.com is a bullion dealer that prides itself in being a safe and reliable place for our clients to buy and sell the precious metals without any sales pressure or con job.
Call them if you are interested in owning bullion and understanding all the issues before you purchase. This will enable you to purchase the items that will make the most sense for you.
Please feel free to send this communication out to anyone you know as I would love to be the source of saving someone the grief, aggravation, and frustration of feeling ripped off and financially abused like this poor gal from Long Island.
Anyone who knows me knows how bullish I have been for over 16 years in owning the physical precious metals and taking delivery. The time is soon approaching however when physical precious metals become the ultimate form of money as the unsustainable debt position of the United States finally implodes.
The old adage of “When money dies, your money doesn’t have to die with it” certainly comes to mind. History proves that fiat currencies always fail as will the euro and the dollar. If you keep your money in U.S. banks in fiat currency dollars you will lose the biggest part of the purchasing power of that money as sure as death and taxes. I just can’t tell you the exact timing, but we are getting ever so closer to “FLASH EVENTS” that are going to shock the world.
The bottom line to investors is you don’t have to lose your money as money dies.
Ownership of physical gold and silver will protect your hard work and savings. Don’t wait much longer if you have not already acquired your position.