For those who purchase gold in the United States, there are a few federal laws to be aware of—specifically, regulations governing which gold purchases are required to be reported to the government. Keep reading for information on when you must report a gold purchase, brought to you by the experienced professionals from First National Bullion and Coin. San Diego collectors trust our extensive knowledge about every aspect of buying and selling precious metals.
Laws Concerning Gold Purchases
Many people who buy precious metals are looking to avoid the current financial turmoil, which is to be commended. At the same time, some of the old laws concerning the ownership of gold bullion appear to still be in place. However, this doesn’t mean a person cannot buy gold. The fear that individuals would hoard gold (and crash the American economy, which at the time operated on the gold standard) was the idea behind the law of 1933, which outlawed private ownership of gold. That law was repealed in 1974, and it’s only relevant today with regard to certain instances of purchasing gold.
Criteria a Gold Purchase Must Meet
The amount of gold being purchased, the way it’s purchased, the time frame it’s purchased within, and other legal points will determine reporting requirements for gold purchases. Please note this isn’t related to capital gains taxes, which are a different subject. The reporting laws for gold purchases are similar to the “Know Your Customer” law, popularly known as “KYC,” that banks are required to use to prevent money laundering.
When a Gold Purchase May Not Need to Be Reported
If a person walks into a local gold coin shop and buys $12,000 worth of gold using a cashier’s check, this gold purchase wouldn’t be required to be reported. A cashier’s check over $10,000 isn’t considered cash, and paying with one is seen as different from paying with paper currency. As we can see, the legal definition of the word “cash” is important here.
When a Gold Purchase Must Be Reported
In a different example, someone walks into a local gold coin shop and uses cash (paper currency) to pay for gold coins. The buyer pays $8,000 for the first purchase. Within three or four hours, the buyer returns to the same shop and pays $3,000 for more gold coins. This is a reportable event. The purchaser has met a reporting requirement, and a report (Form 8300) must be filed with the IRS.
Information the IRS Will Require
When a gold purchase is required to be reported, the dealer will be the one to report it. Form 8300 requires information about the gold buyer, including name, social security number, address, and license number. If some of the form is left blank, the dealer is still required to send the form to the IRS.
For more information on reporting requirements or any other aspect of buying or selling precious metals, call on the experts at First National Bullion and Coin. Whether they’re looking to buy platinum coins, gold bullion, or silver bars, San Diego residents can trust our reputable dealers. We’re a boutique precious metals firm with experienced professionals, and we work hard to keep our investors informed with the most up-to-date market intelligence. If you’re looking to add precious metals to your investment portfolio, call us today at 858-666-6570.
The statements made in this blog are opinions, and past performance is not indicative of future returns. Precious metals, like all investments, carry risk. Precious metals and coins may appreciate, depreciate, or stay the same in cash value depending on a variety of factors. First National Bullion does not guarantee, and its website and employees make no representation, that any metals for sale will appreciate sufficiently to earn the customers a profit. The decision to buy, sell, or borrow precious metals and which precious metals to purchase, borrow, or sell are made at the customer’s sole discretion.
FAQs
You can purchase gold in any amount using cash. However, if your purchase exceeds $10,000 in value using cash or its equivalents, you must complete Form 8300. This form asks for essential details like your name, address, and social security number.
How does the IRS know you bought gold? ›
Purchasing precious metals is typically done with cash, money orders, or cashier's checks. The dealer must use IRS form 8300 to disclose the transaction if it exceeds $10,000.
Does gold have to be reported? ›
Reporting Requirements
Instead, sales of physical gold or silver need to be reported on Schedule D of Form 1040 on your tax return. 3 Depending on the type of metal you are selling, Form 1099-B must be submitted to the IRS at the time of the sale, as such sales are considered income.
Does the government know when you buy gold? ›
However, no government regulations require the reporting of the purchases of any precious metals, per se. If payment is made by cash greater than $10,000, however, it becomes a “cash reporting transaction.” It is not the gold that the government wants reported but the cash.
Does sale of gold trigger IRS reporting? ›
The IRS considers any profits a customer gains through the sale of their precious metal assets as taxable and is subject to "capital gains" taxes.
How much gold can a US citizen legally own? ›
Today, there are no specific limits on how much gold a person can own in the U.S. Whether it's bullion, coins, or jewelry, you can buy, own, and possess as much gold as you like. The only restrictions may come from reporting requirements if you simultaneously buy or sell large amounts of gold.
Do you have to pay taxes on buying gold? ›
TAXES IN CALIFORNIA
The state tax is 7.5% (which can be altered by local authorities) on bullion coins and bullion bars, and also on rare coins. Basically anything that falls under the umbrella of a precious metal is subject to this altered regional tax.
How much gold can you buy for $10,000? ›
Gold Coins: Assuming an average premium of 5% to 10% over the spot price, you can purchase around 4.5 to 4.7 troy ounces of gold coins with your $10,000. Gold Bars: With lower premiums, possibly around 2% to 5%, your $10,000 could buy you closer to 4.8 to 4.9 troy ounces of gold in bar form.
Does APMEX report to IRS? ›
APMEX is required to report certain transactions to the IRS if they meet specific criteria as per the law. For example, cash transactions over $10,000 or precious metals transactions involving particular amounts and types of metals may be reported.
Do I need to declare my gold? ›
However, it is important to note that you must still declare the items to Customs and Border Protection (CBP) Officers. If you are travelling with more than $10,000 worth of gold coins (or silver coins), you will need to fill in a FinCEN 105 declaration form. Transparency is of the utmost importance here.
For instance, if you fail to declare your gold coins, customs officers may get the impression that you are attempting to conceal the coins. They may think you are attempting to avoid paying customs fees, or you are not the legal owner of the coins.
Is buying gold traceable? ›
When a gold purchase is required to be reported, the dealer will be the one to report it. Form 8300 requires information about the gold buyer, including name, social security number, address, and license number. If some of the form is left blank, the dealer is still required to send the form to the IRS.
Does IRS track gold purchases? ›
Sales of physical gold or silver must be reported on Schedule D of Form 1040. Certain types of metals may require the submission of Form 1099-B to the IRS at the time of sale. Examples include specific U.S. silver coins and certain gold bars. However, sales of American Gold Eagle coins don't need a Form 1099-B.
Why is it illegal to own gold bars? ›
When the stock market crashed in 1929, the well-to-do rushed to convert their bank funds to more reliable gold bullion. This left the government without enough gold to back newly printed money. Therefore, President Franklin Roosevelt used his executive powers to make it illegal to own gold coins or bars.
What is the downside of buying gold? ›
Disadvantages. Gold tends to go in the opposite direction as interest rates. If interest rates go up, gold usually goes down. The U.S. Federal Reserve remains committed to keep interest rates elevated for a longer period of time.
Does the IRS track gold sales? ›
Reportable coins include the 1 oz Gold Maple Leaf, 1 oz Gold Krugerrand Coins, 1 oz Gold Mexican Onza, and US coins composed of 90% silver. If you're selling any of these specific gold coins, the IRS requires a report if the sale involves a minimum of 25 pieces.
Can you buy gold anonymously? ›
The only way to buy gold anonymously is to shop local, dish out cash, and avoid gold quantities or coin types that require IRS reporting. Still, you might be able to find a private seller through a trusted local dealer network. You could also visit a local jewelry store to shop the weekend sale.
Is there a limit on how much gold you can buy? ›
People purchase gold for various reasons, may it be for auspicious occasions or for the love of wearing ornaments. On the other hand, gold also seems to be a favourite investment option for many people given the fact that there is no restriction on how much gold an individual can hold.
