Thread topic: Tax reporting requirements when selling Gold and Silver Bullion

[Deck Chair Boy]

Although it could be years before I sell any of my gold or silver bullion, I was hoping to establish a thread where we could share information about reporting requirements in the countries we are citizens or residents of. Maybe I will never have to sell my bullion, but instead trade it for food, a house, land, lyposuction. Lyposuction?

Anyhow, in my case, I am a U.S. citizen, but I may become a Canadian citizen in the future. I have a feeling that solid information on this topic could be hard to come by but could be important to alot of us someday.

Would someone please give me a few sentences or a link on how sales of bullion coins, such as Krugerrands, and silver bullion, such as 10 and 100 Oz. bars, are required to be reported in Canada by Canadian citizens for tax purposes? From what I have read, I think that any sales would be required to be reported as a capital gain.

Here in the U.S., different PM dealers in different states have very different views of what is reportable. It varies from reporting nothing to reporting the sale of every bullion item. I was hoping the Canadian laws were more understandable.

Anyway, here is a information source I have found on the U.S.

http://www.certifiedmint.com/myths_lies.htm

[PONCE]

I you read what I have posted before you will know that in 1980 I made around 750,000 tax free when I sold my silver bullion.

The trick is to buy and sell only the one oz round silver bullion, they are considered to be regular coins and non-taxable.

I believe that the same goes for the five oz's, but I am not sure,,,,stay away from the ten oz's and higher.

[Deck Chair Boy]

zhukher

Why? Well, if I sell my bullion to a PM dealer in Canada because I need Canadian fiat to buy something from a Canadian seller (of a house lets say), and the seller wants Canadian fiat only in payment, then, the Canadian dealer who sent me a check for my bullion may be required to report the transaction to the government (just like selling stock) and a capital gain needs to be paid. In other words a Krugerrand can be different from a used lawn chair just like a stock is when it is sold. There are PM dealers in the US that have great reputations that will not report a sale of bullion to them no matter how large it is. Bless them, but I wonder if there are such freedom-respecting dealers in Canada.

But I still may be missing your point.

Funny you mention that about internet bank account, I was just looking at everbank.com.

If you are thinking of moving to Canada, this link may be of interest.

http://www.escapeartist.com/efam11/Canadian_Immigration.html

[Deck Chair Boy]

Ponce

Wow. You're my hero. Thanks for the tip. Only 10% of my silver is in rounds.

[Libertarian_Guard]

Gold is considered a collectible by the Internal Revenue Service (IRS) in the United States.

http://www.streetauthority.com/cmnts/sp/2004/04-05.asp

[Infidel]

If you are thinking of moving to Canada, this link may be of interest.

http://www.escapeartist.com/efam11/Canadian_Immigration.html

It is an excelent article. I read it a while back. Escape artist is one of my reads for the week

Cheers.

BTW if yo do internet commerce check if say paypal accepts your bank.

Some banks do not allow paypal to go in and withdraw the funds. DYOD

[Chaps]

Buy a lawn chair at a garage sale for $10 and sell it on Ebay for $30, the feds expect you to declare $20 income on your 1040, doesn't matter what the commodity is. Will you do it? If your buyer asks you for your SS# then you can assume the IRS will be waiting for your check.

[Deck Chair Boy]

Chaps- I think I see what you mean. So, before I sell to any PM dealer or whoever, be they American or Canadian, I just need to ask them if they will report the sale. Then, when I get the check, be sure I know if my bank has some new rules to follow that may rat me out.

[lhslancers]

Be advised that if you deposit any check in a US bank which is more than $2999.00 the bank files paperwork on it. I don't know for sure how far this goes but these days and going forward the restrictions and the ability and appetite of the govt. are only going to increase. Modern computers are at once a blessing and a curse. Think brown paper bag in the church parking lot. Sell pieces on the way up. Dump the Silver Eagles first then the bars. You might want to keep some of the 90% for the end. Best of luck to all. Remember checks are not cash.

[Chaps]

Chaps- I think I see what you mean. So, before I sell to any PM dealer or whoever, be they American or Canadian, I just need to ask them if they will report the sale. Then, when I get the check, be sure I know if my bank has some new rules to follow that may rat me out.

If you elect to play it clean (pay the tax) you'll need to have a record of your cost basis (price you paid for the pm's) in order to accurately declare your profit on the sale. If you have no supporting docs AND you get audited for some reason (even perhaps for something other than the pm sale) they look at everything in your return and they will impute (IRS will guess) what you paid for the pm's and if deemed lower than what you declared they'll want more $$. I operate under the premise that it's too hard to remember who one has lied to or what one has falsely claimed. I bitch long & hard about taxes being to high and poorly utilized by the gov'mnt but I always pay every penny I owe . . . couldn't rest at night otherwise.

[Deck Chair Boy]

Better safe than sorry.

[LeadBrick]

Perhaps someone can comment on how the IRS estimates your cost basis? For example, if you walk into a store and pay cash, what tools does the IRS have to estimate your cost basis?

[hoarder]

The trick is to buy and sell only the one oz round silver bullion, they are considered to be regular coins and non-taxable.

I believe that the same goes for the five oz's, but I am not sure,,,,stay away from the ten oz's and higher.
I have never heard of this from anyone other than Ponce. How do you know this? If this is something you were told by a dealer years ago it may be false...and it may not be wise to tell your story. Unless you welcome a visit by the JBT's.

Anyone else ever heard of this?