In general, you have to pay taxes when you sell gold if you make a profit. According to the IRS, precious metals such as gold and silver are considered capital assets and financial gains from their sale are considered taxable income. In another example, someone walks into a local gold coin store and uses cash (paper money) to pay for gold coins. The IRS has specific rules that determine which sales of precious metals require the dealer to submit this form.
Reportable sales (again, customer sales to dealers) apply to 1-ounce Gold Maple Leafs, 1-ounce Krugerrands, and 1-ounce Mexican ounce in quantities of twenty-five or more in a single transaction. This is because some gold items do not meet the minimum purity composition to be considered declarable. Form 8300 requires information about the gold purchaser, including name, social security number, address, and license number. Both ETFs and gold bars have their value linked to the underlying price of gold, so both provide a certain degree of balance to major assets.
The IRS does its job well, but naturally, you want to get the most money for your gold and, hopefully, not lose a cent on the sale. This includes things like stocks, bonds, real estate investment trusts (REITs), and collectibles such as gold. To buy ingots, it's probably best to go to a reputable gold dealer for a wide variety, guidance and good general advice on when buying and selling. Notification laws for gold purchases are similar to the “Know Your Customer” law, popularly known as “KYC”, which banks are required to use to prevent money laundering.
Gold coins are generally considered to be a better investment than gold bars, as long as you buy the right ones. Instead, sales of physical gold or silver must be reported on Schedule D of Form 1040 of your next tax return. This means that you reinvest the money from your gold sale by buying more gold and, if you meet the IRS requirements, all of these transactions will not be taxable. In addition to these cases, there are several precious metal coins that are exempt from government reporting, regardless of their sales amounts.
While the law may say that you can sell gold and silver without paying taxes, that doesn't mean that it translates into practice with the IRS. For those who buy gold in the United States, there are some federal laws that you should be aware of specifically, the regulations that govern which purchases of gold should be reported to the government.