Go to main Forum page »
Years ago I bought some Gold Eagles. Now with gold trading at near historic highs, I figure it may be a good time to sell. If you have sold your gold, I’d be very interested to hear your thoughts on the process, especially in regards to maximizing the sales price.
You asked for thoughts about selling gold coins and my response to stelea99 was about the tax rules. Clearly I addressed a question you did not ask, but your question did get me thinking about about what is the likely way to sell physical gold for the best price. My past experience with physical gold focused on people who were selling or had sold gold they had inherited and needed to report the DOD value on an estate return or the sale on a 1041 or 1040 tax return.
A little internet search first took me to some articles about gold by financial writer Dan Burrows at Kiplinger.com that focused on investing in gold funds, companies that produce gold and how gold investments performed but nothing much about the actual process of selling physical gold coins.
I later came across the below link to an article that may help address your original question about the likely selling options that sellers of physical gold coins have. The article in Part 2, point 3 has a couple of links to online sites that appear to offer auction services to sell gold coins.
https://www.wikihow.com/Trade-Gold-Coins-for-Cash#_note-12
I hope this helps.
Unless your coins have some numismatic value (rare coins), when you sell, you will get the current market price less whatever the dealer fee will be for handling your sale. Call around to a few dealers in your area to get some idea of what these costs are today. Typically these charges run in the 5-6% area. You probably paid more than the spot price when you purchased the coins as a commission to the dealer.
Don’t forget that you will owe the taxman for the tax on the difference between what you paid for the coins and what you receive when you sell them. This tax is calculated as ordinary income, not Capital Gains.
It would be interesting to hear what you paid for one coin, and what you received when selling, and the dates for the purchase and sale. We could then calculate what your actual annual rate of return for holding the coins for that period of time.
You might want to calculate the actual tax before you sell…..,
I believe the sale of gold is deemed to be the sale of a collectible. If owned short term (1 year or less) the gain or loss is treated as short term.
If the sale is long term the gain is taxed at a maximum income tax rate of 28% under the current long-term capital gains rules.
Any collectible gain can also be subject to the federal Net Investment Income Tax if your income is high enough (which is based on your return filing status) which may add another 3.8% tax plus appropriate state taxes.
If Michael solely owns the gold coins at his death the coins his beneficiary inherits would get a basis adjustment to the coins FMV at his DOD and avoid any gain (or loss) but his beneficiary would still not avoid the tax reporting requirement.
The tical charges I’ve seen is +3% buying, -3% selling.
Stelea99, and William Perry, While I appreciate your concerns about how it’s taxed, currently I’m more concerned about how it’s sold. When it is, I’ll definitely think about circling back with you both.