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Tax Implications and Reporting Requirements for Bullion Transactions
For many of our customers, investing in precious metals serves as a passive form of income that enables them to generate profits simply through the sales or market activity of their bullion. However, as with any other sources of income, passive or otherwise, customers need to be aware of the tax implications associated with their transactions. According to the IRS’s policies, there are two circ*mstances under which, precious metals dealers are legally obligated to report your transactions: when a customer sells large quantities of specific bullion pieces and when they pay $10,000 or more in cash. Failure to do so can result in penalty fines, criminal charges and even the possibility of imprisonment for both the precious metal dealer and the customer.When reporting either of the previously mentioned transactions, there are specific forms that precious metals dealers are required to fill out. These include a 1099-B and an 8300, respectively. Please be advised that while JM Bullion is required to provide certain information about our customers, these details remain strictly confidential between us and the IRS; at no point will any third party have access to their private information.
1099-B Form
The 1099 series is a set of forms used to report any profits made by non-corporate sellers. They allow the IRS to prevent any instances of tax evasion by keeping track of individuals who may be selling items as a source of income. In the context of precious metal transactions, dealers are required to fill out a 1099-B form when a customer sells them any of the products mentioned in the IRS’s Reportable Items List according to the predetermined reportable quantities. The reporting criteria varies according to the particular coin or bullion piece sold.The reporting criteria for bars and rounds sales by customers is primarily determined by the purity and the quantity of the individual products. However, this criteria differs for each kind of precious metal. For sales of gold bars and rounds to be considered reportable, every individual piece of bullion must have a fineness of at least .995 and the total purchase quantity must be 1 kilo (32.15 troy ounces) or more. Similarly, for sales of silver bars and rounds to warrant reporting, each silver piece needs to possess a fineness of at least .999 with a total purchase quantity of 1,000 troy ounces or more. Lastly, sales of palladium and platinum bars or rounds require the smallest qualifying quantities of 100 troy ounces and 25 troy ounces, respectively. The fineness restriction for both metals is .9995.When compared to bars and rounds, the reporting criteria for coin sales by customers is slightly more straightforward since the restrictions are so specific. There are only a few coins that are eligible for reporting. Among those coins are the 1 oz Gold Maple Leaf Coins, the 1 oz Gold Kruggerand Coins, the 1 oz Gold Mexican Onza Coins and any US coin composed of 90% silver. We are required by law to report any sales of 90% silver US coins that exceed a face value of $1,000, as well as any sales of the previously mentioned gold coins, in which more than 25 pieces have been sold.There are, of course, a number bullion products that are exempt from reporting, regardless of the quantities that a customer sells. Such pieces include, but are not limited to gold coins with fractional denominations; Gold or Silver American Eagle Coins; any pieces of foreign currency that were not explicitly mentioned in the IRS’s Reportable Items List, as well as pieces of US currency that were created subsequent the list’s creation in the 1980’s.
Form 8300
According to federal tax laws, precious metal dealers are not only required to report certain sales by their customers, but they are also under legal obligation to report any cash payments they may receive for a single transaction of $10,000 or more. These laws were originally developed by the National Treasury in the 1980’s as a way to monitor large commodity exchanges within the US. By reporting these significant cash payments, the IRS is able to prevent any potential money laundering schemes, which could hurt the nation’s economy.In order to report the receipt of such payment, precious metal dealers must fill out an 8300 form. As with the 1099-B form, precious metal dealers are required to disclose the payment details of their transaction, as well as some information about the paying customer. Please be advised that while customers have the option of withholding some of this information, precious metal dealers are still required to file this form.With regards to precious metal purchases, the term “cash” is defined as the use of the following payment methods for purchases of $10,000 or less: traveler’s checks, cashier’s checks, money orders and bank drafts. The term “cash” can also refer to any payments made with US or foreign currency. Please note that using any of the previously mentioned forms of payment for purchases exceeding $10,000 does not constitute as cash and consequently, will not be reported to the IRS. Other forms of payment that are exempt from reporting include personal checks, bank wires, credit/debit cards, PayPal and ACH transfers.
Capital Gains Tax
As previously mentioned, selling precious metal merchandise can serve as an additional source of income for many customers. Therefore, in the eyes of the IRS, any profits a customer acquires through the sale of their precious metal assets is considered taxable and is subject to a form of taxation known as “capital gains” taxes. “Capital gains” refers to any profits that resulted from the sale or exchange of personal stock or assets. In terms of precious metals, capital gains are acquired when a particular coin or bullion piece increases in value and is then sold at that higher price. This price difference between the initial price of the precious metal and its final sale price is considered capital gain. Consequently, any such profits are subject to the capital gains tax. Please be advised that such profits are only considered as capital gains if the precious metal asset is sold. Increases in the value of an individual’s precious metal bullion due to market fluctuation will not be recognized as a capital gain and as a result, will not be subject to any taxation.
Reportable Bullion Transactions with JM Bullion
Because JM Bullion is a reputable online dealer, all purchases and sales of precious metal coins and bullion will be conducted according to the IRS policies outlined above. Please note that while this article is intended to help our customers understand the tax implications of their precious metal sales and purchases, it is not intended to serve as financial or legal advice. We encourage customers to consult with a tax professional for more specific details regarding their individual situations.
Tax Reporting FAQs
Does JM Bullion give out any of my information?
JM Bullion will never disclose any of our customers’ private information for reasons beyond certain IRS reporting policies, such as 1099-B and 8300 forms. Please note that even under these circ*mstances, our customers’ information will remain strictly confidential between JM Bullion and the IRS. At no point will any third parties have access to this sensitive information.
What is a 1099-B?
A 1099-B form is used by precious metals dealers to report when a customer sells them any of the products mentioned in the IRS’s Reportable Items List, according to their individual reportable quantities.
What is considered cash and what is not?
“Cash” is defined as any transaction payments of $10,000 or less that are made with traveler’s checks, cashier’s checks, money orders and bank drafts. Cash also refers to any purchases made with US or foreign currency. Personal checks, bank wires, credit/debit cards, PayPal and ACH transfers do not constitute as cash regardless of the payment amount.
Why is this form required, and why is it in place?
1099-B forms are used to inform the IRS of any profits made by a non-corporate seller. They enable the IRS to prevent any potential tax evasion by monitoring individuals who may be selling items as a source of income.
What types of bullion are exempt from a 1099-B? Which are not?
Gold coins with fractional denominations; Gold and Silver American Eagle Coins; any pieces of foreign currency that were not mentioned in the IRS’s Reportable Items List; and any pieces of US currency that were created subsequent to the list’s creation are all exempt from reporting through a 1099-B form. However, any of the coins or bullion pieces that are mentioned on the IRS’s Reportable Items List are subject to reporting, provided they meet the prescribed quantities. These include 1 oz Gold Maple Leaf Coins; 1 oz Gold Krugerrand Coins; the 1 oz Gold Mexican Onza Coins and any US coin composed of 90% silver, as well as all precious metal bars and rounds.
Why are certain products exempt from a 1099-B?
Certain products are exempt from the 1099-B form, because they do not meet the minimum composition purity. This applies strictly to precious metals bars and coins. Other products are exempt, because they possess a fractional denomination. Still, the most common reason that products are exempt from reporting is due to the fact they were not in existence when the IRS’s Reportable Items List was created.
Do I have to pay taxes if I sell gold or silver?
When customers sell their gold or silver, they are only required to pay taxes if they made any profits from the sale, in which case they will be required to pay capital gain taxes. However, if the sale of their gold or silver assets results in loss or no profit, customers will not be subject to the capital gains taxes. Please note that these tax policies can vary for state to state and customers are advised to seek a tax professional for more specific details.
What is a Form 8300?
A form 8300 is used by precious metals dealers to report any cash payments they receive on transactions of more than $10,000. They are required by the IRS to keep track of substantial commodity exchanges within the country.
What types of transactions require a Form 8300?
Precious metals dealers are required to report any single transaction in which a customer provided a cash payment of $10,000 or more. Also subject to reporting are any sales that occurred within a 24 hour period and whose combined total is equal to or greater than $10,000.
Do I have to pay sales tax on my purchase?
We are required to charge sales tax in certain states for certain products. You can find tax information for your state here. Always be sure to speak with your tax adviser for specific taxation advice in your jurisdiction
FAQs
About. Please note that base shipping and insurance, on all JMB orders over $199, is free (orders <$199 pay $9.95). Customers can utilize our free shipping method or may have the option to upgrade their shipping method upon checkout.
Does JM Bullion have free shipping? ›
About. Please note that base shipping and insurance, on all JMB orders over $199, is free (orders <$199 pay $9.95). Customers can utilize our free shipping method or may have the option to upgrade their shipping method upon checkout.
Has JM Bullion ever sold fake gold? ›
Authenticity. One of the most common questions we receive about our products is “How do I know the gold or silver I buy is real?” Well, fake gold and silver does exist — there is no doubt about that — but here at JM Bullion we take a great deal of pride in assuring the authenticity of each of the products we sell.
What is the most trusted place to buy gold and silver? ›
Best Comprehensive Offering APMEX (American Precious Metals Exchange) With more than 46,000 products to offer, APMEX (the largest online precious metals dealer globally) makes our list as the online gold dealer with the best comprehensive offering.
Which is better apmex or JM Bullion? ›
In this JM Bullion vs APMEX comparison, we'll be taking a closer look at two well-known precious metals dealers.
...
JM Bullion vs APMEX 2023.
| JM Bullion is Better for: | APMEX is Better for: |
|---|
| Generally lower gold prices | Buying collectible coins |
| As a BBB-rated reputable dealer | Finding a wide variety of products |
1 more rowIs JM Bullion Legit? There are numerous physical sites for JM Bullion all around the US. Since the firm is handled by reputable individuals, it is not a scam but rather a legitimate precious metals enterprise with over ten years of experience.
Is JM Bullion a legit site? ›
JM Bullion is a very reliable and trustworthy company. Products always arrive quickly and in great condition.
Does JM Bullion report to IRS? ›
Most reporting regulations revolve around the amount of the investment and the type of payment used. JM Bullion files both IRS Form 1099-B and IRS Form 8300 when required. Form 1099-B is used to report profits made by non-corporate precious metals sellers.
Has JM Bullion sold fake silver? ›
Since the majority of our products are sourced directly from the most respected mints across the globe, customers can place their orders with full confidence they are purchasing a genuine silver or gold collectible.
What is the most counterfeited gold coin? ›
More commonly counterfeited gold coins are Chinese gold pandas, $20 Liberty Head gold coins and St. Gaudens gold coins.
DigiGold is India's most trusted digital platform for gold and silver where you can buy, sell and store online at live market rates. The minimum amount of purchase starts from just Rs 1. We also offer No locking period SIP in Gold with just starting Rs. 500 through periodic installments.
What does Dave Ramsey say about buying gold and silver? ›
I'd stop investing in gold and silver completely. I don't put money in precious metals at all, because they have a lousy long-term track record.
Is it worth buying gold and silver right now? ›
The answer is yes, based on the current economic conditions and potential market volatility. Investing in precious metals such as gold and silver can help protect your portfolio against inflation and economic uncertainty.
What is the most sought after bullion? ›
Here are the ten most popular bullion coins in the world, based on their popularity and availability.
- American Gold Eagle. ...
- Canadian Gold Maple Leaf. ...
- South African Krugerrand. ...
- Austrian Gold Philharmonic. ...
- Chinese Gold Panda. ...
- British Gold Britannia. ...
- Australian Gold Kangaroo. ...
- Mexican Gold Libertad.
Silver bullion can typically be acquired at lower premiums than silver coins and has a value that closely tracks the spot price of silver. This means that as long as you properly store silver bullion, you can reliably track changes in its value by checking the current price of silver.
Which bullion is best? ›
American Eagle Gold Bullion Coins are considered to be one the best gold coins to buy in United States.
Is it safe to buy silver bullion online? ›
Buying online is as safe as buying from a physical retailer, if not even safer. Whether you're interested in purchasing gold bars or coins, you can buy gold online and be safe as long as you deal with a reputable gold company, such as International Precious Metals.
How long does it take to get gold from JM Bullion? ›
Shipping Methods
Overall, the total time it can take for your package to arrive from order placement to delivery will usually be anywhere from 5 days to 2 weeks, however, in some rare cases it can take up to 6 weeks.
What is the lawsuit against JM Bullion? ›
A Settlement has been reached in a class action lawsuit against JM Bullion and its subsidiary Provident Metals (together, “JM Bullion”) for a data breach (the “Data Breach”) that occurred between January 1, 2020 to July 17, 2020 when unauthorized users gained access to JM Bullion's website through malicious code and ...
Why did JM Bullion cancel my order? ›
JM Bullion reserves the right to cancel orders where payment is not dated within two (2) business days for bank wire orders or one (1) business day for paper check orders.
Founded in 2011, JM Bullion is an online, precious metals retailer that offers gold and silver products from bars and rounds to coins. The corporate headquarters is located in Dallas, Texas.
Are JM Bullion orders insured? ›
Orders are shipped in inconspicuous packaging via either USPS, UPS or FedEx. * All shipments are fully insured.
How much silver can you buy without reporting to IRS? ›
995 and the total purchase quantity must be 1 kilo (32.15 troy ounces) or more. Similarly, for sales of silver bars and rounds to warrant reporting, each silver piece needs to possess a fineness of at least . 999 with a total purchase quantity of 1,000 troy ounces or more.
How much gold can I buy without reporting? ›
Many wonder how much gold they can buy without reporting it to the IRS. The answer is that there is no limit on how much gold you can purchase without reporting it. However, any sale of precious metals, including gold coins, must be reported on your tax return.
How much gold can a US citizen own? ›
Physical gold. According to the CBDT's most recent circular, men, regardless of marital status, are only allowed to possess 100 g of real gold in the form of jewelry and ornaments. Married women are allowed to possess 500 g, unmarried women 250 g, and men 500 g.
What are the most faked silver coins? ›
In particular, many bullion resources claim that the 1916-D Mercury Dime is one of the most common counterfeited coins in the industry.
Does tarnished silver bullion lose value? ›
Though tarnish on silver doesn't reduce its monetary value, it can make it unsightly. Cleaning and polishing the bars can bring back their natural beautiful luster.
Is tarnished silver bullion worth less? ›
Does tarnish affect the value of silver bullion? The value of silver bullion coins and bars should not be affected by tarnishing. This is because silver bullion products are typically valued by weight and purity, not specifically by condition and aesthetic appeal.
What is the most faked U.S. coin? ›
Certain key date coins are notoriously susceptible to counterfeiting. 1916-D Dimes and 1932-D Quarters are favorite targets of counterfeiters, as adding a “D” mintmark can add hundreds if not thousands of dollars in value.
What gold coin is illegal to own? ›
Currently, with the exception of the one sold on July 30, 2002, 1933 double eagle coins cannot be the legal possession of any member of the public, as they were never issued and hence remain the property of the United States government.
Unlike the 22-karat American Gold Eagle coin, one of the world's most popular gold bullion coins, each Gold Buffalo coin is struck from . 9999 fine gold. As the first gold coins in the United States offered with this purity, Buffaloes likewise became very popular.
What is the disadvantage of buying gold online? ›
Disadvantages with spread cost and capital gain tax
In the case of digital gold, there is an additional cost charged from an investor, which is spear cost. A spread cost will be counted with multiple additional costs like - storage cost and insurance cost, etc. The spread cost is generally ranged between 3% and 6%.
Is it better to buy gold coins or bars? ›
Gold coins are known to have more sentimental value than gold bars both historically and culturally. Simply put, gold coins can be more ideal for you than gold bars if you want to invest in something with a more historical and cultural value. Again, gold coins have more collectible value than gold bars.
What is the most profitable way to buy gold? ›
Investing in a gold stock, ETF or mutual fund is often the best way to get exposure to gold in your portfolio. In order to buy a gold stock or fund, you'll need a brokerage account, which you can open with an online broker (here's a step-by-step guide to opening a brokerage account).
Why does Dave Ramsey not like gold and silver? ›
Ramsey claims gold and silver fail to protect against inflation and would be useless during a financial crisis: “The prices of gold and silver are so unstable (and have been over time) that the only use for them in an economic crisis would be to hope someone would take your silver coins or watch in exchange for a pack ...
How much of my money should be in gold and silver? ›
GuruFocus.com suggests an overall 10–20% allocation of precious metals, with silver making up a 30% share of that allocation if you're aiming to preserve wealth. “Silver and gold belong in every balanced portfolio. There's no magic percentage of silver and gold you should include,” GuruFocus.com advises.
How much gold should I own? ›
Consequently, conventional wisdom recommends holding no more than 10% of your portfolio in gold as part of a well-balanced portfolio. Allocating a slice of gold to your portfolio may help to hedge against inflation. That's because gold has an inverse relationship with the dollar.
Which day is good to buy gold in a week? ›
Which day is good for purchasing gold? The best day to purchase gold is Akshay Tritiya or Akha Teej.
Should I buy gold now or wait 2023? ›
Don't Wait to Buy Gold, Buy Gold & Wait
There are plenty of potential economic, geopolitical, and social factors next year that could propel gold prices to new highs. Expert predictions and institutional investments clearly indicate that gold is a good investment in 2023.
When to buy gold in 2023? ›
Akshaya Tritiya 2023: Shubh Muhurat to buy gold
People can buy gold today from 7.49 am to 7.47 am on April 23 (Sunday).
Here are 10 of the best gold coins to buy based on their uniqueness, rarity, and popularity among investors.
- Gold American Eagle.
- American Gold Buffalo.
- South African Gold Krugerrand.
- Canadian Gold Maple Leaf.
- Gold Britannia.
- Gold Austrian Philharmonic.
- Gold Australian Kangaroo.
- Chinese Gold Panda.
- Silver coins are considered the easiest to sell, since it's fairly easy to quickly liquidate (i.e., get cash for) coins. ...
- Silver rounds look very similar to silver coins, but it's easier to sell coins than rounds.
Gold bullion is the most popular type of gold to hold as an investment or store of value, as it's generally easy to sell, and maintains its value well. When we're talking about selling gold, you can also get a good amount of money by selling gold wedding bands, engagement rings and other types of jewelry.
Should I buy silver rounds or eagles? ›
Because the price of Silver Buffalos depends primarily on the spot price of silver, these rounds are less expensive than Eagles. Silver Buffalos do not have a government mint premium, so they are the more affordable option if you want to add larger amounts of silver to your stack or portfolio.
Is it better to buy silver eagles or bars? ›
Silver coins offer several advantages over investing in silver bars, such as easier selling of smaller quantities at once, higher resale value due to collectible value and rarity factors, and better protection against counterfeiting or fraudulent products.
What is the best form of silver to buy? ›
For investment purposes, you should buy fine silver which has a purity standard of 99.9%, as the price of silver bullion is based on the precious metal content rather than a fluctuating spot price, or current market price, determined by a third party.
Is JM Bullion a good place to buy gold? ›
JM Bullion provides its customers with a user-friendly website, transparent pricing structure, dedicated customer support, and investor-friendly features, making it our choice as the online gold dealer with the best customer experience.
Does JM Bullion have a good reputation? ›
The Better Business Bureau granted JM Bullion accreditation in July 2014, and the company now has an A+ rating with them. The business had 818 customer reviews and 320 customer complaints on the platform at the time this post was being written.
What shipping does JM Bullion use? ›
Orders are shipped in inconspicuous packaging via either USPS, UPS or FedEx. * All shipments are fully insured.
How long does JM Bullion take to ship? ›
Shipping Methods
Overall, the total time it can take for your package to arrive from order placement to delivery will usually be anywhere from 5 days to 2 weeks, however, in some rare cases it can take up to 6 weeks.
jmbullion.com 2nd most similar site is providentmetals.com, with 373.9K visits in March 2023, and closing off the top 3 is sdbullion.com with 2.9M. gainesvillecoins.com ranks as the 4th most similar website to jmbullion.com and bullionexchanges.com ranks fifth.
Is it safe to buy gold bullion online? ›
Buying online is as safe as buying from a physical retailer, if not even safer. Whether you're interested in purchasing gold bars or coins, you can buy gold online and be safe as long as you deal with a reputable gold company, such as International Precious Metals.
What is the best way to ship silver? ›
The best and safest way to ship Gold & Silver Bullion is by using the United States Postal Service's Registered Mail service. Why Registered Mail? USPS Registered Mail offers the pinnacle of both safety and insurance. In fact, you can get up to $25,000.00 of insurance per Registered Mail parcel.
What is good delivery gold bullion? ›
The Good Delivery specification is a set of rules issued by the London Bullion Market Association (LBMA) describing the physical characteristics of gold and silver bars used in settlement in the wholesale London bullion market.
Is JM Bullion silver real? ›
Since the majority of our products are sourced directly from the most respected mints across the globe, customers can place their orders with full confidence they are purchasing a genuine silver or gold collectible.
What is the best way to buy bullion? ›
One common way to purchase gold bars is through licensed retailers online. Prospective buyers can browse gold bar products on reputable retail websites such as the American Precious Metals Exchange (APMEX), JM Bullion, and Wholesale Coins Direct.
Does JM Bullion require signature for delivery? ›
Orders under $1000 will not require a signature unless that option is selected and paid for at checkout. Orders over $1000 will always require a signature for delivery. Please note, per our Terms and Conditions, once a package shows delivered, our responsibility ends.
Can the government take your gold bullion? ›
Under current federal law, gold bullion can be confiscated by the federal government in times of national crisis. As collectibles, rare coins do not fall within the provisions permitting confiscation. No federal law or Treasury department regulation supports these contentions.
Is it better to own gold coins or bullion? ›
Gold coins are known to have more sentimental value than gold bars both historically and culturally. Simply put, gold coins can be more ideal for you than gold bars if you want to invest in something with a more historical and cultural value. Again, gold coins have more collectible value than gold bars.
Is it better to invest in gold or silver bullion? ›
Bottom line. Both silver and gold can function as safe haven assets, but gold tends to have a better track record over long periods of time. That said, over shorter periods the specific dynamics of each market end up being more important to their respective returns.
Junk silver has significant value, but it may be more difficult to sell your investment. Bullion is highly pure and makes buying and selling easy. If you choose to purchase bullion, Royal Bull has some valuable gold, silver and platinum options that may fit nicely into your investment plan.
