taxes

[FormerTeller]

Been mulling this over for awhile, and with tax time coming up thought I'd throw this out to you all for input.

How many of you either pay taxes, or plan to pay taxes once you eventually sell your silver? Assuming you have to pay capital gains taxes, it would seem prudent to keep track of your expenses each year (mileage at least), and claim that as a deduction each year.

On the other hand, I've heard that profit gained from a "hobby" is not taxable.

Comments?

 

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[palidin20603]

Sales of coins for non-millionaires would be a 25% rate depending on income as a collectable.

 

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[palidin20603]

Sales of coins for non-millionaires would be a 25% rate depending on income as a collectable.

Also you can reduce gains from collectables with capital losses, so if you have losing stock or bond positions you want to liquidate you can generate stock losses to offset collectible coin gains.

HH

 

[jr98119]

Sorry, former teller, I did not express myself properly. You can show your gains/losses/profits in 2 ways:
1. The hobby loss rules apply if you are in "business" like the coin roll hunting business. The profits are at your regular tax rates plus self employment tax (yuck) in those years in which you make a profit. On the other hand, you do get to deduct losses in loss years, and this is netted against your regular income to lower your total tax burden. You don't have to show a profit for the first 2 years, but you will have to prove the 2 out of 5 rule retroactively if you are "examined."

2. The capital gains rate of 28%, though, applies if you report coin sales as an "investment" rather than as a business, and only if you make a profit. You can avoid this by selling your silver to me at less than face value (roflmao).

 

[ivan salis]

sell below the must report amount of $600 - say $ 500 at a time and in differant places * no paper trail no proof - unless theres a 1099 showing it -- its extremely remote that the IRS - will link $500 sale of coin by mr smith from one coin store sale with the $500 sale mr smith from a differant one , even thought * proof of ID is recorded at each sale --so there is in fact a "thread" they can track if the IRS wants to work that hard at it - but thats doubtful) --

however know this if one gets $600 or over per year in "profiets" the IRS will veiw it as "taxible" income -- AND much like a gambling win -- one can only deduct "losses" up to the amounts of "wiinnings" -- SO you can only "break even" basically -- once you reach the point where you lose more than you win --tough luck buddy you can not "deduct a "loss" anymore. *its a money losing "hobby" AT THAT POINT --too bad -- but iif you gain money more than you lose , well then its a "money gaining hobby" aka as a bussiness via the IRS way of thinking and you will be taxed on the money "earned" from it. ( so its very simple - do not earn any profiet from it ., make sure to track all expenses and be sure to "break even" 3 years out of 5 and to earn only a few dollars in profiet in the other 2 years out of 5 )

 

[palidin20603]

sell below the must report amount of $600 - say $ 500 at a time and in differant places * no paper trail no proof - unless theres a 1099 showing it -- its extremely remote that the IRS - will link $500 sale of coin by mr smith from one coin store sale with the $500 sale mr smith from a differant one , even thought * proof of ID is recorded at each sale --so there is in fact a "thread" they can track if the IRS wants to work that hard at it - but thats doubtful) --

however know this if one gets $600 or over per year in "profiets" the IRS will veiw it as "taxible" income -- AND much like a gambling win -- one can only deduct "losses" up to the amounts of "wiinnings" -- SO you can only "break even" basically -- once you reach the point where you lose more than you win --tough luck buddy you can not "deduct a "loss" anymore. *its a money losing "hobby" AT THAT POINT --too bad -- but iif you gain money more than you lose , well then its a "money gaining hobby" aka as a bussiness via the IRS way of thinking and you will be taxed on the money "earned" from it. ( so its very simple - do not earn any profiet from it ., make sure to track all expenses and be sure to "break even" 3 years out of 5 and to earn only a few dollars in profiet in the other 2 years out of 5 )

Gambling losses and capital losses are quite different. You are right that you break even with gambling losses, but you can deduct up to $3,000 a year of capital losses.

Also no matter how many Millions or Thousands of dollars of collectibles you sell, the IRS can not recharaterize a capital asset as inventory in a business if you are simply buying and selling at will. It takes more to prove the existence of a trade or business then that.

 

[MIhunter]

Bottom line:
Taxes aren't fair
The logic behind them is in the eye of the beholder.
The IRS shows no mercy
Whatever they collect won't be enough to match the spending habits of Congress.


Happy Hunting!!

 

[Bigheed]

Every coin / bullion shop out here says they don't issue a 1099 unless you sell $1000 face or more.

http://about.ag/reporting.htm

and heres a quote from the webpage you can find yourself just scrolling down a little to the "selling silver" section

So selling any type of silver other than 1,000 ounce bars and 90% silver coins should not be reportable in any quantity (unless you are suspected of avoiding reporting requirements). In the case of 1,000 ounce bars, a single bar would likely be reportable (since 'mini' contracts trade a single bar). In the case of 90% silver coins, it should only if in $1,000 face value quantities or more, or possibly $10,000 or more (the specifications for the contract the amount is based on are no longer publicly available!). However, it is unknown if 90% silver coins are required to be reported in the $1,000 face value quantity (since such futures contracts are not currently traded).

That just means the shop isn't required to issue you a 1099 if its less than $1000 Face of junk, however it doesn't exclude you from having to report it as income.


Bigheed

 

[ivan salis]

so 2 years in a row you can claim up to $3,000 in capital losses turn say $5 profiet the third year , show a $3,000 loss the 4th year and a $5 profiet the 5th year -- for a grand total of total of - $9,000 in losses and + $10 in gains over 5 years and be "legal" tax wise?

now thats "bookkeeping"

 

[palidin20603]

You can show capital losses up to $3,000 every year. The formula is as follow:

ST Capital Gain
Less: ST Capital Losses
Net loss or gain

LT Capital Gain
Less: LT Capital losses
Net loss or gain

Then add ST and LT net and that is what goes on the 1040 up to $3,000 in capital losses. ST losses can offset LT gains and vice versa.

HH

 

[Lyfeguard]

I am assuming we are talking about "The Big Sell Off", if and when the price of silver soars. Anything other then that you could just piece it out $599 at a time. As for the big dump, can't you claim it as inheritance or a gift. Recently I inherited a few valuable things and questioned my tax guy about auctioning some of it. He said taxes are based on the items appreciation from the date you took ownership.

 

[palidin20603]

I am assuming we are talking about "The Big Sell Off", if and when the price of silver soars. Anything other then that you could just piece it out $599 at a time. As for the big dump, can't you claim it as inheritance or a gift. Recently I inherited a few valuable things and questioned my tax guy about auctioning some of it. He said taxes are based on the items appreciation from the date you took ownership.

All of which is tax evasion and illegal. When you sell any PMs you are required to report them on Sch. D and attach to your 1040. What you do is between the IRS and you. I make no judgements, just stating the facts.

HH

 

[SFBayArea]

I'm hard at work preparing tax returns for millionaires, but i will take 2 minutes to quickly reply to several things mentioned above:

1. The threshhold for a 1099-Misc is $600.
2. The "hobby loss rules" mean that you have to make a profit in at least 2 out of the last 5 years to be able to deduct expenses in any year.
3. Um, gold and silver sales are taxed at a "collectable" rate of 28%, not a long-term capital gains rate of $15%.

I'm in a generous mood today after finding 4 40%'ers in 2 boxes last night. Ask me any questions on this topic for the next 2 hours and I will waive my hourly fee!

40%ers don't count as part of the gold and silver rules from what I heard. They're not majority silver. You don't need to list them as gold or silver on your tax form anyhow. Last year, I just wrote down "Coin" under capital gains. It was a combination of mostly copper cents, BU Clad rolls, and some silver 40%ers. If you sold large quantities to companies for gold and silver, they issue you 1099's but not for 40%ers. I haven't sold any 90%ers so I'm ok. I still get the 15%. Not concerned about the coin thing at all, more concerned about stock trades that I have write down. Did a lot of trades last year, and I dread having to put them down because it's going to take a lot of work.

What does it matter to the IRS? I doubt any of us here have made so much off this stuff to make a difference between 15% & 28%. They should be happy that you're reporting it. Even if they ask you about it (doubt it), you just say you didn't know that 90%ers get taxed higher, you were just honest and wrote down "coins". They'll be happy that you're at least reporting it. All I can say is the it is unfair that Romney gets away with paying 15% with his Swiss & Cayman Island bank accounts, why shouldn't most of us pay his rate who are not multi-millionaires? That's ridiculous. Make him pay 28% and the rest of us 15%. Even if he pays 28%, cry me a river. Doubtful he'll be concerned about being poor or the poor then.. LOL..
Those who don't report it, well that's a different story.

 

[quiksilver]

This whole thread is lol

 

[Farchaus2k]

This whole thread is lol

+1 for Paranoia

 

[SFBayArea]

This whole thread is lol

+1 for Paranoia

Love that Scrooge McDuck avatar. I remember when I watched Duck Tales as a kid. I was always in awe of Scrooge's money bin where he swam in the coins. Wished someone had that in real life.

 

[Gareb]

Can't believe people here are advocating for tax dodging. If you can count your miles and your gas receipts for deductions, then do it. Obviously if you made only a couple bucks, it's not worth it to report it. But if you sold and you got a couple thousand in profit, those are capital gains. You can probably do it the Romney way and get away with 15% if those coins you got over a year ago. No one keeps track of when they got the specific coin anyhow. I hope people here will do the right thing and not become tax dodgers. Reporting sales of coins is nothing compared to reporting tons of stock trades. Now that is a pain in the A$$. Hopefully people here will do the right thing and put it down. You lump the sum of all coin sales minus costs & face value into one transaction to make it easy. IRS is not going to question you on that.

Doesn't count if you are just holding. Only counts when you sell.

Pardon me for starting this but this statement really ticks me off. While I am not a Romney supporter, And definitely not a lib or democrat. He paid his taxes as required by law, it is simply NOT getting away with anything as you claim. Capitol gains taxes are just that, taxes on gains, do not forget there were also taxes paid before there were gains. If we are not "allowed" to get away, as you say with only a 15% tax, then god help us, as there will be no business left in this country and no reason to invest into it. I will get off my soap box now.
Good luck out there.
Mike

 

[palidin20603]

From my experience no one has any law or court case to support getting 15% rates on the sale of any coins. Under an audit you would have to cough up the difference up to 25% or 28% depending on your AGI. Just a warning, it doesn't bother me what anyone does on their return. If someone here has support, please let me us know so we can use it on our returns. I have sold 40%ers this year too.

HH