REPORTING
To most gold and silver buyers, Privacy is of the utmost importance. Therefore it is essential to know that the US government requires TWO reporting obligations that bullion dealers have for customers buying and selling bullion.
Do You Report My Sales To The Government?
Although we do not report the majority of our customers’ sales to the government, we are legally obligated to file a 1099-B form when these sales apply to certain products or exceed a particular amount. Failure to report such sales could result in both civil and/or criminal tax penalties, as well as the possibility of imprisonment.
It is important for customers to understand that while the 1099-B form will require us to provide the some of the seller’s basic information, such as address and phone number, this information remains strictly between Gold Financial and the IRS. No other third parties will have access to this information. Customers, who would like to learn more about precious metals reporting policies, are strongly encouraged to either visit IRS.gov or consult with a professional tax expert.
1099-B Requirements
The criteria for reporting precious metals sales will depend upon a number of factors including product, purity, and quantity. Each of which will be discussed in further detail.
Product
When determining whether or not to report a sale, we first have to verify which particular products are being sold since certain pieces of bullion are exempt from reporting.
REPORTABLE ITEMS
1 oz Gold Canadian Maple Leaf
Minimum Fineness: As minted
Min. Reportable Amount:
25 1-oz coins
1 oz Gold Kruggerand
Minimum Fineness: As minted
Min. Reportable Amount:
25 1-oz coins
1 oz Gold Mexican Onza
Minimum Fineness: As minted
Min. Reportable Amount:
25 1-oz coins
90% US Silver Coins
Minimum Fineness: As minted
Min. Reportable Amount:
Any combination of dimes, quarters, or half dollars totaling $1,000 face value or more
All bars and rounds are also subject to reporting regardless of size and precious metal composition. However, there are some restrictions with regard to the purity of each bar or round.
Gold Bars/Rounds
Minimum Fineness: 0.995
Min. Reportable Amount:
Any size bars totaling 1 kg (32.15 troy oz.) or more
Silver Bars/Rounds
Minimum Fineness: 0.999
Min. Reportable Amount:
Any size bars totaling 1000 troy oz. or more
Platinum Bars/Rounds
Minimum Fineness: 0.9995
Min. Reportable Amount:
Any size bars totaling 25 troy oz. or more
Palladium Bars/Rounds
Minimum Fineness: 0.9995
Min. Reportable Amount:
Any size bars totaling 100 troy oz. or more
Purity
Another determining factor in whether a sale is subject to reporting is the purity or fineness of each particular bullion piece. Because the purity of coins is dictated by their inherent designs, there are no purity restrictions for the coins mentioned in the previous section. In the case of bars and rounds, however, the purity criteria will vary according to the item’s precious metal composition. Only sales on bars and rounds possessing the following compositions and purity levels will be subject to reporting: a gold fineness of at least .995; a silver fineness of at least .999; a platinum fineness of at least .9995; and a palladium fineness of at least .9995.
Quantity
The final step is to determining whether a precious metal sale needs to be reported is to evaluate the quantity being sold. We are required by law to report all sales of 90% silver US coins exceeding a face value of $1,000 as well as sales of the previously mentioned gold coins, where more than 25 pieces have been sold. As with purity, the qualifying quantities for precious metal bars and rounds will vary according to their precious metal composition. Sales of gold bars and rounds need to be 1 kilo (32.15 troy ounces) or more before we need to report them. Likewise, sales of silver bars and rounds must reach 1,000 troy ounces. Lastly, sales of palladium bars and rounds need to be at least 100 troy ounces before they require reporting, while sales of platinum bars and rounds need to be at least 25 troy ounces.
Exemptions
Sales in which any of the previously mentioned items fail to meet the required purity or quantity criteria will not be subject to reporting. In addition to these such cases, there are a number of precious metal coins that are exempt from government reporting regardless of their sales quantities.
EXEMPT PRODUCTS
American Gold Eagle Coins
American Silver Eagle Coins
Canadian Silver Maple Leaf
American Gold Buffalo Coins
Chinese Panda Gold/Silver Coins
Austrian Coins
Fractional Bullion Coins
Australian Perth Mint Coins
Why Does This Law Exist?
These laws regarding reporting precious metals were established by the IRS during the 1980’s as a means of keeping track of any profits made by non-corporate sellers. They are primary for taxation purposes.
They prevent individuals from using precious metals sales as an unreported source of income.
