bedraggled wrote:Jack, Ocho, etc all,
Are there gold funds that avoid the collectibles tax? I believe PHYS is one but that will go to Sprott soon.
Yes, Jack, buying for cash may be the best idea.
SGOL is strongly touted. Should I just disregard the collectibles tax. More thoughts,please. (And I am having trouble spelling "collectible" or does it end "able"? I can't go to dictionary.com on this iPad).
You "disregard" Federal taxes at your own legal peril. Everyone makes their own decisions in life, but tax evasion I would never recommend.
Why is SGOL better than IAU or GLD? It's more expensive. Who is "touting" it to you? What's their agenda? Yes, it trades commission free at Schwab. That's nice.
When you backtest the three, IAU comes out best; it has the lowest expense ratio. I don't know anything about PHYS. Any ETF that holds gold bullion will have the same taxation issue.
You can avoid collectibles taxation if you buy gold miners, like the GDX ETF, but GDX is very volatile and sometimes doesn't act the same as gold. They are 85% correlated, not 100%. But you still have capital gains taxes, of course. And dividends are taxed. And you have to be a sly fox to trade GDX.
I have traded GDX and have never lost money on it, knock on wood, but it made me sweat.Honestly, unless you want to study and work to optimize your taxes, just buy IAU and put it into your IRA, and forget about the stupid collectibles tax. You're going to get yourself into legal problems, and those will cost more than you can imagine. I got audited, and it cost me thousands to clear my name. I was right, but I was out thousands.