I have a hypothetical tax-related question relating to selling gold bullion coins. I've been buying them for years, but I've never had to sell one. If any of you has sold bullion coins before, maybe you can help answer my question.
Let's assume someone kept detailed records and receipts of all of his bullion coin purchases over the years, but somehow they were all lost or destroyed--perhaps in a flood or fire. Let's say the coins survived, but the records and receipts didn't.
Now let's assume this person needs to sell some or all of his bullion coins for living expenses or an emergency. When tax time comes, what does he report as the cost basis of the coin(s) on his tax return?
If the answer is that he's supposed to base the cost basis on his best guess for each coin's purchase date, what if that's simply too hard for him to do accurately since his bullion coin purchases were spread out fairly randomly over, say, 30 or more years?
Luckily this isn't my situation; I still have all my purchase receipts. I'm just curious. The mind-bending complications in tax laws are morbidly fascinating to me sometimes.
Selling Gold Bullion Coins
Moderator: Global Moderator
Re: Selling Gold Bullion Coins
I believe in 2012 the IRS is going to start tracking gold purchases over $600. They just want to make sure they get their tax money, but it might be a remedy to your proposed problem.
Perhaps we will be able to contact the IRS for our cost basis?
Perhaps we will be able to contact the IRS for our cost basis?
everything comes from somewhere and everything goes somewhere
Re: Selling Gold Bullion Coins
I imagine that the IRS would say that if you don't have documentation to substantiate your cost basis in the property, then presumptively the proceeds from the sale are all taxable income.
That would be my guess.
That would be my guess.
Q: “Do you have funny shaped balloons?”
A: “Not unless round is funny.”
A: “Not unless round is funny.”
Re: Selling Gold Bullion Coins
A now-obsolete 1099 reporting requirement was initially passed for $600+ purchases, buried deep within the bowels of Obamacare. Small businesses and coin dealers throughout the country had a collective aneurysm when this was discovered.melveyr wrote: I believe in 2012 the IRS is going to start tracking gold purchases over $600. They just want to make sure they get their tax money, but it might be a remedy to your proposed problem.
Fortunately, Congress came to its senses and later got rid of this provision: http://www.coinnews.net/2011/02/07/sena ... equirement