Unfortunately, the IRS has ruled that precious metal ETFs organized as grantor trusts are taxed the same as collectibles. As such, long-term capital gains from selling these ETF shares are subject to a maximum individual federal income tax rate of 28% instead of the standard 20% maximum rate. (Source: IRS Private Letter Rulings 200732026 and 200732027.) Finally, be aware that the dreaded 3.8% net investment income tax can also apply to gains from selling ETF shares. That can raise the maximum effective federal rate on long-term gains from precious metal ETFs to 31.8% (28% + 3.8%) for higher-income folks.
The article has information regarding other types of ETFs as well.
Right, which is another reason not to use gold ETFs. They have terrible tax treatment.
CEF and GTU, on the other hand, may be taxed according to normal capital gains treatment.
The reason I said may is that it's very hard to pin the IRS down on such things, but that is my understanding.
Note: I'm not a tax expert, consult your own tax expert, etc.
