Coins and Capital Gains Tax

Above, 2023 American Silver Eagle coin proof set. "Investors wanting to avoid reportable
 sales should buy American Eagles," says Fisher Precious Metals. Photo by Armand Vaquer.

Gold and silver as investments are long-term propositions. Don't expect to make huge profits from any sales of them in the short-term.

But, eventually one will decide to sell their coins or bullion, hopefully at a profit. However, that opens another can of worms: capital gains taxes. 

Sales of gold and silver coins are subject to capital gains taxes. But there are thresholds that are favorable to sellers, provided they aren't exceeded.

One of the big coin and bullion dealers, APMEX, has posted this on the subject of capital gains taxes on silver:

Individual taxpayers who sell silver for a profit may be obligated to report a capital gain when filing their return. This is true for most types of collectibles such as coins, stamps, antiques, and comics. When selling silver coins in consideration of reporting to the IRS, you must report the sales of any combination of 90 percent silver US coins with a face value of over $1000 and 0.9999 fine silver bars totaling over 1000 troy ounces. Other items like silver bars and collectibles, need to be reported if the sales result in a capital gain. If you experience a significant loss when you sell your silver, you may benefit from reporting the loss. 

According to Fisher Precious Metals:

Reportable Sales

Customer sales to dealers of certain precious metals exceeding specific quantities call for reporting to the IRS on 1099B forms. The 1099B forms are similar to other 1099 forms taxpayers commonly receive; the “B” means they have been issued by a business other than a financial entity.

Reportable sales (again, customer sales to dealers) apply to 1-oz Gold Maple Leafs, 1-oz Krugerrands, and 1-oz Mexican Onzas in quantities of twenty-five or more in one transaction. Reporting requirements do not apply to American Gold Eagles, no matter the quantities. Furthermore, reporting requirements do not apply to any fractional ounce gold coins.

Only one common silver product is reportable when sold: pre-1965 U.S. coins. The quantity that causes the filing of a 1099B, however, is not clear. The IRS bases its authority to require reporting on CFTC-approved contracts that call for the delivery of $10,000 face value. Consequently, many dealers do not report sales of pre-1965 U.S. coins unless the sale totals $10,000 face value; others report $1,000 sales.

Sales of American Silver Eagles, privately-minted Silver Eagles, and 100-oz silver bars are not reportable, no matter the quantity. Other precious metals products are reportable, but they are not covered here because the average investor does not trade them.

The best thing to do is to thoroughly check the IRS rules before making a sizable (over $1,000) sale. 

To read more, go here.

Silver Spot Price Over $25/toz

For the first time since I've been following the daily spot price of silver, it has gone over $25/toz.

From APMEX:

 

Ghana Silver Coins (Wait Until You See Them)

A few minutes ago, I received an email from coin dealer APMEX.

They were promoting silver coins from the nation of Ghana. 

Here's what they sent:

 

New Space Alien Release

Add intergalactic space alien and UFO-themed products to your collection! This selection includes the 2022 Ghana Alien release, which has a limited mintage of 25,000 1 oz silver, 5,000 antique silver, 1,500 rhodium plated, 1,500 silver proof, and 1,000 1/10 oz gold. Shop these space-themed products today! 

I wonder if a vendor will be selling these at the annual UFO Festival in Roswell, New Mexico this coming July? 

To order, go here.

1976-S 40% Silver Kennedy Half Dollar

Since we have a blizzard outside, I figured it is best to remain indoors today.

Yesterday, a package arrived containing the 1976-S 40% silver Kennedy Half Dollar graded as gem proof. As I mentioned in a post a week or so ago, this was the last coin the U.S. Mint minted in 40% silver. 

Of all of the coins minted to celebrate the nation's bicentennial, the 1976-S Kennedy Half Dollar was the only coin to contain silver. All the others were copper-clad minted. 

After I found this out, I looked around and found a good deal on this one through APMEX.

1976-S JFK Half Dollar Has 40% Silver

Some time ago, I read the following by the First Commemorative Mint:

The only coin that continued to be made in silver was the Kennedy Half Dollar which was made in 40% silver for circulation only in 1965, 1966, 1967, 1968, and 1969. All later coins were made only in copper-nickel.

The 1970 JFK Half Dollar was also minted in 40% silver. Only the 1964 Kennedy Half Dollar was minted in 90% silver.

Due to the above, I was surprised to learn the other day that the 1976-S Kennedy Half Dollar, celebrating the nation's bicentennial, was also minted in 40% silver.

According to Golden Eagle Coins:

1976 was the first year, since 1971, that the US Mint was authorized to use 40% silver in their coin again. The 1976-S Silver Kennedy Half Dollar is in brilliant uncirculated condition and contains 40% silver. 

After finding this out, I decided to order one from APMEX. These coins, which only came from the San Francisco Mint, are a bit rare due to its limited mint run of 11,000,000.

Modest Money: JM Bullion vs. APMEX

Finding a reputable dealer in gold and silver such as coins, bullion, bars, etc. is very important. I recently bought a couple coins from a front organization of Chinese counterfeiters. That experience told me the stick with reputable dealers that I know exclusively.

I use regularly several dealers and two of them are JM Bullion and APMEX. That is the topic of an article by Modest Money that compares the goods and services of each one. Which is better? 

Modest Money begins it with:

Physical gold is an alternative asset that many people wish to add to their portfolios. However, finding a reputable dealer locally isn’t an option for everyone, which is why many investors turn to an online gold dealer instead.

A respectable precious metal dealer offers much more than simple bullion. Many offer bars, coins, collectibles, and even gold IRAs! The exact offerings vary from dealer to dealer, which is why it’s important to do your research beforehand.

In this JM Bullion vs APMEX comparison, we’ll be taking a closer look at two well-known precious metals dealers. Comparing general pricing, services, storage options, and more, we’ll soon see which platform offers a superior service.

To read more, go here.

Top 10 Silver Coins For Investment

Above, 2022 American Silver Eagles. Photo by Armand Vaquer.

Since the U.S. dollar has been dropping like a stone in value (due to Bidenflation) and is not redeemable in gold, silver or any other commodity, people are looking to invest in precious metals.

At over $1,800/troy ounce, gold is not affordable to the average person. However, silver is affordable as a collectible or an investment as its current spot price is $24.31/troy ounce (as per JM Bullion).

As such, silver coins of .999 fine silver are popular. 

APMEX, a coin and bullion investment dealer, has an article on the top 10 silver coins for investment. 

They begin it with:

Silver coins are a great place to begin building an investment portfolio because they come in various finishes, from Brilliant Uncirculated (BU) to Proof, in a range of designs. Proof Silver coins are ideal for investors because they often contain the same Silver content and design as their bullion counterparts but are perfect for portfolios with high-quality, mirror-like finishes.

Investors typically choose Silver coins from sovereign mints due to their government backing and guaranteed Silver content. These sovereign Silver coins are generally annual releases with a set weight and Precious Metal content with every new release. There are numerous choices for investment-grade, sovereign mint Silver coins for investors to choose, which may appear overwhelming at first glance.

To improve your Silver buying experience, below is a current list of the best Silver top coins for investment. This is not a definitive list but is based on recognizability, liquidity, and the potential return on investment. These are the Silver investment pieces most attractive to investors.

To read more and see what they are, go here. 

Barber Quarters

 A few years ago, while I was still living in Tarzana, California, I found a Barber quarter on the sidewalk.

Since then, I've been curious about them.

According to the American Numismatic Association:

The Barber Quarter, also known as the Liberty Head Quarter, was minted between 1892 and 1916 and was preceded by the Seated Liberty Quarter and was succeeded by the Standing Liberty Quarter. These coins were designed by Charles E. Barber, hence the name Barber. The reason they are also known as the Liberty Head Quarter is because the head on the obverse is that of Lady Liberty. A common complaint about this coin is that many believe the portrait looks much more like a man than a woman. Many would be led to believe that is Mr. Liberty, but it is not. The coin weighs 6.25 grams and is composed of 90% silver and 10% copper.

Since I moved to New Mexico five years ago, the Barber quarter has disappeared. It has to be somewhere around the house. I just don't know where.

However, I bought three of them through APMEX (they were relatively cheap) and they arrived today. The dates received are 1907, 1908 and 1915. These are culled circulated coins. 

What is a cull coin?

From APMEX:

Any coin, regardless of its material or design, may be designated as cull if it is in poor condition. Any number of flaws, from cosmetic problems to structural defects, can justify this classification. Holes, scratches, pitting and bends are common among cull coins, as well as severe retooling, dark toning and even poorly performed repairs. By professional coin appraisal and grading standards, which consider a coin’s strike, preservation, luster, color and attractiveness, cull coins range from Fair to Basal State, or Poor.

Here's a couple of photos of them (with flash and without):

UPDATE (2/22/23):

While looking through a bag of Cuban CUC currency that was left over from my 2019 cruise to Havana, I found the 1892 Barber (or Liberty) quarter that had been missing mixed in with the Cuban coins. As it turns out, it is older than the three I bought from APMEX. Its condition is the same as the quarters APMEX sent. 1892 was the first year the Barber quarter was first minted. I put it in a coin capsule and put away with the other three Barber quarters.