Are Gold and Silver Coins Taxable?

Investment in precious metals provides market participants with a sound way to diversify beyond volatile stocks, low-interest bonds and GICs. But are such investments tax deductible?

Under federal tax laws, dealers must report any sales involving significant cash payments of $10k or more.


Precious metals offer investors a safe and sound way to diversify their portfolio and protect themselves from inflation, economic turmoil and financial crises. But before purchasing bullion coins it’s essential that investors understand how these investments are taxed so that they can make informed investment decisions.

Gold and silver bullion purchases in the United States generally do not owe taxes; however, in certain situations the federal government and IRS require dealers selling precious metals significant cash payments as they sell precious metals; this allows them to keep track of significant sales to combat money laundering activities.

Typically, non-collectible precious metal purchases don’t fall under sales taxes because they’re purchased at market price for their pure metal content. We strongly suggest our customers consider American Silver Eagles or any other government issued coins that contain face values since these purchases will generally not incur sales taxes.

Investors seeking to avoid sales tax on silver may also choose “junk silver.” This term refers to old circulation coins minted prior to specific dates that contain real silver; however, these coins do not qualify for GST/HST/HSM/VAT exemption as they don’t meet the purity threshold required to be free of sales taxes in most countries.

No matter the exemptions listed above, precious metals purchased at market prices for their numismatic values will still be subject to tax as collectibles. Gains on collectibles held for one year or less will be taxed at 28%; significantly higher than the 15% long-term capital gains (LTCG) rate that applies to most other assets and taxpayers. Therefore it’s crucial that careful records of precious metal transactions be kept and consultation with a tax specialist taken prior to selling or disposing of investments in any form.


Taxing precious metals such as gold and silver coins depends on the laws in your state. Some charge sales tax when purchasing precious metals while others don’t; regardless, you will need to report any profits you make when selling as capital gains when reporting sales profits.

Avoid capital gains taxes with the sale of coins if you use their proceeds to buy another asset of equal value, such as real estate or stocks and bonds – this process is known as 1031 exchange. But be sure to consult a certified public accountant or tax specialist first!

Some dealers may claim that gold purchases made without reporting are exempt or that arrangements have been made with the IRS to avoid it, however this claim can be misleading and put investors at risk. According to government rules, no precious metal purchases made cash surpassing $10,000 must be reported and filed as form 1099B with the IRS by their dealer.

Junk silver (old circulation coinage using real silver) falls under the same rules as other precious metals, and investors and collectors who purchase junk silver as investments should be aware that sales taxes may apply, unless it meets a purity threshold of 99.9%.

Physical gold and silver investments provide a great way to diversify your portfolio and hedge against inflation, but their biggest benefit lies in having no counterparty risk compared with paper assets which may become worthless over time. Gold and silver have never experienced zero value since their founding over 3,000 years ago, providing you with a safe haven for your savings. For more information about why owning precious metals might benefit you visit our Gold & Silver Education Center.

Raymond Banks Administrator
Raymond Banks is a published author in the commodity world. He has written extensively about gold and silver investments, and his work has been featured in some of the most respected financial journals in the industry. Raymond\\\'s expertise in the commodities market is highly sought-after, and he regularly delivers presentations on behalf of various investment firms. He is also a regular guest on financial news programmes, where he offers his expert insights into the latest commodity trends.

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