When should I sell my silver

I think I will follow suit

 

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I think that the S & P rating warning was a political event, in that it seemed intended to push the legislature and the president into some hard decisions sooner than they want to do ( they would prefer to wait until after elections). I do not see how taxes can do anything but increase for the middle and lower class. I paid my roth conversion this year in one sum, not wanting to wait and see what taxes I would face in 2012 and 2013 if I accepted the ROTH "special" this year.

I think that even the experts would not touch the question of future taxes ( unless they figure they are never wrong ) so most are on their own. I expect that the 1099 subject on coins , etc. will also pass before long, even if it is resurrected within another bill beside the health plan proposal. SO if you plan to sell over $600, that might be kept in mind. I so support everyone paying all taxes due, so do not interpret as tax avoidance advice.

Jim

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How do you think they will determine the profit on PMs? Not everyone has records on what they paid for their physical metals.

 

I sort of invert the observation. It may be possible that the legislature and president already decided on some course of action that has not been made public, and the S&P announcement was made to give them political cover for the actions that will be announced later.

 

Absent records, I think they will tax the entire proceeds.

 

This is the case. If the IRS can prove you sold something, the burden of proof to minimize taxes due, (including purchase price), it on the taxpayer. Basically the entire sale is taxable until you can prove your expenses.

 

If they are really generous and feel they don't want to totally rape you, the IRS could give you a default cost. Perhaps the lowest price Silver sold for, lets say, in the last 25 years? It would be like a standard deduction for cost or you would have to fill out a different form to prove otherwise.

 

How long is one liable ? How many years? Also what is the lowest capital gains rate. Better stated, If one earns fifteen thousand a year?

 

The lowest rate would be zero, but 15k a year I believe you are in the 10% cap gains rate, depending on your circumstances.

If the IRS ever gave you the lowest silver price in the last 25 years consider it a gift, and you had better not tell anyone for fear of getting that agent fired. The reason is: What if these were gifts or you just found them? You have no proof you actually paid anything for them, so this is the baseline the IRS has to go off of, that you got the item for free so all is profit unless proved otherwise.

 

Sell it before the bubble bursts! When will that be? Who knows. Personally i have been selling because i have no problem getting 4x-5x what i payed. For me its a good opportunity to buy REAL coins. I would rather have 1 nice collector coin than 20 common silver halves. Quality over quantity.

 

I'm not a tax preparer, but I thought that if you were in one of the two lowest tax brackets, your capital gains tax rate was zero. But since the sale of silver in any form will be considered a collectible, you may still have to pay the 28% tax rate on collectibles.

 

Good idea. I have a question. Does anyone see the numismatic market moving up lately? This is what happened in the late 70's, as dealers got cash from PM they reinvested in numismatic stock and prices rose. This would be the only danger I see to your logic.

Myself? I think I will start lightening my position some, and move the money into some more international or international exposure stocks. Either that or a recession resistant US stock with high dividends. If silver ever goes back down to a level that I feel is in line with historical pricing, (say $15-$18 an ounce), I will simply buy back twice as much. My problem is that I have a lot of silver in like SL quarters, barbers, better (vf-AU) Walkers, a couple full sets of Roosies, etc. Should I expect a premium at these levels, or is all of this stuff just junk? The SL and barbers are g-vf.

 

Myself, I make the case on returns that they are investments and not collectibles. I am a CPA so if the IRS ever challenged me on that, (bar or junk silver), I would see them in tax court. Yes, coins are colelctibles, but I feel there is enough case law to say that selling PM's at their metal value is an investment. Your tax preparer may not agree, but that is what I do.

Great point Cloud, sorry I just answered as if they were investment items like stocks, which to me PM bullion is. If you sell for a premium over bullion, though, then you could be in trouble if not paying as a collectible.

 

Is it correct that the two lowest tax brackets do not pay capital gains tax?

 

Yeah, sorry I was thinking of what it is scheduled to be next year. That's the problem with taxes you are always looking forward and backwards. For this year the rate is zero for the lowest two brackets.

 

Excellent idea I've been doing that for almost a year now, moving back into numismatic coins... in my collecting field, it seems that a good portion of people are distracted by the price of silver and are missing out on the numismatic stuff that is selling at below what it should be.

 

So some folks here may have the chance to sell tax free [but still has to be reported]. It's something to keep an eye on.

 

Thanks you guys. I am in the lowest bracket. Had no capital gains to claim in 2010 but this year I'll be huge, $40K+. I do my own taxes so I'll have to be really up on the IRS code. I'll be inquiring next year. Er, the IRS doesn't make auction houses withhold taxes like casinos do they, I think not.

 

I am sorry this might sound the wrong way, but some people's answer might vary from another, due mainly by the amount of silver they hold. A decision on 10 ounces total might be different if the person instead had 1000+ oz. A loss of $20 an ounce on the first holding would be $200, a loss of even $2 an ounce in the second would be $2,000. There is a reason to determine what your risk/reward ratio is when determining when to sell. Every one probably is different in the amount of PM they hold. I wouldn't expect many to say how much they have, but their answer might be entirely unsuitable for your determination. IMO.

Jim

 

i have just recently read an article that suggested that when the price per oz of silver equals or passes the price per barrel of oil which is one hudred some odd dollars, then you should thik
about selling your silver and reivesting in other safer commodities i.e. gold but the problem with that is that gold is movig up quickly i price also.