The tax laws on selling silver.

I'm sorry if the applicable explanation of a sales tax event went over your low-lying head!

I'll explain in a slowly-typed answer. Any amount of funds transferred between individuals may indicate a taxable sale, requiring sales tax payment, which appeared to cause your confusion when asking about a receipt.

I just cited a law dictating sales tax due, regardless of funds amount exchanged!

SORRY, I'm accustomed to dealing with German Shepherds!!

 

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You blabbed about interest, not tax, which is when I lost interest. - Edited -

 

Thanks for the appropriate respectful corrective response!

 

A barter exchange is a marketplace like fleaBay. Not the transaction.

 

Okay, my bad then. I was thinking "barter exchange" meant an activity, not a venue.

Nonetheless, whether your profit was in dollars, coins, or ounces of metal, the IRS wants its take. In dollars.

 

https://www.law.cornell.edu/definit...:subchapter:A:part:III:subpart:B:section:6045

 

(3) Barter exchange The term “barter exchange” means any organization of members providing property or services who jointly contract to trade or barter such property or services.
So peer to peer wouldn't be construed as an organization?

 

It looks like I'll have to declare the gain on the silver if I use it in trade. Don't think I have a legal way around it. Thanks for all the information.

 

Will the person you would be trading with declare a gain?
Remember no one makes a profit on PM's...it's written in stone someplace

 

Maybe in the same gravel those folks were reading when they tried to skip taxes by paying people in silver coin, and reporting it as a face-value transaction. The IRS shut that right down, although I'm still a little puzzled that it's not legal. To my mind, the legal approach would have been for the IRS to demand their payment in silver coin as well.

My mind is not a legal one, if anyone needed reminding.

 

It's funny I can trade a house for a like house but that won't work with silver. I love the tax laws.

 

If the home you're selling/trading/exchanging was your principal residence for two of the previous five years, you can actually sell it and take the capital gains tax free, up to $250k for singles and $500k for married couples. And until the tax laws change, you can do this once every two years.

So you don't have to trade for a 'like house' as you mentioned. You can take the proceeds and do whatever you'd like with them.

This is one of the very few true benefits we receive from the IRS tax laws that go in our favor.

 

Look up in the thread above, I explained that, tax law change in 2017. But if anyone thinks the IRS has anyone smart enough to track all of this without any 1099s being issued to cross reference, I have some beach front property to sell you in the Sahara Desert. Have any of you dealt with them on the phone? Forensic accountants, they are NOT!

Old Chinese proverb.......both cash and coin are king.

 

My proverb is "The less you own, the less they can take away".

 

Thank you for your factual post.

Here is a BRIEF partial description of the EXCHANGE process:

"Tax-Advantaged Solution



A tax law provision known as a Section 1031 Exchange allows a real estate owner who holds property for business or investment purposes to exchange their property for other “Like-Kind” property and defer paying any tax on the Exchange.



The use of the word “Exchange” is somewhat confusing. In most 1031 Exchange transactions, it is actually a sale of your property followed at a later date by your purchase of another property. You can Exchange (sell) any investment or business real estate and Exchange (purchase) any other type of business or investment real estate.



An example would be timberland property exchanged for some type of income producing rental property such as a multi-family apartment complex, a self-storage property, or even a mineral royalty interest, etc. These properties could be acquired and professionally managed inside a Delaware Statutory Trust (DST).



The DST is created by billion-dollar real estate sponsors and management companies. A DST permits fractional ownership where multiple investors can share ownership in a single property or a portfolio of properties, which qualifies as replacement property as part of an investor’s 1031 Exchange transaction. A major advantage of purchasing a DST interest is there are no management responsibilities for the investor.



Exchange Process Utilizing


DST Replacement Property



1. Exchanger (Owner) sells his property, known as the “Relinquished Property,” and proceeds are escrowed with a Qualified Intermediary (QI).



2. QI, through a written agreement with the Investor, transfers funds for the purchase of the “Replacement Property.”



3. Exchanger (Owner) receives a beneficial fractional interest in a DST. The DST Owner will begin to receive monthly income from the DST and will receive his or her share of the sales proceeds when the property is sold in the future.



A Qualified Intermediary is an independent third party, institutional entity, that facilitates Section 1031 Tax Deferred Exchanges. The QI receives and holds the proceeds from the sale of the Relinquished Property in a Trust or Escrow Account to ensure the Exchanger (owner) never has actual or constructive receipt of the sales proceeds which would trigger capital gains consequences."

 

I apologize for the irritating confusion I generated when discussing a taxable exchange between 2 humans!

Here is a believed legal description of the process when excess funds are transferred, possibly called "interest":

"Interest is the charge for the use of borrowed money and generally may be subject to a TAX.
In most cases you will earn interest if you let others use your money.
Your money earns interest when it is lent to another person or business.

Interest is considered unearned income because money, not a person, is working to earn the income."

SORRY FOR MY APPROACH OF INTERACTING WITH A CREATURE THAT NORMALLY COULD NOT HUMANLY POST ON THIS SITE!

I stooped to the level of that creature, as I often do with my German Shepherds, who have me "well-trained".

A 150# pitch black German Shepherd canine can do whatever they wish!

My approach was improper!!

 

Yes, I understand. That is a cool law that helped a lot of folks.

I should have said, I can trade a rental property for a like rental property. I have helped others do this but have not found a deal that worked for me. Not much in my area to pick from. The few I found were trashed and needed a lot of work. I already have 1 or 2 remodels going on most of the time.

 

Another old proverb, of course, is "do not talk about Fight Club".

 

Please see ABOVE Post #35 Legal explanation of the Sell/Buy/Tax for Tangible "like-kind" property.

 

Yes. That's the way I understand it. I don't remember how the depreciation thing works.