COINS AND paying TAXES pls help..

ok I am looking to find out exactly what the law is on earned money from coins .. specifically money made from the presidential dollar coins , oin my case i bought a 1000 dollar case and found many smooth edge and want to know the law as far as taxes are concerned and if anyone has any information that would be helpfull , I would apreciate it very much ... are their any websites that i can go to or any good books ..basically as much info as possible on this subject is welcome and i am very greatfull to you all

 

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As far as I know, if it is short-term capital gains it is treated as ordinary income. If it is long-term capital gains then it is taxed at a reduced rate.

You really should ask your accountant or contact the IRS.

 

Hobby?

Hobo Is Correct On The Short Term And Long Term Gains. Now You Should Be Sure To Save All Receipts Of all] Expenses You Incur In Your Acquiring And Selling Of These Coins. I Mean Keep Meticulous Records!

now, I Assume We Are Talking Some Extaordinary Amounts Of Profit, So See That Accountant! And Be Sure And Ask How Far You Can Push The" Hobby "card.​

]

You Can "lose" Money For A Few Years In A Row Before The Irs Wants You To Become A Tax-paying Profitable Buisness.​

 

hobby card ????? sry guys guess you could say I am a bit of a newbie and havent heard of that term .. would being retired and over 65 have anything to do with this at all ?

 

I could be wrong but i could swear i had heard about certain us coins are taxed different ...has anyone ever heard of such a thing ....i cant remember exactly but it had something to do with certain us coins...if i'm wrong sorry

 

The Hobby term comes in with: Short Term Capital Gain.
(Higher rates).

If purchased as an investment-- then it would/could be long term, depending upon holding periods.

 

Short term, treated as ordinary income, long term taxed at 28%. Unlike many other long term capital gains which are taxed at a lower rate, long term capital gains on coins and collectibles are taxed at a flat 28% rate.

 

28%!!! That is ridiculous.

 

I asked my accountant a while back, because i was making a few dollars on ebay. He said if you make over six hundred something, it should be reported as income. He also said that if I didn't receive a w2, I probably didn't have to report the income.

 

I thought that when it comes to hobby, the proceeds from a sale could be used to buy other items for your hobby and therefore not be taxable.

 

That is a like kind exchange.
Not applicable for hobby gains.

 

Unless you're in the coin selling business in the sense you have an actual store fron, why would you even volounteer the fact that you made any profit in the first place? Why people WANT to pay taxes is beyond me. I pay enough with my primary employment. As far as the IRS is concerned, I buy and sell all my coins at face.
Guy~

 

I'm going to break my long-standing rule of not giving free legal advice. DO NOT CONFESS THE COMMISSION OF FEDERAL CRIMES IN WRITING IN A PUBLIC PLACE.

 

You may be thinking of the American Buffalo gold bullion coins. The IRS has ruled that the PROOF American Buffalos can be part of your IRA but the UNCIRCILATED version cannot.

Or perhaps you are thinking of sales tax. Depending on where you live, sales tax may or may not be applied to the purchase of regular collector coins but not bullion coins.

 

Kirk:
Okay, first, he probably said a Form 1099 (W-2 is for wages, as from a job, and includes withholding. All W-2's are reportable).
2) For 1099 Miscl. (which includes non-employee income) it will usually be issued by a company for $600 or more. In which instance you must file a Schedule C (business).
3) You can take deductions against that income (example: ebay fees, postage, mileage, etc.).

 

Actually, the IRS code stipulates that you can show a loss for two years, but then you must show a profit for three years, or they can declare the enterprise a hobby, and disallow you prior loees as 'hobby' losses.
To clarify: 'hobby losses' are not deductible.

 

Don't forget that if you used some of your profit to buy more coins the purchase price of those coins is an expense. You should only pay taxes on the profits that end up in your pocket, not used to buy more coins.

The above is my opinion only. You should consult an accountant for tax advice.

 

Hobo:
Sorry, but I disagree.

That is like taking a profit on Microsoft stock and then buying Ford.
You can't roll the profits from one item into another (ignoring the like-kind-exchange rules, which do not apply in this instance).


[Roy would be having a blast with this thread.]

 

Yes - through a certain company that's authorized by the US Government, you can put American Eagle coins in your IRA. You don't actually hold the coins though. You can google the company I'm pretty sure.

Also I think that sales tax doesn't apply to numismatic coin purchases but I'm not 100% on that. As for profit/loss, etc., check with an attorney.