Are the coins raw, in slabs, or both? That's the biggest question I have. I'd take the collection to a LCS to get evaluated. I would consider selling the common stuff to the LCS. If there are raw higher valued coins I'd consider sending them to PCGS or NGC first and the send them to GC. I did this years ago when helping a friend sell the collection she inherited from her late mother.
If someones going to sell through GC its SIGNIFICANTLY cheaper to get them graded through GC than doing it on your own and then sending them in. It saves you shipping charges and they can get express service for cheaper than regular service is for normal submitters
My father left my brother and I a bunch of "junk" coins. Some are nice but not worth much more than the silver content. Having said that, my interest in coin collection got me to do some investing in some coins and others for fun. Having been and accountant for many years, I worked for the state and had little to do with taxes other than my wife's and my tax returns. Ever since I started collecting coins, I have kept a detail list of each of my purchases. My expenditures for gold has been about $30,000, for which my son will inherit, including my American Silver Eagles. I'll let him deal with the taxes.
What if the majority are high-end graded commemoratives which were bought at and around the peak prices before they tanked? There are extensive spreadsheets of dates purchased, prices, from whom, and places. Say he breaks even due to the price drops, would he still owe taxes on $500k even if hypothetically there are no gains, which could be proven through purchase records?
This is a very generalized explanation and there may be some rare or unusual exceptions but I think it's a pretty universal explanation for how things work most often. Consult your tax advisor! For the purposes of calculating the capital gain and the subsequent capital gains tax owed, it doesn't matter what the coins are or when they were purchased. This also covers PMs but note that with PMs there are some exceptions and special rules that don't exist with collectables. Here's what matters: Original purchase price of coin, also called the "Basis Cost". The sale price of the coin, also called "Realised Price". Subtract the "Basis Cost" from the "Realized Price" and the difference is the Capital Gain. If the Capital Gain is a positive number, multiply the Capital Gain by 0.28 (28%) and that is the Capital Gains Tax owed. If the Capital Gain is a negative number or zero, then there is no Capital Gain and the Capital Gains Tax owed is zero. Note that this is a calculation performed for each individual coin, not for the collection in toto. Now, if you have dated receipts for the original purchase, then those are pretty much irrefutable evidence to support your claim for the validity of the "Basis Cost". If you don't have the original receipts but have a record-keeping log of the purchase (who, when and how much), that is better than nothing but clearly not as credible as original receipts. If you don't have receipts or a log, then you are pretty much at the mercy of the IRS in the sense of how willing they are to accept general market evidence of the coin's value from the time when it was purchased. IRS would also have to accept your word of the date of purchase which is another hurdle. In the worst case from the taxpayer's standpoint is when the IRS says your basis cost is the coin's value when you sold it. In that worst-case scenario, your calculated Capital Gains would 100% of your sales price. The above only describes the case where the coin's original purchaser (or the purchaser's joint property partner) is selling the coins. If the coins are inherited, then they should be placed into the probated estate and an estimate of their value provided by a recognized authority. This new value then becomes the new "Basis", replacing the original purchase price. This is particularly desirable when there are no original purchase price receipts. If you don't probate them and establish this new "Basis", you open yourself up to potential problems. I don't know how it is in other states, but in Florida you will pay 3% of the probated property value in fees to the probate attorney. That is a cost of doing business but folks that think they are pulling a fast one without knowing what they are doing can sometimes get a nasty surprise down the line.
A trusted numismatist, CPA/PA, a trusted banker, or legal advisor. Does your father have an inventory of items, very important?
And your question is why I said you need to speak to a tax attorney. Think about it, by the time you pay the auction fees, the cost of the item, getting the items to the auctioneer and paying the taxes on the sale, it may be better from a financial point of view to keep them.
You would still be at a positive for money than keeping them. One of the only ways that would be true is if they knocked you into a higher tax bracket that you were right on the line for. There's enough value there where of course the bracket will go up but they certainly wont be losing money on the sales.
Not true. If the owner of the coins (not an heir) sells his coins, the proceeds are taxed as capital gains, not ordinary income. The capital gains are not added to ordinary income that would push him up to a higher tax bracket. If @BlackberryPie's father needs to sell his collection to fund current expenses, then he will be on the hook for the capital gains. But if he can avoid selling now and leave his collection to his heirs, then they will get the benefit of the step-up in Basis Value. If he's got a collection worth half a mill, then he should probably be working with an estate and investment planner anyway.
I think you missed his last thread in which he says “...were bought at and around the peak prices before they tanked?”.
It is true that from a financial standpoint there's basically no situation where he is better off keeping an item of unrealized value over the sale. Taxes arent going to cost him money on the sale. Now if he was planning to leave them to his kids yes maybe, but you wouldnt really be looking to sell if that was the case.
I saw that. The moneys already lost at that point. Holding onto them forever isnt going to change that. If they sell they will have more money then before the sale. There's obviously reasons they're looking to sell. If they really are top tier ones (I think I saw one post about toning) they may not be as bad off as they thing and Legend could be a good place to check that does very well for toners. Either way a sale wont cost them money where they have to write a check because of it
go with great collections, they do not charge 29.00 min. on any lot, so you have a coin worth 30.00 you are only going to get maybe 1.00 for it since the buyer fee is too high, at grreat collection min is 5.00 and then 10 or 12% DEOPENDING ON HOW YOU PAY, I PAY MOre WHEN I AM BUYING SO THE VENDOT (AND THUS YOU) GET MORE, SO, MY THOUGH ANYWAY, THAT 29.00 MIN FEE IS A KILLER OF CONSIGNEE MONEY, UNLESSS a 50k item, lol
wow funny, my company and me Da's was charter oak, we both used same cards they just said "charter oak" in advertising (back when you could still sell in magazines and listings) was charter oak coins and also his was charter oak stamps..but hey that was 45 years ago..
i believe they will slab em for ya, and that way no out of pocket expens..also they must get a horrific discount because they probably send 1k or more slabs d in a month?? right?
He said collection. Guessing not junk. 500k of junk. Is that per say what CT considered collecting. That a honest question form Cheech