If i bought a roll of ASE at say $20 a piece so $400 a roll and after 10yrs they go up to $30 each or $500 a roll do i need to report profit to goverment? Whats the taxe rate? How would the goverment know what i paid for them? Do i pay on all $500? Is it better to sell coins such as these in rolls of 20 or per coin.
My understanding is that the $100 profit in your example is taxable at the 28% rate on collectibles. This might change ten years from now. You need to keep your receipts for the purchase price to establish your cost basis, otherwise the entire $500 might be deemed taxable. Right now, I don't know of any way the government would know that you sold such a small number of coins. However, ten years from now it seems likely that all such transactions will be recorded and reported, so keep good records so you can comply with the tax law.
On the other hand, if you buy your silver at $17 and sell it at $16 to pay for your little nephews braces, you haven't made any profit and you don't owe any taxes. Despite that obvious fact, sales over a certain amount can nonetheless trigger reporting, sometimes depending on the type of coin. If you scroll down this page, and then scroll down some more you will find some information about what kinds of sales are reportable, and what kind are not. http://www.cmi-gold-silver.com/gold-confiscation-1933.html
What will occur sooner is collection of use tax by states. If your state has a legislated sales tax, you are expected to declare out of state purchases ( including internet, such as ebay, amazon, etc.) and pay the state tax due on such unless you have a resale license, which raises a similar flag. Internet sellers only have to collect from states they have a physical presence in, such as Heritage now, must collect taxes from California as well as Texas. Only if your state does not have a state sales tax are you exempt. Only if you buy your bullion for cash with a false name and no ID shown, can you expect to never have trouble in the future. Eventually, when the states figure out how much they could be getting, They will get info from ebay, etc. on sales, and ID or bank account from paypal and you will have to declare it or face problems. No-Name http://www.associatedcontent.com/article/1342340/when_do_you_have_to_pay_sales_tax_on.html?cat=46
I have often wondered about the 1st tax situation mentioned. 20 Silver Eagles which cost $400.00 are sold for $600.00. Is the taxable gain $200.00 or $180.00 ? The twenty coins do have a stated legal tender value of $20.00. In other words if you sell them for $600.00 - have you really only sold them for $580.00 - being that you are also transferring $20.00 worth of legal tender in the exchange?
Just make sure your records always indicate a loss. No government on earth can track every sale and purchase of every citizen,and there's no way they'll ever try. But to be safe, I never plan on selling my coins so they'll just have to find someone else to make an example of. Guy~
Honestly, I have never sold any of my coins in my collection, and don't plan on it. I can let that to my family, when I'm six feet under. But seriously, how many times have you recieved a reciept at a coin show when you didn't ask for one? I don't think half of the coin purchases at shows are reported as income.
Older purchases Coins that were purchased a long time ago are gone for all intensive purposes. As long as a personal trading market exists , it will be difficult to track coins, hell they can not even find people. Purchase but do not sell if you do not have to. By the time you might have to there will be no one to track coins. They can not track money the cartels weigh it and send it to be laundered by the pallet. Probably in a Military plane, or through an embassy in a soft hearted country. Winding your personal moral clock does little good. They count on many older and younger people to tell all. Pep
