Taxes when you sell Junk Silver?

I bet technically you do.

 

Log in or Sign up to hide this ad.

The IRS only interprets and enforces the tax laws that those very politicians write and pass. The IRS is many times more citizen-friendly than it was 20 years ago. A flat tax sounds intriguing, but once the basics ( the part for all of us commoners ) are written the lawmakers will add all of the exceptions that are for them and their influential supporters, IMO. I hope they don't start messing with the tax laws, just enforce the ones they have fairly.
Jim
​

 

I don't like the Exceptions. We speak of equality of all but then legislate inequalities into to all that our country does.

Make a flat, fair or sales tax's and make it the same for everyone. No exceptions!!! (poor, rich, old, young, black, white, republican, democrat, for profit, not for profit, for business, for leisure...

There will be no April 15th to worry about, no accountants to waste your time and money, no worrying if you put in the right deductions or not and waiting for a return on the money you over paid.
Why do we put ourselves thru this?

 

Ihave no problem with a flat tax, but wonder just how it would be fairly implemented > Would othe taxes like property tax be eliminated and how about registration fees, licenses, etc. It is a very complex issue. And each solution I have read about leaves a lot of questions. Even if we use just a VAT, will food items be included, or books, educational materials, etc.

At least here in Nevada there is no state income tax......

 

Nope unfortunately the hundreds of other tax's would stay.

It would just get rid of the Federal Income Tax Code and most of the IRS.
I agree the devil is in the details. The most organized is the "Fair Tax" which has quite a few supporters now a days. It is basically a sales tax only with the first few thousand in expenses getting to be tax free so the "poor" don't have to pay that. But everything else get's taxed at I think 27% is the mark. I think the idea is also to have the tax included in the price like a drink at a bar or a movie ticket. At first you'd notice the higher prices but your check sure would be bigger.

What I really like about it is that it promotes SAVINGS...yep we might actually become a country that saves again....

 

Well..... The advantage of junk silver is that these 1099 rules won't apply as it is easy enough to sell less than $600 of it at a time. This isn't a statement on the tax owed, if any, but rather on how this rule might hit this type of PM.

 

Fatima - I believe the $600 is aggregate. So, you can't go in to the same dealer and buy $599 of stuff every week. Once an individual customer spends $600 they have to report it. What a nightmare for all small business owners. The amount of paperwork is going to be ridiculous. All the power and all the money is shifting from the private to the public sector....and we all know how that works out historically.

 

Tommybee - Coin dealers do not have to report 1099 information for money spent by customers in their store. It only applies for money paid to customers in transactions where the dealer is the buyer and the customer is the seller.

 

I already established FIFO as my accounting basis for metals. Ouch. Some of my earliest silver purchases were for a few dollars an ounce. If you haven't established a basis yet, do the math and see if LIFO isn't cheaper.

FIFO - First in, first out. You sell the first things you buy.

LIFO - Last in, first out. You sell the last things you buy.

 

Farmer - are you sure about that? Thanks.

 

The tax is on the PROFITS, not the gross sales price. Therefore, you'd still have 72% left.

Obama has NOTHING to do with this, the 16th amendment to the constitution was the cause of income taxes, not the current administration. It was ratified February 3, 1913. I don't believe that the current President was born yet.

AGREED!

 

Yes tommybee i am sure. 1099 are informational returns reported for payments not payments received.

 

My wife and I were married in December 1977 and went into business for ourselves the following April. Filing long and having both 1099 and 1040 and other forms of income is normal for us. It might not be for you.

Being a hobbyist, rather than a professional, has tax advantages and tax disadvantages, as does everything else in life.

As the chair of the Michigan State Numismatic Society educational forum for several years, I brought in a guest speaker from H & R Block. (Her hobby was show dogs.) If you want tax advice, go to a professional.

 

If you buy or sell more than $600 of anything, a 1099 will be generated by the person who pays for the goods or services. If you buy more than $600 in coins, this means you.

But don't take my word for it.

From the actual law itself. PUBLIC LAW 111–148—MAR. 23, 2010 124 STAT. 119; Public Law 111–148 111th Congress; An Act Entitled "The Patient Protection and Affordable Care Act." (
Link to all 900+ pages PDF here.
I started with the Library of Congress's Thomas site you need to know about if you do not already, entered the Public Law number and followed the link to the Government Printing Office.)

Section 6041 of the IRS code mandates the issuance of a 1099 for wages. I get several every year. If I sell more than $600 of articles to any one publisher, they send me a 1099. If I sell less, that all gets itemized and entered under "Other Income not Reported." Now the new law 2012, includes all goods and services, not just wages.


This is the IRS Code. (I googled IRS Code. Went to the IRS website and the followed the link to the contractor, Cornell University, which provided the text in PDF.)
TITLE 26 > Subtitle F > CHAPTER 61 > Subchapter A > PART III > Subpart B > § 6041.
It is right at the top, section a:

If you buy or sell more than $600 of anything, a 1099 will be generated by the person who pays for the goods or services. If you buy more than $600 in coins, this means you.

 

Money spent by customers is reported as sales income. How can the dealer send himself a 1099 ? lol
This is data that is already kept by sellers or is supposed to be, anyway. When a dealer purchases items from individuals, they need to record the sale and verify the ownership by identifying that person. That protects them from buying stolen items and possibly losing them to the police and allows them to properly list the expense for them. As we've seen throughout the thread, it's the dealer's responsibility to establish his cost. To do that, he must be able to verify the source as well as the amount of the purchase.

All business is required to keep records of transactions. Both purchases and sales. There really isn't much additional paperwork involved, except for the mailing of the 1099's. Of course, if items are purchased from another business rather than an individual, I do not think the forms are necessary ? But that may have been changed since I retired.

 

Oh come on - 1099s are required only for payments made in the course of conducting a trade or business. An individual will not have to complete a 1099 when buying a flat screen TV from Best Buy, a set of All Clad pots and pans from Macy's, eating lunch at McDonalds every working day throughout the year, placing a $600.00 bet at Churchill Downs or buying $600.00 worth of coins or bullion from their local coin shop.

 

Obviously, it changed since you retired. The existence of a new law to take effect in 2012 would be evidence of that.

If you buy $600 in coins, you have to create a 1099.
You send one copy to the seller and another copy to the IRS.

Stolen goods has nothing to do with it. You think that an individual across a counter is less likely to have clear title to the goods, but that is flat out not true. It is accepted (perhaps not well attested, I confess) by law enforcement professionals that 20% of the goods sold lack clear title. That includes the new-in-the-box Nikes at a flea market. It includes a railroad boxcar of semi-finished components going to a Fortune 500 manufacturer.

We record the details of identity as a commercial folkway. In an earlier day, the merchant's daily journal was simpler, admittedly, but everything else was, too. Yesterday, I went to Panda Express for lunch. The receipt has the seller's name, address, and telephone number.... and website URL....

 

OK.

... ummm... just a question... when you go to a coin show, how do you tell the businesses from the ordinary people?