When it is necessary to report a purchase of gold, the dealer will be the one to report it. Form 8300 requires information about the gold purchaser, including name, social security number, address, and license number. As explained in the “Reportable Purchases” section, purchases of precious metals are not declared unless the cash reporting thresholds are exceeded. Investors who want to avoid reportable sales should buy American Eagles.
Don't fund your precious metals IRA with fractionated gold or silver, as they are also unnecessarily expensive. To prevent the government from finding out about their investments in precious metals, many investors are happy to know that their purchases will not be declared and they will end up buying overvalued currencies. There is a lot of contradictory and inaccurate tax information on the Internet about taxes on gold and silver. However, no government regulations require notification of purchases of precious metals themselves.
First, if you receive the metals as a gift, the cost basis is equal to the market value of the metals on the date the donor purchased them. That's why it's important to check with your certified public accountant about taxes on your investments in gold. However, no personal reports are required when the metals are purchased and not while the metal remains your property. Reportable sales (again, customer sales to dealers) apply to 1-ounce Gold Maple Leafs, 1-ounce Krugerrands, and 1-ounce Mexican ounce in quantities of twenty-five or more in a single transaction.
The following describes how these investments are taxed, as well as their tax reporting requirements, cost base calculations, and ways to offset any tax liability resulting from the sale of physical gold or silver. One of the many advantages of owning physical gold and silver is that they can be private and confidential. Americans once walked down the street with the clink of gold and silver in their pockets and didn't think about it. Gold and silver bars may attract unwanted attention or require special statements for monetary instruments, but a gold necklace is, well, just another gold necklace.
As for the second special scenario, if you inherit gold or silver, the cost basis is equal to the market value on the date of death of the person from whom you inherited the metals.