Do You Have A Problem With the Government Taxing Gains on PMs?

[Hatha Sunahara]

Well, I sure do. When you buy gold and sell it at a higher price, according to the government, you make a gain that is taxable. But is it really a gain, or is it compensation for the deteriorating value of their fiat currency?

My conclusion is that taxing 'gains' on PMs is outright theft by the government. It transcends the idea of a 'tax'.


Hatha

[cortez]

what gold?

[solid]

Hatha, we all lost it in boating accidents....accidents. :)

Yes, tax is theft by our own gov..this is why we have accidents. The sinking of PM's is easier to accept than the greedy hands of our own gov. Kinda sad actually...

[Ponce]

You mean to say that they are going to tax my silver dime?........uffffffffffff the shame of it all.........shhhhhhhhhh don't tell them but I have two of them heheehehehehehehehe.

[ximmy]

red tape
I can see can't you see?
red tape
do in to you do in to me
red tape
bureaucrasie & bourgeoisie
red tape
killing you killing me

tax this
tax that
tax this
taxthat

no more red tape


http://www.youtube.com/watch?v=iExJ2Jtlnlo

[1970 silver art]

Hatha, we all lost it in boating accidents....accidents. :)

Yes, tax is theft by our own gov..this is why we have accidents. The sinking of PM's is easier to accept than the greedy hands of our own gov. Kinda sad actually...

Everyone lost their PMs in a boating accident except me Solid. I was too afraid to get on a boat with my silver art bar collection. I could NEVER get on a boat with my silver art bar collection because I cherish those silver art bars way too much to lose them in a boating accident. :)

One more thing to remember............Since word has gotten around to the gov't about people losing their PM's in a boating accident, then the gov't has lots of scuba gear and an unlimited "PM recovery budget" to find all of those boating accident "victims" at the bottom of the sea. :)

EDIT: OH BTW...........Sorry for your PM loss Solid. :(

[SLV^GLD]

I have problems with it in principle but zero problems with it in practice.

[mick silver]

they done tax me on the paper i used ...

[TomD]

Unless you can go to an all cash existence, and there's something to be said for that if you can swing it, at some level of PM trading it becomes a game of Russian Roulette. In my pre-retirement phase of life (until 2008) , I ran a very high IRS visibility type of life and it would have been stupidity (or gambling in a game in which I absolutely could not afford to lose) for me not to have reported some fairly large sales that I made.

The board software interprets an 8 and a ) as a 8) .

[mamboni]

Why do you have to convert gold or silver to FRNs when you can trade directly for a good or service? Gold and silver were made for barter.

[TomD]

Why do you have to convert gold or silver to FRNs when you can trade directly for a good or service? Gold and silver were made for barter.

Well true but it is a lot more difficult in the case of real estate transactions where RE Agents, closing attorneys and all that crap is involved.

[Awoke]

I have a problem with the government taxing ANYTHING.

[po boy]

Why do you have to convert gold or silver to FRNs when you can trade directly for a good or service? Gold and silver were made for barter.


According to the UScode SAE and GAE are legal tender.

[mamboni]

Well true but it is a lot more difficult in the case of real estate transactions where RE Agents, closing attorneys and all that crap is involved.

When I think RE I think lawyers, paper work, government, counterparty risk and lots of middlemen and no secrets. When I think gold I think privacy, security, no counterparty risk and no paper trail. Gold and RE: Not perfect together.

[Awoke]

My bars are bullion. Most of my PM collection is bullion. Only a small amount (5%) would be made up of legal tender metals.

[mamboni]

According to the UScode SAE and GAE are legal tender.

...for face value, not bullion value. That's the rub.

[sirgonzo420]

...for face value, not bullion value. That's the rub.

So?

I'd work for $1 an hour if that $1 is a SAE.

[po boy]

...for face value, not bullion value. That's the rub.

As long as it rubs you right, say you bought an item for 50,000FRN then sold that item for GAE you just had a loss.

Might be poor business buying high and selling low.

[mamboni]

So?

I'd work for $1 an hour if that $1 is a SAE.

And the IRS would love to talk to you about your sweet arrangement.

[po boy]

What can they say, no you can't work for legal tender?

[mamboni]

As long as it rubs you right, say you bought an item for 50,000FRN then sold that item for GAE you just had a loss.

Might be poor business buying high and selling low.

The problem is that the IRS is no so dumb as to fall for such schemes. Otherwise, folk would be selling their homes for huge losses (in FRNS), declare a tax writeoff, and taking something under the table.

[Sparky]

I think there's an argument to be made for there to be no taxation. But having said that, I have more of a problem with how it is currently handled, rather than that it is taxed at all. There are these two glaring flaws:

1) If it's going to be taxed, it should be taxed like other investments, which is as ordinary income on short term gains, and 15% on long term gains. It's currently treated as a tax on "collectibles", which is similar to the short term rate regardless how long you've held it. That's just wrong.
2) If they are going to tax it, the current accountability is too loose and open for fraud. Gains on stocks are easily trackable since each transaction is recorded. There is no equivalent system in place for PMs, so the whole thing is on the honor system, which makes it ripe for inequity and fraud. It's a tax on the honest.

Furthermore, in my state there is a sales tax,and it's totally obsolete. I actually have more of a problem with this than the gains tax. Currently, it's taxable for purchases UNDER $1000, with the thinking that removing the tax on higher amount protects retail-wholesale dealer transactions. However, this threshold was in effect when gold was $300 and silver was $4. Fortunately, this works to the buyer's advantage, as a $1000 purchase no longer involves much metal. But it reveals the obsolescence of the rule, and that no legislator is giving it much thought.

But again, if there is going to be a sales tax, it should be treated like stocks, i.e. there should be a fixed cost per transaction. I pay $10 to buy/sell a stock right now, whether it is 10 shares or 10,000 shares. Any PM sales tax should be similar, and really be treated more of a "fee".

[po boy]

The problem is that the IRS is no so dumb as to fall for such schemes. Otherwise, folk would be selling their homes for huge losses (in FRNS), declare a tax writeoff, and taking something under the table.

You're right the tax man ain't no dummy,and he has tried and lost the battle.

http://www.newswithviews.com/brownfield/brownfield67.htm
"Robert Kahre owns a family business and instead of using paper money he paid his workers with gold and silver coins minted by the United States government. He paid them based on the “face value” of the coins. If he paid a worker a dollar an hour he paid with a silver dollar, which states on the coin that it is “one dollar” regardless of today’s value. His wages were so low that he didn’t have to file W-2 income tax forms or withhold taxes or pay workman’s comp. This upset the IRS, which charged him and his family with 161 federal tax crimes."

"On September 17, the jury returned its verdict refusing to convict all nine defendants of any of the 161 federal tax crimes they had been charged with. One would think, “we the tax payers would want to hear that the IRS was defeated by the use of the true money.” To my knowledge, the results of this trial were never printed or broadcast by any of the major news media. Three days after the trial’s conclusion, the Las Vegas Review Journal ran its first and last story about the outcome and then only because of public pressure from interested parties who attended the trial."

[madfranks]

they done tax me on the paper i used ...

Sure they do. If you hold a $100 bill for 10 years, and your purchasing power goes down by 20% over those 10 years then you've been "taxed" 20% of your money, for doing nothing other than holding it.

Which was hatha's point - holding gold instead will make sure you don't lose the purchasing power of the money you hold. That's like the whole point of owning PMs in the first place.

[Dogman]

Sure they do. If you hold a $100 bill for 10 years, and your purchasing power goes down by 20% over those 10 years then you've been "taxed" 20% of your money, for doing nothing other than holding it.

Which was hatha's point - holding gold instead will make sure you don't lose the purchasing power of the money you hold. That's like the whole point of owning PMs in the first place.
Bingo!

[mamboni]

You're right the tax man ain't no dummy,and he has tried and lost the battle.

http://www.newswithviews.com/brownfield/brownfield67.htm
"Robert Kahre owns a family business and instead of using paper money he paid his workers with gold and silver coins minted by the United States government. He paid them based on the “face value” of the coins. If he paid a worker a dollar an hour he paid with a silver dollar, which states on the coin that it is “one dollar” regardless of today’s value. His wages were so low that he didn’t have to file W-2 income tax forms or withhold taxes or pay workman’s comp. This upset the IRS, which charged him and his family with 161 federal tax crimes."

"On September 17, the jury returned its verdict refusing to convict all nine defendants of any of the 161 federal tax crimes they had been charged with. One would think, “we the tax payers would want to hear that the IRS was defeated by the use of the true money.” To my knowledge, the results of this trial were never printed or broadcast by any of the major news media. Three days after the trial’s conclusion, the Las Vegas Review Journal ran its first and last story about the outcome and then only because of public pressure from interested parties who attended the trial."


Yes, that case has been discussed here at GSUS. I'll wager that the defendent lost more money in legal fees than he gained using the bullion to pay his employees. Besides, do you want to risk a long expensive court case with the IRS with an uncertain outcome?

[Hatha Sunahara]

My objection to taxing 'gains' on gold and silver is that they are not really 'gains'. If you look at the increase in the price of gold and silver, and you consider it to be tied to the loss of value of what they call legal tender--fiat money FRNs, you should be able to claim that loss of purchasing power to offset the rise in your PMs value, and you remain whole--no gain or loss. But no, they won't allow you to make that claim of a loss because to them, the loss is invisible--not because of blindness, but because of corruption.

The government doesn't recognize the losses people experience in the purchasing power of their money because the FED inflates the money supply causing all the money to lose value. You are robbed of value, albeit you don't lose any 'money'. It looks like gold and silver are going up in value, but only relative to FRNs which are going down in value. So, because of the tax treatment of gains on PMs, you could wind up with nothing if you sell them after the government is done destroying the value of its legal tender. This is like how they drive you into a higher tax bracket if you get a cost of living increase in your pay because of the loss of purchasing power. This is how they steal from you under the pretext of inflation. It doesn't surprise me that there are 'boating accidents'. That is insurance against the idea that the government will itself survive its own misdeeds with money and still have the power to tax you.

Anybody have any good advice on where to get a good disposable boat?


Hatha

[Ponce]

Why do you have to convert gold or silver to FRNs when you can trade directly for a good or service? Gold and silver were made for barter.

You got it Dr.........that's why I got my PM and will use it......."they" can tax only what they kow........I mean, I'll be able to trade my two silver dimes for gas.

"I am poor and yet I am rich, because what I own is paid for"... Ponce

First post of the day..............good morning to one and all.

[mick silver]

Sure they do. If you hold a $100 bill for 10 years, and your purchasing power goes down by 20% over those 10 years then you've been "taxed" 20% of your money, for doing nothing other than holding it.

Which was hatha's point - holding gold instead will make sure you don't lose the purchasing power of the money you hold. That's like the whole point of owning PMs in the first place.

what i was saying was the paper i used to buy the metal with was taxes when i got payed for what every i was doing .

[po boy]

Yes, that case has been discussed here at GSUS. I'll wager that the defendent lost more money in legal fees than he gained using the bullion to pay his employees. Besides, do you want to risk a long expensive court case with the IRS with an uncertain outcome?

Well I'd wager that despite any losses he may have incurred his gains in the long run will out weigh the hassle.

I don't see a long expensive battle when this case could be used in the pleadings.

[sirgonzo420]

Well I'd wager that despite any losses he may have incurred his gains in the long run will out weigh the hassle.

I don't see a long expensive battle when this case could be used in the pleadings.

I thought Kahre won, and then somehow later the IRS got him for something.

[Santa]

I thought Kahre won, and then somehow later the IRS got him for something.

I don't know, but it sure wouldn't surprise me.

[mamboni]

You got it Dr.........that's why I got my PM and will use it......."they" can tax only what they kow........I mean, I'll be able to trade my two silver dimes for gas.

"I am poor and yet I am rich, because what I own is paid for"... Ponce

First post of the day..............good morning to one and all.

Ponce,

When aliens abducted him, they asked if he would probe them.;D

[Twisted Titan]

Did you pay taxes on the money to buy the metal? Definately

Did you pay taxes. when you purchased or had the metal shipped to you? Probally


So if you paid taxes when you earned it and bought it ..........what the eff makes you think you have to pay taxes when you sell it?



If you want to pay Uncle Sugar three times go right ahead.........it wont be my Silver @$$


My obligation is to My Clan

[1970 silver art]

Ponce,

When aliens abducted him, they asked if he would probe them.;D

........Or maybe the aliens asked if Ponce would scannn them with some of his TP. :)

[Grog]

red tape
I can see can't you see?
red tape
do in to you do in to me
red tape
bureaucrasie & bourgeoisie
red tape
killing you killing me

tax this
tax that
tax this
taxthat

no more red tape


http://www.youtube.com/watch?v=iExJ2Jtlnlo

Circle Jerks rock! Love some old school Punk Rock!

[mick silver]

my new silver rocket

[solid]

Anybody have any good advice on where to get a good disposable boat?


Hatha

I agree with Hatha, any gains on PM's are not really 'gains'. Furthermore, if they do tax gains on PM's, then any losses should be tax deductible. That includes any losses due to reckless boating accidents.

I should get one heckofa refund this next tax season. Some of us are really bad boaters.;D

[solid]

I got an idea..

The next GSUS round up, should be a boating accident. We buy a cheap boat, go out and barbeque for a little gold/silver coin show and tell. A GSUS coin club show on the water. Tragedy ensues. Boat takes on water and we issue a Mayday boat going down...the Coast Guard saves us. The accident is documented including all our coins that sank with the boat. Ponce brings TP so we can wipe our tears away..

Then, come tax time. We show our PM purchase reciepts to our tax guy, then show the documented accident...then deduct all our losses. Get a nice big refund.

[1970 silver art]

I got an idea..

The next GSUS round up, should be a boating accident. We buy a cheap boat, go out and barbeque for a little gold/silver coin show and tell. A GSUS coin club show on the water. Tragedy ensues. Boat takes on water and we issue a Mayday boat going down...the Coast Guard saves us. The accident is documented including all our coins that sank with the boat. Ponce brings TP so we can wipe our tears away..

Then, come tax time. We show our PM purchase reciepts to our tax guy, then show the documented accident...then deduct all our losses. Get a nice big refund.

Hey solid, Good luck with that. Unfortunately, I would not be able to attend because I am scared of taking my silver art bars on a boat. :) :D

You forgot one thing solid...............The Coast Guard also has scuba gear. :D

[Awoke]

Circle Jerks rock! Love some old school Punk Rock!

Oh really? Well how about some DRI then?




Reagonomics killing me
Reagonomics killing me
Reagonomics killing me
Reagonomics killing you!

[solid]

Hey solid, Good luck with that. Unfortunately, I would not be able to attend because I am scared of taking my silver art bars on a boat. :) :D

You forgot one thing solid...............The Coast Guard also has scuba gear. :D

You can trust me, Art. I've learned all my boating skills from Captain Ron...remember, if anything's going to happen, it's going to happen out there. ;D


http://www.youtube.com/watch?v=Sut9V7_ZIwE&

[1970 silver art]

You can trust me, Art. I've learned all my boating skills from Captain Ron...remember, if anything's going to happen, it's going to happen out there. ;D


http://www.youtube.com/watch?v=Sut9V7_ZIwE&

I am sure that you are a very skilled boater solid but my fear of boats prevents me from taking my silver art bars on a boat for show and tell. Bummer............

[solid]

I am sure that you are a very skilled boater solid but my fear of boats prevents me from taking my silver art bars on a boat for show and tell. Bummer............

Don't worry Art, I'll cure that fear of boats for ya.;D

What could go wrong? This is how you dock a boat!


http://www.youtube.com/watch?v=8alNxLjCBJc&

[Hatha Sunahara]

It just occurred to me that if the government allowed people to claim the reduction of purchasing power from inflation as a loss, tax revenues would go way down. Also, the government wouldn't have any incentive to print excessive amounts of money. So that's never going to happen.

If you bury it, and forgot where, is that as good as a boating accident?


Hatha

[solid]

If you bury it, and forgot where, is that as good as a boating accident?


Hatha

I believe according to tax law that's referred to as a "digging accident". I had one yesterday, I got my crovel in...and my testosterone spiked holding such manliness in my hands. I went out and buried a bunch of PM's and then went to work chopping at trees. Yup, forget where I buried them. Damn shame.

http://gold-silver.us/forum/showthread.php?48757-The-Crovel

[Dogman]

I believe according to tax law that's referred to as a "digging accident". I had one yesterday, I got my crovel in...and my testosterone spiked holding such manliness in my hands. I went out and buried a bunch of PM's and then went to work chopping at trees. Yup, forget where I buried them. Damn shame.

http://gold-silver.us/forum/showthread.php?48757-The-Crovel Is this you picking your tree to chop? Lefty or rightly , choices choices hum mm?

http://www.bigdamnband.com/wp-content/uploads/2008/08/redwoodjayme.jpg

680

[Joe King]

It just occurred to me that if the government allowed people to claim the reduction of purchasing power from inflation as a loss, tax revenues would go way down. Also, the government wouldn't have any incentive to print excessive amounts of money. So that's never going to happen.

If they were to allow that, It would be tantamount to a public admisson that their unit of account doesn't hold value.
In their view, a $20frn in 1933 is equal to a $20frn today.
...and the only way their game works is by continuing to pretend they are equal.

The capital gains tax on PMs could also be looked at as their way of punishing those who attempt to preserve purchasing power or even, God forbid, even maybe get ahead because of their policis, as well as being a way to encourage you to keep your $ in paper "asests".