Cash only at Coin Stores
CoinHoarder
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I have noticed that pretty much every coin store that I have ever been in, accepts cash only for purchases. No checks or credit cards. Personally, I have never expected to purchase anything from a coin store with anything but cash on the barrelhead. I like doing business this way anyway.
I was just wondering, why do MOST coins stores usually deal in cash only transactions?
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Credit card have the risk of a chargeback and have fees. Checks can bounce. Cash is easier. Many dealers will take checks from buyers they know and trust.
There is no paper trail with cash.
Yes, but other businesses that accept checks and credit cards have the same risk and fees as the coin business, don't they? Is there a difference.
Many businesses have much higher margins which makes covering fees and handling loss much easier. Coin dealers also sell highly liquid items; if someone untoward wanted to buy something to flip quickly for cash and then bounce the check/file a chargeback, coins and precious metals are a very easy target.
You sell bullion on a 3 to 5% margin. How are you going to do that if you pay 2 to 3% in processing fees?
Lots of businesses won't take checks. They are inherently risky.
Not usually. Many coin stores create their own paper trail but still have the same rules.
My store writes out receipts for all purchases.
If the coin store got audited would the IRS knock on the purchaser's door to see the receipt?
When I would buy coin supplies at the coin shop if I paid in cash there was a discount. Nothing formal just a number knocked off the top.
I have a friend who owns a coin store (also comic books). He takes cards and, I think, checks.
When I lived in Maryland, some coin dealers that I knew well didn't charge me for sales tax when I paid in cash. I assumed they were covering that expense.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Lol. So, to save a 3 % Mastercard fee, they were paying 7 or 8% in sales tax? You really believe that?
I pay cash for everything that I can including my morning coffee.
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What is "sakes tax"? Whatever that is, I doubt they pay it.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Yeah, it's probably in the "do not pay" pile along with the sales tax.
Taxes..................pffffft.
Then why does each federal reserve note have a unique identification number ?
I deal almost exclusively in cash. Many restaurants tack on 3% for CC use... I avoid that.... I will use CC's for some online purchases. Cheers, RickO
I live in the upper midwest and there are a few areas of business where it's not uncommon for transactions to be done in cash. From professional dealings with these folks, they typically show little to no net income, but drive very nice new pickups.
I definitely have a rebuttable presumption for "cash only" businesses.
Then you should ask for a receipt to get a paper record. If you have established business relationships with a dealer or someone else can vouch for you then checks should be OK. It is a serious crime to pass a bad check.
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When I’m lucky enough to find something right for me at a show or coin shop in person, with people I’m new to dealing with, I don’t like to make a serious offer on a coin and then whip out my checkbook or card. A serious cash offer has a better ring to it. If a deal calls for mailing a check, I don’t expect the item until long after a check clears. I basically try to accommodate the seller preferences and not have them making adjustments for me as the buyer. As relationship trust levels develop, things become more gracious and enjoyable in the money department. Sometimes when I’m traveling, or was traveling more 😕, I find a shop that is awesome and I think “I wish I had more time get to know these people as a regular” and I don’t expect anyone to give me the benefit of the doubt just walking off the street beyond what my first impression can convey.
The coin shop I do business with prefers cash, but will take a credit card. With cash he gives you a better price. What is not to love about that.
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I used to take cards, but folks would come in to buy bullion and want the best price, and in most cases id be making a dollar to 1.50 per oz, and the cc fee's would wipe out half the profits. No to mention the sales tax issues back when I had to charge it. Cash only for me now, I will take a check from folks i know. Also, will take a PP payment on general coins, not bullion.
...because it's much easier to commit tax fraud without a paper trail...and then to complain about "high taxes" and "burdensome reporting requirements"!
If I'm the IRS, I explicitely would audit cash only businesses...like most pizza stores in NYC!
Oh excuse me...did I say the quiet part out loud?
At ANA shows, I teach a class that is tailored to people who have never attended a large show before and we discuss the correct way to negotiate a price for a coin that they are interested in. I explain that some dealers do accept credit cards and if you plan to pay with a card, you should mention that before the negotiations. It is wrong to get down to a "bare bones" price and then expect the dealer to eat a transaction fee. Dealers have come to me and said that they were so impressed with the consideration of my students that they gave them their best price anyway.
That's common with some businesses: https://www.justice.gov/usao-ct/pr/owner-several-connecticut-and-new-york-pizza-restaurants-sentenced-prison-tax-offense
I've seen some CDN issues indicating dealers nailed for tax offenses. It seems to me to be more laziness mixed in with greed, not easy to do the right thing.
some have eluded to the answer -- its low key tax evasion (perhaps mixed with a dash of the government tracking paranoia so many share)
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We take cash or cards at my B&M, checks if we know you, or are willing to wait for them to clear...
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Most of the ones in Rochester take cash or cards but no cards on bullion (margin too thin).
I always deal cash and get a receipt, that way both the dealer and I are covered, money accounted for IN and Out. Makes things a lot easier on the books at the end of the year.
Being given a receipt has no bearing on whether the cash was reported, or went straight into his pocket.
As someone who’s worked in receivables for the last 25 years, I concur with what others on this thread have said about credit card fees. Smaller businesses can expect to pay 3 to 4% of credit card sales so this can really add up on a low-margin business. Other retailers can simply absorb the fees into their pricing since most of their sales are on credit cards, and larger retailers are able to negotiate fees of no more than 2%. I imagine most local, smaller dealers simply don’t have that same ability due to the higher volatility of coin and precious metal prices, low margins, low cc payment volume, among other factors.
Another issue with accepting credit cards is the risk of data breach. Companies have to follow all sorts of rules and regulations to keep customer credit card information secure, and face huge fines if they are responsible for a breach. For small businesses with low margins and minimal staff, they don’t have the time or resources to manage it.
FWIW...I always pay cash at shows and negotiate the price downwards accordingly.
As a buyer, it's not my concern how the seller is handling his tax reporting...only that I get the lowest price on my side of the table.
Our local shop just started accepting cards - for 3% fee!!
I think it’s mostly because many coin shops also move bullion and that’s a mostly cash market.
To scare people into thinking they're tracking it.
Paper money eventually returns to its intrinsic value. Zero. Voltaire. Ebay coinbowlllc
The two I buy from take cash only and issue no receipt for purchases.
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“Coin people” tend to be “hard money” people. I imagine some would accept gold dust or bullion before they’d take an Amex or Discover card.
I think the # is for their control tracking of notes issued, to detect potential counterfeiting and maybe even for tracking bank robbery cash, definitely not for tax reporting.
Without records how do dealers tabulate all their transactions and figure whether they are making money? Also what about counterfeit and problem coins coming back to them in returns? Are they going to continue their shady business practices to say they never sold the problem issue or say "all sales final"? How do they handle potentially stolen material they buy and then sell? Most states require a filing of collectibles and precious metals purchases for overview by local and state agencies to stem the tide on stolen material fueling the major drug epidemic. Does any other business operate like this except for the black market economy, totally cash, no records given and no one to be accountable to??
As soon as the regular gang of “debating experts” show up on this thread it too will probably be closed.
So, in summation, cash is our king.
If you have a B&M that accepts cash, cheque or credit card - I would figure that you if you are a bargain hunting Scot like meself - you hae more haggling power wi' dosh.
I always thought it was cash only since margins were so thin. I'm a small fish, so that works for me, don't have to worry about getting jacked with a sock full of nickels over a few bucks on hand.
I can see it from the dealer's perspective: no processing fees, no chargebacks, no bounced checks, (and no taxes?) with cash. I could also see how lots of physical cash in hand gives them the ability to buy whatever walks in the door or up to the table. But there may also be a generational component. Folks over 50 were taught that credit cards were for "emergencies only". Many folks under 30 probably have never carried enough cash to buy a Red Book.
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Cash is liquid and coin stores have safes.
I take cash only at shows. Cash is king In the coin biz. Buying cash should be a large part of one’s investment in RCI. Want to buy with a card - go thru McDonalds.
Another thing is narrow spreads don’t support fees, etc. For online I have to mark up stuff higher than shows.
goodness sakes
A Barber Quartet is made up of Nickels, Dimes, Quarters, and Halves.
What do you all think about large money purchases? you potentially carry $50,000 to $100,000 in cash around with you? How often do you pre-setup larger purchases and bring a cashier's check or do a money order?
A Barber Quartet is made up of Nickels, Dimes, Quarters, and Halves.
There are many cases like this one in Tennessee with dealers who believe they are exempt from taxes. "The wheels of justice turn slowly, but grind exceedingly fine." https://www.leagle.com/decision/19961463923sw2d54011462
https://the-moneychanger.com/answers/the_most_dangerous_man_in_the_mid_south
I saw a movie or something once it was about 2 sets of books. I think the plot was cash in cash out , one book. Reported everything else in second set. Even ran 20-30 percent cash through it so things looked right. Not the bigger cash but enough to show some. Ofcourse checks , CC and such. Even showed a little trading on the books. Everything was fine until reality stepped in, along with a divorce for infidelity. Movie ended with most everyone going to jail. I wonder how it might have ended if the owner was single 😉
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This goes beyond being a "dealer". It's more about his political beliefs than his business.