Does the government hate coin collectors?
lava
Posts: 3,286 ✭✭✭
Long term capital gains tax rate is 28%, versus only 15% for stocks. Seems oddly unfair given that the US Mint is coming up with new designs to promote the hobby. If the government wanted to promote the hobby, given equal tax treatment would be welcome.
If any congressman are reading this, get this corrected already, you baboon.
If any congressman are reading this, get this corrected already, you baboon.
I brake for ear bars.
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where's the tar n feathers and something tells me the i.r.s. still doesn't have a booth at boston harbor
or did you reverse your title by mistake
as that's the crowd i'm in
<< <i>I hate the unequal tax implications as well. However, I would rather pay the higher rate, than have the government oversight and regulation that are required with stocks and bonds transactions. Can you imagine, having to register CUSIP #'s, account numbers, brokerage houses commissions etc that currently come with stock trading if this regulation was extended to our hobby. I'd prefer the 28% cap gains than all that government intrusion into my collection. >>
Isn't it counterintuitive that the area with the MOST oversight has the LEAST tax burden?
So why can't we have both a lower tax burden and less oversight?
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
True. Absolutely!!
Long term capital gains tax rate is 28%, versus only 15% for stocks. Seems oddly unfair given that the US Mint is coming up with new designs to promote the hobby. If the government wanted to promote the hobby, given equal tax treatment would be welcome. If any congressman are reading this, get this corrected already, you baboon.
I once asked a CPA/tax specialist why the difference in rates. His answer?
“Whoever said the tax rates are fair?”
Lava has an exceptionally good point, however. These same Congressmen who push surcharged
coins as a way of squeezing money out of collectors for some pet charity also pass the unfair tax
legislation aimed at those who invest in collectibles.
Denga
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
<< <i>Long term capital gains tax rate is 28%, versus only 15% for stocks. >>
You can not buy & sell Stocks with CASH......................
There is a paper trail for every transaction you make in the stock market.
The market thinks that stocks will soon be back to 28%.
<< <i> and the common people don't seem to care. >>
I have a feeling they are starting too.
Plus expenses can be deducted from the coin investments as well.
Stocks don't have too many added expenses to deduct before a gain is realized.
Gardnerville, NV
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<< <i>As long as I get a bailout as a "wannabe" dealer after I lose my shorts, I don't care. >>
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CG
The govt wouldn't be stupid enough to bring an inflation factor to the forefront for any assets let alone stocks. The last thing they need to enlighten J6P on is how much he has lost in stocks due to the 40% depreciation of the USDollar over the past 7 years. Let him continue to think that he has made a few percent in those years.
Don't expect to see a dollar adjusted graph of gold vs stocks on the WSJ any time soon. Reference is always made to the "benign" CPI, which as we all know is designed "not to change." (ie a "constant price index"). J6P is allowed to use the CPI for all the comparisions his or her little her desires. In using a dollar comparison one would find that many coins have outdistanced stocks for years because they tend to out-pace the rate of dollar depreciation during inflationary times. Many worthwhile coins have doubled or tripled in price since 2001...then again many widgets have barely kept up or even lost value. The next question is how many collectors actually report their capital gains oncoins? In this respect I would think that the govt casts a wary eye at our hobby. They don't care about the 90% of hobbyists or casual buyers who lose money. But they want that other 10% to pay up.
roadrunner
<< <i>Capital gains for coin collecting? The capital gains tax benefit is intended to encourage the investment of capital in the growth of American industry and commerce. If anything, coin collecting diverts money away from productive investment and freezes it in non-productive assets. In a capitalist economy, one could justify a tax surcharge on profits from the sale of non-productive assets in order to discourage people from putting money into such things.
CG >>
Yet you can buy an ETF that tracks the price of oil, or gold, and get the 15% rate, and it is essentially like trading a commodity.
<< <i>Yet you can buy an ETF that tracks the price of oil, or gold, and get the 15% rate, and it is essentially like trading a commodity >>
Good point. Some more changes to the Internal Revenue Code are needed. And they should throw raw land in with coins, gold bars, and pork bellies.
CG
If that actually were to happen, we will have a depression. In my opinion, in our delicate financial condition, even if the '03 tax cuts do not get extended, we might get one.
Julian
roadrunner
<< <i>There's TAXES on selling coins? >>
Yes, unless it's a cash transaction.
Worry is the interest you pay on a debt you may not owe.
<< <i>
<< <i>There's TAXES on selling coins? >>
Yes, unless it's a cash transaction. >>
This reminds me of a funny story that happened last weekend. My inlaws hired a professional tax sale organizer to do a tag sale for them. The lady's fee is 1/3 of the cash proceeds from the sale. I was talking with this lady, and I mentioned something about the taxes on her business. With a straight face, she told me that her fees were exempt from taxation. When I asked why, the only "authority" that she could quote was herself, saying that if she had to pay tax on her fees, she would be working for below minimum wage, and that is not allowed.
To make this even more bizarre, that evening I got home and opened up our local newspaper. Longacre lives in a one-horse town and each week the paper profiles a resident of the town. Would you believe it (I kid you not), this tag sale lady was the person of the week! Continuing with the bizarre, the article tells about her, her tag sale business, etc. Then it goes on to say that this lady volunteers to prepare income tax returns for the senior citizens in my town at our local library! Incredible.
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
“Whoever said the tax rates are fair?”>>>
what a crock and he proclaims to be a cpa or specialist
i have 2 very dear friends of mine both out of the same special forces marine unit reindeer marines they both proclaim but that was included as they were taught no pain no gain and pain ain't a thing compared to their pow trainings
so it was decided by them to have a lil fun being out of action "per se" so they refused paying taxes and won their case at the supreme court on many issues but the one that stopped the supreme court in it's tracks was when they informed those judges to seek chamber time and review the laws president mc kinley endorced as noted below
"if there are to be taxes upon the people of this land it is to be fair and equal and if it is not...that tax law shall be deemed unjust"
i'm an idiot on alot of things as i never studied to depths as these 2 did but i'm sure it's easy enough to verify as these reindeer marines held president mc kinnley in highest respect over his enactments
and for a tax specialist or cpa to not know his field makes me laff...they're brain washed i.r.s. collectors and don't even know it
so whoever said "that tax rates are fair"...it was president mc kinley who ensured they "were and are to be"
anyone care to dig up mc kinley's stance is more then welcome too as tax rate differences are unfair according to the letter of the law
Who sid you have to pay a personal income tax if you are just an employee- making a wage, not an income?
IRS is a joke and our guberment is not much better- about time the PEOPLE take back the FREEDOM we once had- and take it away from politicians who could care less about you and more for the so called corporate world.
I will now be able to say I own a part of an insurance Comapny, and 3 major lending institutions, when the bailout is passed- and I'll bet a dollar to 700 billion- I won't be able to get a loan from any of these so called financial megaladons.
AND ITS MY D A M M MONEY!!!
i likes it
<< <i>The tax system is not fair, but everyone gets their panties in a bunch over the individual income tax rules. The real monkey business happens in the corporate tax laws, and things get really wild in the international tax laws. The Masses should be up in arms about the corporate/international tax law, but no one hears about this stuff, and the common people don't seem to care. >>
Even you who seem to know something about these tax laws gave no specific examples.
This is not as staight forward as it looks. Anyone, can not just "trade" any coin for another coin(s) and call it an exchange, at least not per lawyer Armen Vartian who frequently writes articles for Coin World.
This is from an older post of mine:
Lawyer Armen R. Vartian did a great piece on "like-kind exchanges" in Coin World (9/4/2006). Since this topic has been discussed many times here this article was well worth keeping. There are numerous restrictions assuming Vartian's opinions are correct. In summary:
limited circumstances only:
-arms length's parties (not relatives for example or your business buddy)
-related parties must each hold the property for at least 2 years!!!
-held purely for investment purposes (not a hobby) - profit motive!!
-collectors who act as dealers for tax purposes to deduct expenses can not use like-kind-exchange - no dealers.
-dealers trading their stock is not allowed - no dealers.
-item must be of "like-kind" (no bullion items since that's cash)
-findings against some trades in different metals have been disallowed - no guarantee that a trade of a large cent for a silver
dollar grouping would be allowed for example.
-must file form 8824 for the exchange (see code 1031 exchanges) to trigger the IRS - that's always fun to help red flag you for an audit.
-barter exchanges (such as coins for residences does not fly)
The 2 year hold for both parties, profit motive, investment coins put back for several years, eliminates most every transaction from consideration. I can't even believe the 2 year rule for both parties. You basically have to monitor another investor's time frame to legitimize your own holding period! But that's what Vartian is saying.
I'd be surprised if even one coin investor on one single transaction has ever met all these conditions. One cannot get cash for a coin, buy another, and then call that transaction a like-kind-exchange.
Good luck with this one if what Vartian says is correct. Having to go through this many hoops essentially destroys the concept of an exchange. In other words, uncle doesn't want this being done. But no doubt there is very little enforcement here.
As HRH would say......."have fun with your trade!"
roadrunner
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>No taxes if you buy a like commodity; ie. another coin. >>
Care to elaborate?
I sure thought I read somewhere that trading the ETF for silver (SLV) invoked the same tax rate as collectibles. But I don't trade SLV in a taxable account.