Important Email from ICTA! Please Act Now!
timcoin
Posts: 674 ✭
(email I received from local coin dealer. it originated from ICTA)
URGENT -- CONTACT YOUR MEMBERS OF CONGRESS NOW
Tell Your Non-ICTA Member Colleagues to do This Also
TWO (2) ISSUES NEED YOUR IMMEDIATE ATTENTION
1) New 1099 Reporting Requirements Would Include ALL Purchases from Your Customers.
As of 2012, you will be required to report on a 1099 form ALL goods and services you purchase in excess of $600 – rental cars, airline tickets, office supplies, utilities, etc.
This means you would be required to file a 1099 for purchases from ALL your customers – including coins, bullion, paper money, etc. – over $600.
Beginning in 2010, a new law, part of the massive health care reform legislation, requires that you must submit an IRS Form 1099 for all goods and services you purchase in excess of $600. This requirement will likely include many or all of your wholesale transactions as well, and we are researching this further.
Rep. Dan Lungren (R-CA) has introduced HR 5141 to repeal the 1099 reporting requirement included in the health care bill. Several large retail organizations, including the National Federation of Independent Business, the US Chamber of Commerce, and the Small Business Legislative Council, have joined forces to support this legislation, as has ICTA.
The 1099 reporting requirement in the health care law expands the current reporting requirement of business-to-business payments to include incorporated businesses (the current law requires reporting for unincorporated businesses only - sole props, LLC, partnerships) and to property (the current law only includes services) over $600. The goal behind the provision is to increase third-party reporting as a way to close the tax gap to pay for health care reform.
Do not confuse this with your current 1099-b requirement. This is new and far worse.
Contact your members of Congress to ask them to support HR 5141 to eliminate this unnecessary and burdensome reporting requirement for your small business.
PLEASE DO THIS NOW – DO NOT WAIT.
WE MUST HELP MOVE THIS BILL FORWARD!
2) New Financial Reform Bill Could Kill Your Mail, Phone, and Internet Business.
House and Senate conferees are meeting NOW to resolve the differences between the House and Senate versions of the Financial Reform Bill. In the 1,566 pages of the Senate’s overhaul of the nation’s financial system is a provision that could allow the CFTC to require you to deliver products in only 2 days – an impossible standard for any transactions other than face-to-face.
The Senate version contains this provision; the House version maintains the current 28-day delivery timeframe.
The CFTC has never had authority over retail sales with physical delivery, but the Senate bill gives the CFTC this power.
This provision has received little attention in the Senate, and the potential unintended consequences are serious. The sweeping language of the bill applies to any commodity, not just precious metals.
All ICTA members MUST CONTACT THEIR MEMBERS OF CONGRESS (Representative & Senators) NOW. Here is a message you can cut and paste into the email contact option on their websites:
Subject: Financial Reform
RE: Section on Retail Commodity Transactions of the Financial Reform Bill, we urge you to ADOPT the HOUSE language that preserves a reasonable and time-tested delivery period for precious metals and other commodities. We urge you to REJECT the SENATE language which could eliminate ALL retail transactions of any kind (internet, mail order, etc.) except face-to-face transactions by expanding the CFTC’s power to dictate delivery time even for mom and pop coin shops.
NOTE: If your Members of Congress are on the following list, it is ESPECIALLY URGENT that you write, call, email, etc. Conferees for the Financial Reform legislation are:
Senate
Senator Chris Dodd, D-Conn
Senator Tim Johnson, D-SD
Senator Jack Reed, D-RI
Senator Charles Schumer, D-NY
Senator Blanche Lincoln, D-Ark
Senator Patrick Leahy, D-VT
Senator Tom Harkin, D-Iowa
Senator Richard Shelby, R-Ala
Senator Michael Crapo, R-Idaho
Senator Bob Corker, R-Tenn
Senator Judd Gregg, R-NH
Senator Saxby Chambliss, R-GA
House
Rep. Barney Frank, D-Mass
Rep. Paul Kanjorski, D-Penn
Rep. Maxine Waters, D-Calif
Rep. Carolyn Maloney, D-NY
Rep. Luis Gutierrez, D-Ill
Rep. Mel Wat, D-NC
Rep. Gregory Meeks, D-NY
Rep. Dennis Moore, D-Kan
Rep. Mary Jo Kilroy, D-Ohio
Rep. Gary Peters, D-Mich
Rep. Collin Peterson, D-Minn1
Rep. Henry Waxman, D-Calif2
Rep. John Conyers, D-Mich3
Rep. Edolphus Towns, D-NY4
Rep. Nydia Velazquez, D-NY5
Rep. Spencer Bachus, R-Ala
Rep. Joe Barton, R-TX
Rep. Sam Graces, R-MO
Rep. Darrell Issa, R-Calif
Rep. Frank Lucas, R-Okla
Rep. Lamar Smith, R-TX
Rep. Ed Royce, R-Calif
Rep. Judy Biggert, R, Ill
Rep. Shelley Moore Capito, R-WV
Rep. Jeb Hensarling, R-TX
Rep. Scott Garrett, R-NJ
1 Chair, House Agriculture Committee; 2 Chair, House Energy & Commerce Committee; 3 House Judiciary Committee; 4 House Oversight & Government Reform Committee; 5 House Small Business Committee
CONTACT YOUR MEMBERS OF CONGRESS NOW.
Go to www.house.gov and www.senate.gov, to find all contact information.
AML/Cash Reporting News & Reminders
• When banks demand a copy of your AML Plan (or they’ll close your account), they usually give you only 2 weeks to comply. Heads Up: If they do close your account, any checks still outstanding will bounce. You may wish to limit writing checks on that account until you’ve met the bank’s requirements.
• Are you really wholesale only? If you consider yourself a wholesale-only dealer, and therefore exempt from Section 352 compliance, you should note that purchases from and sales to employees, friends and family will likely be considered “retail” transactions, not wholesale, and might necessitate your company’s compliance with Section 352.
Still so much confusion about different IRS regulations. Here’s a mini-recap:
• IRS/FinCEN – Form 8300. This is the form you report receipt of cash (and cash-equivalents like money orders and cashier’s checks) of over $10,000. You have 15 days to file.
• IRS Information Return – Form 1099b. This has nothing to do with cash payments. This is the form you use to report when you purchase certain precious metals commodity products (see “shopping list” on the ICTA website under Members Only section.) This form is filed at the end of the calendar year. While there is an exemption from filing if you are purchasing from a corporation, note that an LLC is NOT exempt.
• IRS Form #109 – SAR (Suspicious Activity Report). Coin dealers are not REQUIRED to file SARs but may wish to do so in certain circumstances. Check with your AML Plan’s policy or Plan provider before filing a SAR.
• CTR Form #103 – Currency Transaction Report. This is what the bank or other financial institution files. Coin dealers file an 8300, not a CTR.
Important Structuring reminder:
Most dealers know that structuring a cash transaction to avoid reporting is illegal. This is not just when you receive cash but also includes your deposits of cash into your own bank account. Example:
Dealer Joe had a number of cash transactions in his shop this week since many people were buying gold coins. He took in a cash total of $14,000. None of these transactions was related, and no 8300 forms were needed. Dealer Joe kept the cash on hand since he was going to a show that weekend, and he knew that he’d need cash to make purchases at the show.
While he was able to make some purchases at the show, most people wanted to buy, so he not only didn’t use up all the cash he’d brought, but wound up coming home with $5,000 more.
• Scenario I: On Monday morning, Dealer Joe decides he only needs to keep half of this on hand for making purchases in his shop. He prepares a deposit slip for the other half ($9,500.) and deposits that cash in his account.
This is perfectly OK. He is not structuring his transaction to avoid any reporting requirement.
• Scenario II: On Monday, he decides he only needs to keep $5,000 on hand and wants to deposit the other $14,000. But he remembers something about $10,000 in cash and decides to split up his deposit to $7,000. on Monday and he’ll deposit the other $7,000 the next day.
This structuring is not OK since it is for the purpose of avoiding reporting. In addition, by making the deposits on consecutive days, this triggers a reporting requirement anyway. He’ll be fortunate if the bank doesn’t report these 2 transactions as “suspicious.” Joe should just have deposited the whole $14,000. Having a form filed is no big deal, but he has now created his own problem!
If you believe that a customer’s transactions may be linked to terrorist activity, you should immediately call the Financial Institutions Hotline at (800) 556-3974. You may want to keep this number handy just in case. Let’s hope you never need to use it.
COMMODITIES AND TELEMARKETING INFORMATION FOR ICTA MEMBERS
ICTA member Cosgrove Law, LLC, specializes in compliance with state commodities codes and telemarketing regulations. They have compiled a 2-volume 50-state 500 page commodities legal survey which they update annually. This survey provides a comprehensive overview of the relevant portions of each state’s securities and commodities code and how precious metals retailers may be affected by them. This compendium is available to ICTA members at the special price of $2500 with annual changes provided at minimal cost.
Cosgrove Law is also updating ICTA’s Telemarketing Information Kit. If you would like a copy of the updated kit, contact Eloise. We will charge the usual $50 ICTA member price for the updated kit.
Cosgrove Law LLC can be reached at www.cosgrovelawllc.com or (314)563-2490. ICTA appreciates Cosgrove’s donation of the updated Telemarketing Information Kit.
Back to top^
ICTA’S BOARD WILL MEET IN BOSTON
ICTA’s summer Board of Directors meeting will be held on Wednesday, August 11, in Boston during the ANA World’s Fair of Money. The meeting begins at 6:45 PM and concludes by 10:00 PM. All ICTA members are welcome to attend but must contact Eloise to make a reservation (eloise.ullman@ictaonline.org or 410-626-7005). Each meeting participant pays an equal share of total dinner costs.
URGENT -- CONTACT YOUR MEMBERS OF CONGRESS NOW
Tell Your Non-ICTA Member Colleagues to do This Also
TWO (2) ISSUES NEED YOUR IMMEDIATE ATTENTION
1) New 1099 Reporting Requirements Would Include ALL Purchases from Your Customers.
As of 2012, you will be required to report on a 1099 form ALL goods and services you purchase in excess of $600 – rental cars, airline tickets, office supplies, utilities, etc.
This means you would be required to file a 1099 for purchases from ALL your customers – including coins, bullion, paper money, etc. – over $600.
Beginning in 2010, a new law, part of the massive health care reform legislation, requires that you must submit an IRS Form 1099 for all goods and services you purchase in excess of $600. This requirement will likely include many or all of your wholesale transactions as well, and we are researching this further.
Rep. Dan Lungren (R-CA) has introduced HR 5141 to repeal the 1099 reporting requirement included in the health care bill. Several large retail organizations, including the National Federation of Independent Business, the US Chamber of Commerce, and the Small Business Legislative Council, have joined forces to support this legislation, as has ICTA.
The 1099 reporting requirement in the health care law expands the current reporting requirement of business-to-business payments to include incorporated businesses (the current law requires reporting for unincorporated businesses only - sole props, LLC, partnerships) and to property (the current law only includes services) over $600. The goal behind the provision is to increase third-party reporting as a way to close the tax gap to pay for health care reform.
Do not confuse this with your current 1099-b requirement. This is new and far worse.
Contact your members of Congress to ask them to support HR 5141 to eliminate this unnecessary and burdensome reporting requirement for your small business.
PLEASE DO THIS NOW – DO NOT WAIT.
WE MUST HELP MOVE THIS BILL FORWARD!
2) New Financial Reform Bill Could Kill Your Mail, Phone, and Internet Business.
House and Senate conferees are meeting NOW to resolve the differences between the House and Senate versions of the Financial Reform Bill. In the 1,566 pages of the Senate’s overhaul of the nation’s financial system is a provision that could allow the CFTC to require you to deliver products in only 2 days – an impossible standard for any transactions other than face-to-face.
The Senate version contains this provision; the House version maintains the current 28-day delivery timeframe.
The CFTC has never had authority over retail sales with physical delivery, but the Senate bill gives the CFTC this power.
This provision has received little attention in the Senate, and the potential unintended consequences are serious. The sweeping language of the bill applies to any commodity, not just precious metals.
All ICTA members MUST CONTACT THEIR MEMBERS OF CONGRESS (Representative & Senators) NOW. Here is a message you can cut and paste into the email contact option on their websites:
Subject: Financial Reform
RE: Section on Retail Commodity Transactions of the Financial Reform Bill, we urge you to ADOPT the HOUSE language that preserves a reasonable and time-tested delivery period for precious metals and other commodities. We urge you to REJECT the SENATE language which could eliminate ALL retail transactions of any kind (internet, mail order, etc.) except face-to-face transactions by expanding the CFTC’s power to dictate delivery time even for mom and pop coin shops.
NOTE: If your Members of Congress are on the following list, it is ESPECIALLY URGENT that you write, call, email, etc. Conferees for the Financial Reform legislation are:
Senate
Senator Chris Dodd, D-Conn
Senator Tim Johnson, D-SD
Senator Jack Reed, D-RI
Senator Charles Schumer, D-NY
Senator Blanche Lincoln, D-Ark
Senator Patrick Leahy, D-VT
Senator Tom Harkin, D-Iowa
Senator Richard Shelby, R-Ala
Senator Michael Crapo, R-Idaho
Senator Bob Corker, R-Tenn
Senator Judd Gregg, R-NH
Senator Saxby Chambliss, R-GA
House
Rep. Barney Frank, D-Mass
Rep. Paul Kanjorski, D-Penn
Rep. Maxine Waters, D-Calif
Rep. Carolyn Maloney, D-NY
Rep. Luis Gutierrez, D-Ill
Rep. Mel Wat, D-NC
Rep. Gregory Meeks, D-NY
Rep. Dennis Moore, D-Kan
Rep. Mary Jo Kilroy, D-Ohio
Rep. Gary Peters, D-Mich
Rep. Collin Peterson, D-Minn1
Rep. Henry Waxman, D-Calif2
Rep. John Conyers, D-Mich3
Rep. Edolphus Towns, D-NY4
Rep. Nydia Velazquez, D-NY5
Rep. Spencer Bachus, R-Ala
Rep. Joe Barton, R-TX
Rep. Sam Graces, R-MO
Rep. Darrell Issa, R-Calif
Rep. Frank Lucas, R-Okla
Rep. Lamar Smith, R-TX
Rep. Ed Royce, R-Calif
Rep. Judy Biggert, R, Ill
Rep. Shelley Moore Capito, R-WV
Rep. Jeb Hensarling, R-TX
Rep. Scott Garrett, R-NJ
1 Chair, House Agriculture Committee; 2 Chair, House Energy & Commerce Committee; 3 House Judiciary Committee; 4 House Oversight & Government Reform Committee; 5 House Small Business Committee
CONTACT YOUR MEMBERS OF CONGRESS NOW.
Go to www.house.gov and www.senate.gov, to find all contact information.
AML/Cash Reporting News & Reminders
• When banks demand a copy of your AML Plan (or they’ll close your account), they usually give you only 2 weeks to comply. Heads Up: If they do close your account, any checks still outstanding will bounce. You may wish to limit writing checks on that account until you’ve met the bank’s requirements.
• Are you really wholesale only? If you consider yourself a wholesale-only dealer, and therefore exempt from Section 352 compliance, you should note that purchases from and sales to employees, friends and family will likely be considered “retail” transactions, not wholesale, and might necessitate your company’s compliance with Section 352.
Still so much confusion about different IRS regulations. Here’s a mini-recap:
• IRS/FinCEN – Form 8300. This is the form you report receipt of cash (and cash-equivalents like money orders and cashier’s checks) of over $10,000. You have 15 days to file.
• IRS Information Return – Form 1099b. This has nothing to do with cash payments. This is the form you use to report when you purchase certain precious metals commodity products (see “shopping list” on the ICTA website under Members Only section.) This form is filed at the end of the calendar year. While there is an exemption from filing if you are purchasing from a corporation, note that an LLC is NOT exempt.
• IRS Form #109 – SAR (Suspicious Activity Report). Coin dealers are not REQUIRED to file SARs but may wish to do so in certain circumstances. Check with your AML Plan’s policy or Plan provider before filing a SAR.
• CTR Form #103 – Currency Transaction Report. This is what the bank or other financial institution files. Coin dealers file an 8300, not a CTR.
Important Structuring reminder:
Most dealers know that structuring a cash transaction to avoid reporting is illegal. This is not just when you receive cash but also includes your deposits of cash into your own bank account. Example:
Dealer Joe had a number of cash transactions in his shop this week since many people were buying gold coins. He took in a cash total of $14,000. None of these transactions was related, and no 8300 forms were needed. Dealer Joe kept the cash on hand since he was going to a show that weekend, and he knew that he’d need cash to make purchases at the show.
While he was able to make some purchases at the show, most people wanted to buy, so he not only didn’t use up all the cash he’d brought, but wound up coming home with $5,000 more.
• Scenario I: On Monday morning, Dealer Joe decides he only needs to keep half of this on hand for making purchases in his shop. He prepares a deposit slip for the other half ($9,500.) and deposits that cash in his account.
This is perfectly OK. He is not structuring his transaction to avoid any reporting requirement.
• Scenario II: On Monday, he decides he only needs to keep $5,000 on hand and wants to deposit the other $14,000. But he remembers something about $10,000 in cash and decides to split up his deposit to $7,000. on Monday and he’ll deposit the other $7,000 the next day.
This structuring is not OK since it is for the purpose of avoiding reporting. In addition, by making the deposits on consecutive days, this triggers a reporting requirement anyway. He’ll be fortunate if the bank doesn’t report these 2 transactions as “suspicious.” Joe should just have deposited the whole $14,000. Having a form filed is no big deal, but he has now created his own problem!
If you believe that a customer’s transactions may be linked to terrorist activity, you should immediately call the Financial Institutions Hotline at (800) 556-3974. You may want to keep this number handy just in case. Let’s hope you never need to use it.
COMMODITIES AND TELEMARKETING INFORMATION FOR ICTA MEMBERS
ICTA member Cosgrove Law, LLC, specializes in compliance with state commodities codes and telemarketing regulations. They have compiled a 2-volume 50-state 500 page commodities legal survey which they update annually. This survey provides a comprehensive overview of the relevant portions of each state’s securities and commodities code and how precious metals retailers may be affected by them. This compendium is available to ICTA members at the special price of $2500 with annual changes provided at minimal cost.
Cosgrove Law is also updating ICTA’s Telemarketing Information Kit. If you would like a copy of the updated kit, contact Eloise. We will charge the usual $50 ICTA member price for the updated kit.
Cosgrove Law LLC can be reached at www.cosgrovelawllc.com or (314)563-2490. ICTA appreciates Cosgrove’s donation of the updated Telemarketing Information Kit.
Back to top^
ICTA’S BOARD WILL MEET IN BOSTON
ICTA’s summer Board of Directors meeting will be held on Wednesday, August 11, in Boston during the ANA World’s Fair of Money. The meeting begins at 6:45 PM and concludes by 10:00 PM. All ICTA members are welcome to attend but must contact Eloise to make a reservation (eloise.ullman@ictaonline.org or 410-626-7005). Each meeting participant pays an equal share of total dinner costs.
0
Comments
I knew it would happen.
I predict a massive selloff of PMs before the end of the year. I for one will be liquidating a bunch. Just getting to be too much hassle.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
I knew it would happen.
A preference for 2 day or less transactions in the financial bill would actually be a shot in the arm for coin shows.
Another thing this bill would make happen is rotation of everyone's gold holdings before 2012....specifically those where no invoice was ever received. This way fresh invoices would be in hand for all those going forward into 2012. Of course the little issue of paying capital gains earlier than anticipated could come into play. The same logic could be applied to anything numismatic worth over $600. Sell it now, then buy it back later with an invoice in hand. It will create a lot of extra metal sales for 2011.
roadrunner
Current status of H.R.5141
Write your Representative