Sales Tax on Coins in NY

mrearlygold · January 10, 2011 1:37AM

If a collector buys 500K worth of coins in NY, does he pay sales tax?

TonedRarities · January 10, 2011 1:40AM

are they going out of state? If they are being purchased IN NY, they "should" legally have to pay sales tax

derryb · January 10, 2011 1:42AM

Not if they are gold coins:

Exemption for Certain Precious Metals

gyromac · January 10, 2011 1:43AM

if the coins are purchased in NYS, or from NYS dealer/NYS resident.....the answer is pretty much YES....

the only exception....over $1000 on STRICTLY bullion....not numismatic coins..

YogiBerraFan · January 10, 2011 1:45AM

If you walk into a place like Stack's in NY and purchase coins to carry out with you sales tax will be added. If you have them shipped and the address is out of state sales tax will not be added.

derryb · January 10, 2011 1:46AM

<< the only exception....over $1000 on STRICTLY bullion....not numismatic coins.. >>

Not according to the New York State Department of Taxation and Finance link provided above.

mrearlygold · January 10, 2011 1:50AM

So numismatics are taxes at 8.25% in NY for NY residents.

LOL

derryb · January 10, 2011 1:55AM

<< So numismatics are taxes at 8.25% in NY for NY residents.

LOL >>

Residency is irrelevant on all state sales taxes for in state purchases. If a Florida resident buys something while in New York he pays NY sales tax. If that same Florida resident orders something from NY for delivery to a non-NY address then he does not pay NY sales tax. However, such an out of state purchase may be subject to sales tax in the state that it is delivered to. It is up to the purchaser to be aware of and pay any taxes due to that state.

As a side note, Florida does not charge sales tax on coins. Probably a result of lobbying by the coin collecting retirement population (with some help from the dealers) located there.

mrearlygold · January 10, 2011 1:58AM

Hahaha one of these days I'm going to really retire ( yeah right ) and tell some stories. This is a good one. Hahaha.

gyromac · January 10, 2011 2:02AM

<< So numismatics are taxes at 8.25% in NY for NY residents.

LOL >>

varies from county/county.... some are as high as 8.75%....

at the $500K level....i would check the specific county rate

earlyAurum · January 10, 2011 2:02AM

I wouldn't buy directly from a NY business. In fact, it is cheaper to have a dealer buy it and then re-sell to a NY resident.

djdilliodon · January 10, 2011 2:10AM

That's why I always pay cash

. Most dealers in NY will not charge tax if you use cash.

mrearlygold · January 10, 2011 2:11AM

<< 

<< So numismatics are taxes at 8.25% in NY for NY residents.

LOL >>

varies from county/county.... some are as high as 8.75%....

at the $500K level....i would check the specific county rate >>

It's NYC.

In answer to the question about Fla.

Once upon a time we had a governor who decided that everybody would pay sales tax on coins and precious metals. A LARGE number of coins shops and businesses folded. Then came another governor who thougt that law was costing the state hundreds of millions of dollars in revenues and repealed those laws.

Biggest coin show in the country is in zee state of Florida now yes?

How long it will take them to screw it up remains to be seen.

gyromac · January 10, 2011 2:17AM

NYC tax rate = 8.875%

coindeuce · January 10, 2011 2:21AM

The SALES TAX exemption for transactions exceeding $1000 in N.Y. can be applied to all government created bullion composition coins that were not created by law for the intent of circulation, regardless of the nation of origin. These transactions must be documented with positive ID from the buyer however. I've had customers insist on paying the sales tax on an exempt, cash basis transactions where cash reporting was not an issue, simply because the paranoia about government confiscation prevailed in the buyer's mind.

gyromac · January 10, 2011 2:24AM

<< The SALES TAX exemption for transactions exceeding $1000 can be applied to all government created bullion composition coins that were not created by law for the intent of circulation, regardless of the nation of origin. >>

Republic of South Africa is NOT exempt....i.e. KRands

coindeuce · January 10, 2011 2:33AM

<< 

<< The SALES TAX exemption for transactions exceeding $1000 can be applied to all government created bullion composition coins that were not created by law for the intent of circulation, regardless of the nation of origin. >>

Republic of South Africa is NOT exempt....i.e. KRands >>

Better cite a law that pertains. You're wrong. S.A. bullion coinage IS exempt on sales exceeding $1,000. The abolition of apartheid and the resulting change in diplomatic relation between the U.S. and S.A. changed everything. The only restriction that ever applied to South African gold coinage was a U.S. moratorium on importation during the period in which S.A. resisted political pressure to abolish apartheid.

TwoSides2aCoin · January 10, 2011 2:38AM

NY has a lot of people. I visited there and bought two rolls of 2005 Lincoln cents in mint rolls back when I was there at local merchants where I'd stopped over and over until locating a new roll. I submitted three to PCGS. They came back Satin Finish.

EOM

johnny9434 · January 10, 2011 4:02AM

i think massachusetts is the same way. maybe more on the higher priced coins. ohio is the same way now

DuCrozat · January 10, 2011 5:35AM

<< That's why I always pay cash

. Most dealers in NY will not charge tax if you use cash. >>

They are responsible for the sales tax on their revenues.

Teva · January 10, 2011 5:51AM

I have passed on coins that I really wanted because of
sales tax. The only time my local B&M's charge tax is
if you use a credit card. Cash is king in the collecting world...
I hear some people have things shipped to out of state address
to avoid taxes not that I would ever advocate that kind of behavior.

BillJones · January 10, 2011 6:06AM

A number of states have the $1,000 rule where by any purchase of U.S. coins that exceeds $1,000 on a singe invoice is exempt from state sales tax. This law is even in effect in Massachusetts, which has the reputation of "Tax-a-chu-setts."

This is one more reason NOT to live in New York State or New York City. I worked in Manhattan as an intern at a company for less than a year while I was finishing up my MBA in the late 1970s. That year I had some experience with the New York State income tax and the NYC wage tax. The New York state income tax form form was very confusing, especially when you lived in New Jersey and worked in New York. Despite the fact that I had a degree in accounting, I still got it wrong.

New York is one rough state in which to live, and I'm now glad that I never landed my "dream job" in Manhattan.

oreville · January 10, 2011 7:56AM

BillJones:

Indeed back in the 1970's and early 1980's New York and New Jersey had the worst non-reciprocity tax filing forms in which they practically fought each other over the taxation of NY residents working in New Jersey. The New Jersey Emergency Transportation Income Tax return plus the NJ Income tax return. It was awful. It was a special non resident NJ income tax return that mimicked the much higher NY State Income tax rates. It was finally declared unconstitutional by the NEW JERSEY Supreme Court back around 1984.

Things have improved a little since then except New Jersey really mistreats their own residents now whereas New York has actually lightened up a little on their residents since then.

coindeuce · January 10, 2011 8:37AM

<< A number of states have the $1,000 rule where by any purchase of U.S. coins that exceeds $1,000 on a singe invoice is exempt from state sales tax. This law is even in effect in Massachusetts, which has the reputation of "Tax-a-chu-setts." >>

Bill, I don't know the exact provisions of other states laws, but in N.Y. the sales tax exemption is applicable only to coins that are regarded by the IRS & N.Y. State as commodity based. One cannot purchase Proof American Eagles of any composition or Proof Gold Buffalos within N.Y. state without being subjected to N.Y. sales tax since these are officially regarded as collectibles.

derryb · January 10, 2011 8:49AM

I'm always amazed by the continued, differing opinions on a topic even after the actual rules are linked early in the thread (in this case, gold coins and the ruling from the New York State Department of Taxation and Finance). Supports my theory that most people just read the first and last post and then throw in their two cents worth. Here's the NY rules again, catch them before they get buried between the first and last post!

Exemption for Certain Precious Metals

BillyKingsley · January 10, 2011 11:20AM

Honestly, I'm surprised they don't tax the air we (try) to breate yet.

I could really start ranting about this but it would likely get me banned

coindeuce · January 10, 2011 11:41AM

<< I'm always amazed by the continued, differing opinions on a topic even after the actual rules are linked early in the thread (in this case, gold coins and the ruling from the New York State Department of Taxation and Finance). Supports my theory that most people just read the first and last post and then throw in their two cents worth. Here's the NY rules again, catch them before they get buried between the first and last post!

Exemption for Certain Precious Metals >>

And I'm always amazed at how some people can try to make a point in a discussion by linking to internet information that is obsolete, which is in effect the perfect storm of misinformation. Try reviewing the CURRENT provision of the N.Y. law as it applies to the status of South African gold coins. And I reiterate my statement about the U.S. Mint issues of PROOF bullion coins, i.e, Eagles and Buffalos. They are never exempt from sales tax in N.Y.

derryb · January 10, 2011 12:19PM

<< And I'm always amazed at how some people can try to make a point in a discussion by linking to internet information that is obsolete, which is in effect the perfect storm of misinformation. Try reviewing the CURRENT provision of the N.Y. law as it applies to the status of South African gold coins. And I reiterate my statement about the U.S. Mint issues of PROOF bullion coins, i.e, Eagles and Buffalos. They are never exempt from sales tax in N.Y. >>

Your "current" link only removes the restriction previously placed on South African coins that were restricted in the "obsolete" link. With that amendment the "obsolete" link still stands as NY State Tax law. Paragraph (27) of current NY Tax law waives sales tax on investment purchases of more than $1000 in precious metals bullion, including coins. This exempts purchases greater than $1000 of American Eagles and other bullion coins. Here is the actual wording from the CURRENT tax code:

NY Code - Section 1115, Exemptions from sales and use taxes:

(27) Precious metal bullion sold for investment, provided that (i) the
retailer, if so required, is registered pursuant to section three
hundred fifty-nine-e of the general business law and (ii) the receipt or
consideration given or contracted to be given for such bullion depends
only on the value of the metal content of such bullion. "Precious metal
bullion" means bars, ingots or coins of gold, silver, platinum,
palladium, rhodium, ruthenium or iridium, but shall not include bars,
ingots or coins which have been manufactured, processed, assembled,
fabricated or used for an industrial, professional, esthetic or artistic
purpose. Precious metal bullion shall be deemed to be sold for
investment when it is sold for more than one thousand dollars and the
purchaser or user or agent of either of them holds it in the same form
as when it was purchased and does not manufacture, process, assemble or
fabricate such bullion for its own use. For purposes of this paragraph,
the receipt or consideration given or contracted to be given shall be
deemed to depend only on the value of the metal content if, at the time
of sale or purchase at retail, such receipt or consideration does not
exceed (i) one hundred forty percent, with respect to silver coins, or
(ii) one hundred twenty percent, with respect to gold coins weighing
one-quarter of an ounce or less, or (iii) one hundred fifteen percent,
with respect to other coins, of the greater of (A) the daily closing
bullion cash price of such metal in the open market or (B) the coins'
face value at prevailing rates of exchange, or (iv), with respect to
bars and ingots, one hundred fifteen percent of such bullion cash price
of such metal. Where there is no such closing price for such metal, the
average of the bid and asked cash prices shall be substituted for such
closing price.

coindeuce · January 10, 2011 12:29PM

derryb - you can quote the code as much as you want. It still does not exempt collectible coins, which includes the Proof issues of American Eagle and American Buffalos. Nor does it exempt collectible Proof issues of bullion coins originating from any other nation, i.e Proof Sovereigns, Proof Nuggets, Proof Pandas.
Read Tax Bulletin ST-740, issued 6/17/2010 which clarifies my point that items sold for purposes other than A MEDIUM OF EXCHANGE are taxable.

derryb · January 10, 2011 1:00PM

With all due respect I believe you are confusing the federal tax law on collectibles with NY sales tax law. Federal tax law does not apply to NY state taxes unless NY specifically invokes a federal statute or definition from the federal tax code. There is no use of the word collectible in the NY bullion sales tax language and no reference to federal tax code. NY however, does apply sales tax to gold coins purchased for "industrial, professional, esthetic or artistic purposes." It can be safely argued that an investor is not buying gold eagles for any of these purposes. On the other hand if a dental lab were to purchase gold eagles for use in fabricating 22K gold dental appliances then the eagles would be subject to sales tax. In addition federal tax law on collectibles is an income (profit) tax issue while the issue on the table here is NY state sales tax.

Your reference to ST-740 further proves my point in the section headed "Tax exempt property and services." In this chart you will find "Precious metal bullion sold for investment" in the left column. From there it sends you to my "obsolote" link, TSB-M-89(20)S, as amended by your "current" link, TSB-M-95(9)S, only to remove the restriction on South African bullion. Furthermore the last paragraph of your link TMB-M-95(9)S clearly keeps my link TSB-M-89(20)S active, with the exception of the South African coins.

ScarsdaleCoin · January 10, 2011 1:10PM

so all those dealers who make sales at coin shows without collecting tax and who dont have a tax number are

1. Revolting against taxes like the Boston Tea Party

2. Just dont care

3 Collecting tax and pocketing it?

PS: dont get me started about how they buy gold at shows without a license, without a registered scale and without filing nor regarding hold laws....

and folks wonder why all the b/m stores have closed

derryb · January 10, 2011 1:13PM

Hey, I'm just telling you what NY sales tax law states. How it gets interpreted is between the interpreter and the judge.

derryb · January 10, 2011 1:20PM

<< if the coins are purchased in NYS, or from NYS dealer/NYS resident.....the answer is pretty much YES....

the only exception....over $1000 on STRICTLY bullion....not numismatic coins.. >>

Gyromac said it best and it only took him two lines of typing!

coindeuce · January 10, 2011 1:30PM

<< 

<< if the coins are purchased in NYS, or from NYS dealer/NYS resident.....the answer is pretty much YES....

the only exception....over $1000 on STRICTLY bullion....not numismatic coins.. >>

Gyromac said it best and it only took him two lines of typing! >>

Apparently our only difference of opinion regards the definition of what is strictly bullion and what is numismatic property as it pertains to sales tax / exemption in N.Y. My opinion remains unchanged.

gyromac · January 10, 2011 1:32PM

<< 

<< if the coins are purchased in NYS, or from NYS dealer/NYS resident.....the answer is pretty much YES....

the only exception....over $1000 on STRICTLY bullion....not numismatic coins.. >>

Gyromac said it best and it only took him two lines of typing! >>

thanks derryb.....i have often been asked why i only have a few posts since being here since 2006.....this thread is the classic reason why.....

a fellow member asks for help with a question....members offer their best help (which is what the board was designed for)....the answers get more and more technical....then a minor "match" ensues....you try to be helpful....get crucified b/c you don't know every detail, bullet, fine point...it is just not worth it....

but i stand by my first answer....

derryb · January 10, 2011 1:34PM

<< Apparently our only difference of opinion regards the definition of what is strictly bullion and what is numismatic property as it pertains to sales tax / exemption in N.Y. My opinion remains unchanged. >>

I would argue before the judge that the NY tax law specifically exempts bullion coins, the US mint promotes and sells them as bullion coins and I most definitely bought them as bullion coins.

taxmad · January 10, 2011 1:36PM

TSB-M-89 (20)S is still valid, with the amendment simply adding Suid Afrika coins to the definition of bullion. Buying of bullion in amounts over $1000 for investment purposes is exempt. All ASE's & AGE's will fail the definition (sold for over the listed percentage of face value), so in order to buy tax free the premium over melt must be less than 40% for silver, 20% for gold with 1/4 oz AGW or less and 15% for coins greater than 1/4 oz AGW. Buying a 2008 W $10 AGE will be subject to tax, as the purchase price exceed the face value and/or the bullion content by great than 120% (the threshold in the bulletin). A pair of $25 AGE's for $1500 will qualify, as the premium of $130 is 9.5% above spot.

The conversion of investment bullion into personal use triggers a use tax. So if you are audited, make sure you are not wearing your 5 oz ATB pucks in a bezel around your neck...

taxmad · January 10, 2011 1:42PM

<< 

<< 

<< if the coins are purchased in NYS, or from NYS dealer/NYS resident.....the answer is pretty much YES....

the only exception....over $1000 on STRICTLY bullion....not numismatic coins.. >>

Gyromac said it best and it only took him two lines of typing! >>

Apparently our only difference of opinion regards the definition of what is strictly bullion and what is numismatic property as it pertains to sales tax / exemption in N.Y. My opinion remains unchanged. >>

The bulletin defines a bullion coin if it trades for less than a certain percentage above melt. A cleaned $20 Liberty gold piece that you pay 3% over melt for would qualify for tax exempt purchase, but the MS64 1891 CC $20 Liberty gold piece for $20,000+ would be subject to tax. It appears in addition to the invoice total, New York has applied an arbitrary premium percentage as the deciding factor i.e bullion versus numismatic.

Hope that helps

ScarsdaleCoin · January 10, 2011 1:54PM

Bouillon is tax exempt coin.... I thought it was a soup

coindeuce · January 10, 2011 2:05PM

taxmad - your citations above simply reinforce what I stated earlier about the distinction between what is strictly a commodity used as a medium of exchange, and what is a numismatic property as a collectible. Unfortunately, the interpretations for either have changed in recent times as a consequence of the rapid rise in the precious metals market. There was a time when even a cleaned, XF $20 Lib. had a market premium that exceeded bullion value by a percentage that kept it in the classification of numismatic property.

Sales Tax on Coins in NY

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