Are Capital Gains on American Eagle Coins Taxable?

American Eagle Gold and Silver coins are an easy way to make investments in the two types of precious metals. As with any kind of investment, the IRS will collect capital gains tax if you generate capital gains on your investment. Gains on collectible coins like American Eagles fall into a different category for capital gains taxes.

Producing a Capital Gain

You have a reportable capital gain on American Eagle coins if you sold coins you own and received a price greater than the price you paid for the coins. It is important to remember that there is not a taxable gain unless you sell your coins. If you owned the coins for one year or less, your profits will be classified as short-term gains. Owning the coins for longer than a year before selling puts the profits into the long-term gain category.

Taxes on Collectibles

American Eagle coins are classified as collectibles by the IRS. The long-term capital gains tax rate for collectibles is 28 percent. At the time of publication, other types of investments are taxed at a 15 percent rate for long-term gains. Short-term gains for all types of investments, including collectibles, are taxed at your marginal tax rate.

Reporting Your Gains

Unlike stocks in your brokerage account, there are no readily available -- or reported to the IRS -- records concerning when you bought your coins, what price you paid or when you sold coins. Coin and bullion dealers are not required to report purchases to the IRS except in certain circumstances. For coins, if you sold more than 25, the purchase would be reported. You report capital gains results from your own records on Schedule D of your tax return.

Keeping Accurate Records

Use your records of when you bought American Eagle coins and the prices you paid to match a cost with the money received from selling coins to accurately report your capital gains. There are no rules concerning which coins you should sell first, so if you want to minimize your current tax bill, sell coins for which you paid higher prices. Keeping a copy of your sales and purchase receipts allows you to answer questions that may come up regarding your taxes on the gains.

About the Author

Tim Plaehn has been writing financial, investment and trading articles and blogs since 2007. His work has appeared online at Seeking Alpha, Marketwatch.com and various other websites. Plaehn has a bachelor's degree in mathematics from the U.S. Air Force Academy.

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