Non-Reportable Bullion Coins
The terms non-reportable bullion coins and reportable bullion coins are used regarding investments by coin collectors of varying amounts. The purchases are categorized as such by the IRS when large purchases in cash are made, usually more than $10,000. In general the concern does not always focus on the types of coinage being purchased, but the amounts of precious metal in them which may raise the value of the purchase above the noted amount. In other words, there are certain "triggers" in purchases which the IRS seeks. There are certain coins, however, that are considered private purchase - those are American Eagle gold coins. These are considered non-reportable because they are backed by the government.
In 1933 the Roosevelt administration decided to call in gold in America and send it to the Federal Reserve to replenish the gold reserves. Consequently, owning gold in America was made illegal, and American citizens were forced to give up their 4th Amendment rights and give back the gold purchased. If the gold was not returned, citizens could face a 10 year prison sentence! The government loves to keep a close eye on the purchases of American citizens so that assets can be seized at any time and for reasons known only to them. Usually this happens in an emergency and during wartime. However, the government isn't known for following the rules. While government may think that money is the end all, there was a man in the Bible who thought he could purchase a gift from God. His name was Simon. Simon said "..Give me also this power, that on whomsoever I lay hands, he may receive the Holy Ghost. But Peter said unto him, Thy money perish with thee, because thou hast thought that the gift of God may be purchased with money. Thou has neither part nor lot in this matter: for thy heart is not right in the sight of God." (Acts 8:19-21 KJV).
The government is not concerned about purchases of gold or other precious metals, as stated above. Rather they track cash transactions that occur very regularly in large amounts (reportable bullion coins), and track these purchases through bank record keeping documents. If a collector buys currency for a purchase price of under the $10,000 mark, then the purchase, if gold, is stated as a purchase of non-reportable bullion coins. However, once the monetary threshold has been reached, the term "reportable bullion coins" is used. Ironically, if someone makes a purchase say of $12,000, and uses two cashier checks, each less than $10,000, the transaction does not need to be reported. However, if the transaction is done utilizing only one check for the full amount, then the transaction is reportable. However if the money is a personal check taken from a person's own account, this too is not considered a cash transaction. Therefore, private purchases of bullion using personal monies from personal accounts would not be considered as reportable bullion.
Now, there are instances of reportable bullion, when dealers are making purchases of a certain amount of metal. Purchases of 25 or more 1-oz coins with high quantities of precious metal would be considered reportable. Sales of certain coinage fall into this category, namely 1-ounce Gold Maple Leaves and Krugerrands from South Africa. When these transactions exceed the reportable amount, the IRS requires that the reporting be done on certain forms just for this purpose. In fact, the IRS has forms for almost every conceivable type of transaction reporting that is done. The forms contain boxes that ask the person completing the form to check if the transaction is considered to be a suspicious one.
Some investors trying to pump up the value of the precious metal currency which they sell give the buyer the impression that most gold bullion coinage is not subject to reporting, by describing them as "non-reportable bullion coins". As already described above, gold currency does not have to be reported, unless they are of a certain weight, number and kind. Investors will deliberately state "buy non-reportable American Gold Eagles". American Gold Eagles are always non-reportable. However, stating it in this manner can imply that at some point American Gold Eagles would be reportable. To the inexperienced collector, this may seem like a great deal, when in fact it is not. What this effectively does is to pump up the price artificially so that demand is raised in short order. This creates a demand pushing up the prices above what the coinage is worth. Therefore investors end up paying too much for the investment.
There are other types of non-reportable bullion coins and reportable bullion coins minted from other precious metals like Silver and Palladium. At this writing, Palladium has the highest market value per ounce, coming in at over $1900. Gold is at $912 per ounce, and Silver at only slightly less than $20 per ounce. When the Gold American Eagles are minted, a small amount of alloy is also mixed in, so that the coinage will not be too soft. Twenty-four karat gold is too soft to mint by itself. The added alloy makes the coinage stiffer. That is why the currency is considered approximately 91-96 percent pure. When a dealer states that a coin is one ounce of gold, the stated weight of gold does not include the added alloy. Therefore the piece will actually way slightly more than one ounce.
American Eagle gold pieces are suitable for investing in IRA's because they are backed by the United States government. These coins are easily sold on the market if need be in a short amount of time, so the investment is considered to be easily converted or fluid. Investors like this, because it doesn't take long to get money out of the investment. When this coinage is minted, it goes straight from the minting press into plastic sleeves, protecting the pieces from being marred. In this way the coinage remains in almost perfect uncirculated condition, which serves to increase their value. This is one reason investors enjoy collecting non-reportable American Eagle bullion coins. A careful investor will do the necessary research to ensure all gold, platinum or silver investments are properly reported or recorded, which secures the investment for the future.
Rare Gold CoinsIn order to obtain rare gold coins, there are some collectors who are happy to travel across even great distances. "But every woman shall borrow of her neighbour, and of her that sojourneth in her house, jewels of silver, and jewels of gold, and raiment: and ye shall put them upon your sons, and upon your daughters; and ye shall spoil the Egyptians." (Exodus 3:22). As a matter of fact, although most people would consider collecting to be just a hobby, many collectors are extremely serious about pursuing this as a financial investment as well. And despite the fact that many rare gold coins have been released onto the market after having been held by the leaders of various countries, the supply is still considered to be limited. By the way, the term numismatics is used to define the study and collecting of coins and medals. And numismatics comes from the Greek language: it means current coin. At any rate, numismatists, another term for collectors, have two major organizations assisting them in their pursuit. These organizations are the American Numismatic Association and the American Numismatic Society. Investors also seek guidance from what is known as the Redbook of Coin Values, which is endorsed by both these organizations.
First of all, the American Numismatic Association offers enthusiasts, among other things, educational course and seminars, and sponsors a national money show. Further, this association holds conventions in addition to maintaining a museum. Meanwhile, the American Numismatic Society's services include events and exhibitions as well as conducting research and educational opportunities. Also, the ANS makes the content of what is known as the world's best numismatic library available to people from around the globe. And too, the American Numismatic Society offers an outstanding collection to anyone wishing to study or just simply admire. At the same time, investors in rare gold coins consider the Redbook to be their bible and use it to help verify their worth as well as market price influences and explanations of the coin value's determination. Officially entitled the Redbook of Coin Values, this inexpensive book contains a pricelist for every recognized U.S. gold coin.
Those wishing to invest in rare gold coins should be aware that the only ones that are pure, and thus a good investment, are the antiques issued by the U.S. government. Because since they are certified by Congress, their weight has been given the stamp of approval from the government. Incidentally, it is good to know that there are two purchasing methods and the difference between them is the amount of the purchase. One can either buy rare gold coins or gold bullion. For the most part, gold bullion tends to be a bulk purchase rarely executed for collection purposes. Instead, gold bullion bulk purchases represent an investment in their accumulated worth. Whereas, in the case of rare coins, a professional recommendation concerning specific items is usually obtained. And according to experts, these investments perform better than any other asset, including stocks and bullion, even during times of economic turmoil.
Although of course other countries minted them, those from the U.S. are the most sought after by collectors around the globe. Primarily, this is because the quality of American gold coins is recognized world-wide as being higher. But despite the fact that millions of them were circulated from 1838 until 1933, there are relatively few currently in existence. Since the majority of the coins were melted by the U.S. government, less than 5% remain. And of this 5%, only very few are out on the market while the rest are either in museums or hoarded privately in numismatists' portfolios. So here is yet another reason these aesthetically pleasing gold coins will continue to be in such high demand. Because even though they come in different sizes, every single one of them is extremely valuable. Added to this is the fact that, within any collection, there are certain coins that are considered to be special. There are various reasons for this classification, as often as not because they have a great story behind them.
In order to locate the rare gold coins of their choice smart, sophisticated buyers first conduct a careful research into the matter. For instance, a person can examine dealers' websites, as well as those of auction houses, in addition to numismatic advertisements and marketing newsletters. Specifically, the savvy buyer aims for a relatively long-term purchase of the so-called right coin. Also, these well-informed buyers tend to be well-connected with a group of high quality, trustworthy dealers. For instance, inexperienced collectors may be unaware of the fact that beautiful coins need not be expensive. Furthermore, they may be of value simply because of their eye appeal, rather than a high grade of content. Speaking of which, it is also here that new-collectors benefit greatly from use of the Redbook because it contains thousands of detailed coin images and other help specially suited for beginners, such as investment advice.
Above all, one should only purchase rare gold coins that have been graded by a reputable, leading organization. The two that are in highest regard world-wide are the PCGS, Professional Coin Grading Service, and the NGC which stands for Numismatic Guaranty Corporation. A person should also bear in mind that many coins presented as being rare will turn out not to be rare at all. Therefore, the only reliable way to certify their value is through professional grading which guarantees its genuineness. So in conclusion, the benefits of collecting rare gold coins is both the acquisition of beautiful objects as well as the accumulation of excellent, very liquid assets that are also extremely easy to transport.