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Although you may not be required to report silver purchases made from a precious metals seller, most businesses and organizations are legally responsible for submitting records of those transactions to the government. Some exemptions are mentioned below, along with the most typical requirements. Keep reading as the experts from First National Bullion and Coin, San Diego precious metals dealers with years of experience collectors can trust, explain what you need to know about reporting silver purchases.

Purity

Silver with a fineness of at least .999 is generally required to be reported to the IRS when sold. Each specific piece must meet those standards. If they don’t, sellers aren’t required to submit the sale on their tax forms. Due to inherent designs dictating the purity of silver coins, there are generally no purity restrictions. However, this will be based on the precious metal composition.

The reason for IRS rules and requirements are primarily for taxation purposes. The objective is to prevent sellers from using the silver as unreported income. The most common form to use when making this submission is Form 1099-B. However, if you’re a buyer and want to report the transaction, you can often use a Schedule D attached to Form 1040.

Quantity

The face value of silver typically determines if the bars, coins, and other types of silver need to be reported to the IRS. Most precious metals sold for more than $1,000 should be registered. The number of pieces sold must also be submitted, even if the dollar amount still needs to be reached. The precious metal composition will also make the qualifying quantity vary for silver bars and rounds, as mentioned with purity.

Large transactions, such as a sale of 1,000 ounces of at least 90 percent silver, are subject to being reported. However, based on new IRS regulations, these quantities can increase and decrease frequently. As a seller, it’s best to remain updated to avoid legal penalties, including costly fines.

Exclusions

A business may be exempt from disclosure if the transaction doesn’t meet or exceed the purity and quantity requirements mentioned above. Some specific silver coins are also optional to report, regardless of their sales quantities. One of the most common would be the Silver Eagle coin.

If you’re trading silver, paying taxes on the precious metal is necessary. However, some exclusions apply. For example, exchanging an ounce of silver could be given a pass and noted as a “kind exchange.” The terms of this exemption will vary, as will the quantities. Therefore, it would be best to speak with precious metal professionals or to reach out to the IRS directly.

Buyer Responsibilities

Although a buyer doesn’t necessarily have to report the transaction, any purchase over $10,000 is typically disclosed due to bank transfers or cash deposited by a precious metals dealer. In many cases, if a cashier’s check exceeds $3,000, the IRS requires most banks to submit a Monetary Instrument Report detailing the transaction.

To learn more about your silver disclosure requirements, speaking with specialists at a precious metals boutique would be best. These professionals can give you more insight on how to purchase and trade silver in terms of quantity and purity and exemptions you may receive. 

When they’re looking for the best place to buy silver bullion, San Diego residents should reach out to the trustworthy professionals at First National Bullion. We can answer all your questions and help you understand how precious metals can figure into your investment planning decisions. Give one of our experienced dealers a call today.

The statements made in this blog are opinions, and past performance is not indicative of future returns. Precious metals, like all investments, carry risk. Precious metals and coins may appreciate, depreciate, or stay the same in cash value depending on a variety of factors. First National Bullion does not guarantee, and its website and employees make no representation, that any metals for sale will appreciate sufficiently to earn the customers a profit. The decision to buy, sell, or borrow precious metals and which precious metals to purchase, borrow, or sell are made at the customer’s sole discretion.

By |2024-03-09T07:35:37-08:00March 18th, 2024|Miscellaneous|0 Comments