Posts Tagged ‘capital gains’

Precious metals ETFs, update

Monday, December 7th, 2009

A little over a month ago I put up a short post on how gains in a precious metal ETF might be taxed at the collectible rate of 28% instead of the normal long term capital gain rate of 15%. I said I would dig around to see if I could find more on it.

The IRS Office of Chief Counsel issued a memorandum in May 2008 stating that, generally speaking, metals-based ETFs are treated as if the shareholder held the metal itself. In other words, the 28% tax applies.

Something to keep in mind if you are considering taking profits on those GLD shares that have shot up and (recently) down.

Gold and Silver ETFs taxed as collectibles at 28%

Thursday, October 29th, 2009

Something I hadn’t known:  Gold and Silver Exchange Traded Funds (ETFs) are taxed as collectibles.  That means that if you hold the shares for more than a year, the capital gain you realize when you finally sell them would be 28%.

Ouch.

But, apparently, you can hold those funds in a traditional IRA and avoid all this.  I’m going to dig around the IRS publications and guidance to get the story from the horse’s mouth, but here is a helpful link:

http://moneygirl.quickanddirtytips.com/money-golden-egg.aspx