When selling your gold back to a dealer, tax implications will depend on two basic questions:

1. What form of gold bullion are you selling?
2. What amount?

Whether or not a dealer reports the transaction to the IRS via a 1099 form will depend on whether the bullion you are selling is considered 1099 Exempt, or 1099 required. While exempt bullion can be in any quantity, required bullion consists of 25 oz. or more sold.

1099 EXEMPT BULLION

• American Gold Eagle Coins
• American Gold Buffalo Coins
• Gold Austrian Philharmonic Coins

1099 REQUIRED BULLION

• Canadian Gold Maples
• South African Krugerrands
• .999 Fine Gold Bullion Bars

CAPITAL GAINS TAX

Gold in any form is considered a “collectible” by the IRS, along with other physical metals, vintage wines, stamps, artwork and antiques.

This means that any profits made from selling gold jewelry, gold exchange-traded products (EFTs) and other precious metal investments are subject to capital gains taxes at a 28 percent rate, provided you’ve held the asset for more than a year. If it has been less than a year, gains are called short term capital gains and are taxed at an ordinary income rate.

So for every $100 of profit that you incur from your investment, say if you buy a gold chain for $100 and sell it for $200, then you’ll owe $28 to the IRS as a result of that profit. This is something that needs to be taken into consideration if you’re planning to invest in gold.