If you’ve been watching gold prices over the last month, you’re aware that trading prices have fallen to historical lows. That leads to the obvious conclusion that this is a pretty bad time to sell gold.
But here’s a contrarian investment idea to consider. If you have gold that you don’t want to sell now, why not give it to your children? They can hold it for the long term and will probably have a good chance of selling it when prices increase in the future.
The Ins and Outs of Giving Gold to Your Children
You should speak with your tax preparer, accountant and attorney before giving your gold or gold recyclables to your kids. Our goal in today’s post is only to provide you with basic information about how the IRS views and treats gifts. Here are some of the rules you need to know, as explained on the Internal Revenue Service’s website.
How Does the IRS Define a Gift?
In the words of the IRS, a gift is “Any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money's worth) is not received in return.” In other words, you’re not selling anything – you are giving it away.
How Much Gold Can You Give Each of Your Kids?
The IRS states that the annual “exclusion” for 2015 is $14,000, meaning that you can give each of your children $14,000 worth of gold (or anything else) without having to pay gift tax. If you have two kids, you can give them each $14,000 worth of stuff, and so on. And if you and your spouse file separate returns, you can each give $14,000 to each of your kids – for a total of $28,000. But if the IRS investigates and finds that you gave a gift that is worth more than those amounts, you are going to have to pay penalties. (At least you, not your kids, will pay.) Again, you should review all these strategies with your tax preparers before moving ahead with your plans.
Do You Need Appraisals?
The IRS states that you don’t need to submit appraisals for gifts that fall below $14,000. But you should talk to your tax preparer about this. Even if the gifts you give are worth $14,000 or less, you’d be wise to have some documentation on hand that verifies those values, just in case the IRS asks questions. If you give us a call at 800-426-2344, we can help you determine and document the value of your gold and gold recyclables.
What about Giving Your Gold to Your Spouse?
Yes, you can. The IRS website says that “in general,” gifts given to a spouse are not subject to tax. But let’s say it once again - talk to your tax preparer before planning to give gold to your significant other.
Can You Give Recyclable Gold to Your Children?
Yes, you can. As the IRS states, you can gift just about anything to your kids in any calendar year, provided its value is $14,000 or less. Of course, the value of gold recyclables is a bit harder to determine than the value of gold bullion. That’s where we can help.
Let Us Help Determine the Value of Your Gold and Gold Recyclables
If the idea of gifting gold to your kids appeals to you, why not call us at 800-426-2344 so we can determine the value of your gold and gold recyclables and help you make a plan.
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