Reporting When You Buy from a Precious Metals Dealer
We are often asked whether or not bullion transactions at Allegiance Gold are “private.” The privacy of our customers is one of our primary concerns. When you buy from us, there are no reporting requirements of any kind when you buy through personal check or bank wire – no matter the quantity, the metal type, or the product.
As with other types of businesses, the overwhelming majority of precious metals transactions are conducted without any reporting requirement. However, dealers are subject to the anti-money laundering provisions under the USA Patriot Act enacted in 2001.
At Allegiance Gold we follow the law and have examined it very closely to be sure of our obligations. Under the law, precious metals dealers are not required to report your purchase of metals approximately 99.99% of the time, with one extremely rare exception.
For a disclosure requirement to be triggered, BOTH of the following conditions have to be met:
- The transaction is (or related transactions are) larger than $10,000 in size, AND
- Payment is made using actual cash (i.e. Federal Reserve notes and U.S. coins) or with two or more cash instruments (defined as money orders, cashier’s checks, or traveler’s checks) which, individually, are $10,000 or less but when totaled together equal more than $10,000.
Personal checks, debits, bank wires, and credit card payments are NOT considered cash or cash instruments, and therefore, purchases using them do not trigger disclosure by a dealer regardless of their amount(s).
The IRS disclosure document involved is called Form 8300, and it’s applicable to all cash transactions in the broad U.S. economy meeting the above conditions – not just precious metals transactions.
Reporting When You Sell to a Precious Metals Dealer
You might wonder why sales of these specific objects are reportable. These reporting requirements are related to the
regulations that require brokers to report all proceeds from stack and commodity
transactions. These specific objects are currently traded (or used to be traded) on commodity exchanges. Form 1099-B reporting requirements do not apply to any other coins. They do not apply at all to the following products:
And they apply only if you sell at least the minimum quantity that is equal to the quantity of a commodity contract for the object.
