Gold coins
Whether you are a collector, or have a collection that has outgrown its usefulness, giving gold coins to charity can be a great way to help a worthy cause while reaping the tax benefits. The IRS has made it easy to donate a variety of gold coins to charitable organizations, and the process is as simple as mailing them in. If you have a large collection, you will probably need to arrange for delivery.
If you are a coin collector, you might consider donating some of your collection to an accredited numismatic museum. This type of donation allows you to take a tax write off, but also to be able to display your collection to visitors and fellow enthusiasts. In order to take the tax write off, you will need to attach a qualified appraisal, which substantiates the value of your gold.
Another way to take a tax write off is to donate a block of shares in a gold bullion ETF, or gold mining stock. These types of donations are based on the cost basis of the stock, not the market value on the day of the donation. Aside from the tax write off, you will also be able to spread the recognized gain over several years, and in some cases, you will be able to sell some of your shares in the future.
One of the more impressive tax write offs is the gift annuity, which allows you to donate a lump sum of gold to a charitable organization. This type of gift can be a great way to augment cash flow, and to be able to dispense with a volatile asset. You will need to find a trustworthy numismatic dealer to process your gift, and you will need to pay for an appraisal. In some cases, you will need to sign an agreement with the buyer to sell your gold over a period of time, which is also a tax write off.
Gold bullion
Whether you plan to donate gold bullion to charity or to a friend, there are several ways to take a tax write off. The first option is to invest with one of many precious metal IRA companies. You can sell a block of shares in a precious metals ETF, or you can sell a few gold coins in one year. These are all reasonable alternatives to giving gold outright.
Another option is to give gold bullion in exchange for a gift annuity. This allows a charitably-minded person to make a generous gift and to dispose of an asset that is volatile. You can also donate a gold mining company’s shares. If you donate shares, you’ll be able to claim a charitable deduction based on the fair market value on the date of the donation. This deduction is computed using the December discount rate.
If you plan to donate gold bullion, you should be aware that the IRS views bullion as collectibles. While you may be able to split your bullion into several pieces, some collectibles cannot be divided. These include proof sets, elongated coins, and gold coins encased in plastic. In these cases, you’ll have to arrange a sale with a reputable dealer. You’ll need to attach a qualified appraisal to the donation.
If you have a block of shares in a precious metallics ETF, you’ll need to file Form 8283. You’ll also have to make an adjustment to your inventory. This will take the donated asset out of your opening inventory. Then, you’ll need to enter into an installment sale agreement with the buyer. This way, you can sell some of your gold bullion in one year, and then sell the rest in the following year.
If you have a large quantity of gold coins, you may need to ship them to a dealer. Most people use registered U.S. mail to ship their gold, but UPS and FedEx will not. You should contact a qualified appraiser to determine the value of your gold.
Some people may find it more desirable to hold physical gold. However, many investors prefer to hold silver or exchange-traded funds (ETFs) that invest in gold bullion.