The best gold move you can make in December
From Tom Dyson in The Palm Beach Letter:
You can turn your precious-metals loss into immediate tax savings without – technically – losing possession of the metals…
Regular Daily readers know we’d never consider selling gold or silver outright. This type of wealth insurance – called “chaos hedges” in our asset-allocation model – is a Palm Beach staple.
It stores value – in liquid form – for potential financial crises we hope we’ll never have.
But if your gold or silver coins have fallen in value, you’re in luck. We uncovered a tax move that allows you to benefit from falling gold prices without losing your gold…
IRS Code 1091 is known as the “wash-sale rule.”
It prohibits the repurchase of a security you sell for 31 days. If you want to claim a loss on the sale of a security, you cannot buy a “substantially identical” security within 30 days. The rule applies to stocks, bonds, options, funds, etc.
But the rule doesn’t mention precious metals. They’re not subject to a holding period for tax-swap sales.
Here’s how it works:
Let’s say you own gold coins purchased for $1,500 per ounce…
You go to a trusted coin dealer… sell them at current market price (about $1,150 per ounce)… then buy them back for the same price.
You realize a taxable loss in the transaction (which will lower your 2015 tax bill), but you still keep your metals.
You pay a fee for the transaction, but it should be less than your tax advantages.
Our preferred precious-metals dealer has been taking advantage of this “tax loophole” and transacting successful tax swaps for clients for more than 30 years. (Note: PBRG doesn’t receive any compensation from recommending our trusted precious-metals expert to you.)
Bottom line: Precious-metals tax swaps are a legal way to lower your tax bill while holding onto your metals. Look into them.
Crux note: Recently, Tom’s research team discovered a “throwback” tax loophole. It allows the owners of a unique type of account guaranteed, tax-free income… regardless of whether the stock market goes up or down. To learn more click here.