This Tax Tip Could Save You Thousands

Did you know the IRS taxes gold at a higher rate than securities? That's right. If you’re not careful, a huge percentage of your gains could end up going to the IRS when it’s time for you to retire.

But there’s a unique, perfectly legal, way around that. Today, we’ll show you some essential tips that could shield your gold and silver investments from thousands in taxes.

Plus, the incredible story of one man who sold his claim to one of the most gold-rich plots of land in the world for pennies. It’s all in this week’s Nuggets. Let’s get started!

How Much Credit Card Debt Do Americans Have?
According to Experian, the average American has an all-time high credit card balance of $6,501 – a substantial increase from $5,910 in 2022. More consumers are finding themselves dependent on credit, leading to a concerning trend: according to a recent Bankrate survey, nearly half of all cardholders (49%) are now caught in the cycle of carrying balances from one month to the next.

Interest Payments on National Debt to Surpass Medicare Spending
The Congressional Budget Office (CBO) says the U.S. government's net interest payments will soar to $870 billion in 2024. That means the interest on our debt will cost more than national defense ($822 billion) and Medicare ($851 billion). According to the Committee for a Responsible Federal Budget (CRFB), this places net interest payments as the second-largest line item in the budget, only outpaced by Social Security.

Let Them Eat Flakes
Chairman and CEO of Kellogg, Gary Pilnick, is under fire for suggesting on CNBC that struggling families should eat cereal for dinner. This comment came in the wake of a Wall Street Journal report highlighting that Americans allocate 10% or more of their income to food expenses. The comment didn’t land as intended. Many found the suggestion out of touch, as it trivializes the financial hardships faced by many, turning what is often a last-ditch meal choice into a questionable budgeting tip.

Bitcoin Climbs to $60,000, Nearing All-Time High
On Wednesday, Bitcoin soared past the $60,000 mark, revisiting prices not seen since the 2021 surge. Bitcoin is up roughly 19% over the week and 43% increase year-to-date. This rise is largely attributed to the growing enthusiasm surrounding the launch of several spot Bitcoin exchange-traded funds (ETFs) that hit the trading floors in January, sparking renewed investor interest.

Javier Milei Ends Argentina’s Deficit in Nine Weeks
In an impressive display of fiscal discipline, Argentina's Javier Milei has achieved the country's first monthly budget surplus in over a decade. How did he do it? Milei froze spending at 2023 levels, cutting many of the government agencies funding by over 50%. While a budget surplus is a significant achievement, Milei's ultimate challenge lies ahead in tackling the persistent issue of hyperinflation.

Our very own Alan Hibbard made a video on this earlier this week. Listen to his thoughts here.

How many protons are in the nucleus of every gold atom?

A. 36
B. 59
C. 61
D. 79

Scroll to the bottom for the answer...

The £10 Sale That Launched South Africa’s Gold Rush

While working on the farm Langlaagte, an Australian prospector named George Harrison (not that George Harrison) stumbled upon an outcropping of gold. Little did he know, this accidental find would kick-start the Witwatersrand Gold Rush and position Johannesburg as a cornerstone of the global gold market.

The irony? Harrison, failing to recognize the gold mine — quite literally — beneath his feet. Harrison allegedly sold his claim for a mere £10 and left for the goldfields of the eastern Transvaal region, unaware of the immense value of his discovery.

The gold rush that ensued after Harrison's discovery attracted prospectors from all over the world. Within a decade of the gold rush, Johannesburg became the largest city in South Africa, surpassing even Cape Town, which had been established over 200 years earlier.

The gold rush not only led to the establishment of Johannesburg as a major city but also significantly influenced the global gold market and the economic development of South Africa. Since Harrison's pivotal discovery in 1886, the Witwatersrand gold fields have accounted for more than a third of the world's total gold production, amassing over 48,000 tons of gold.

Despite the massive gold reserves and the deep mining operations, today South Africa’s gold mining industry faces several challenges. Many mines have become unprofitable due to declining gold reserves, with 75% of mines reported as unprofitable as of 2018.

Did you know that gold is not taxed the same as a security?

It’s actually taxed at a higher rate.

The IRS tags physical gold and silver with a capital gains tax, peaking at 28% for those long-term gains, regardless of your income bracket. Short-term gains? They're taxed at your ordinary income rate. And if you're dabbling in gold and silver ETFs or stocks, you should know ETFs match the 28% max rate for long-term gains, while stocks enjoy a leaner 20% cap.

Now, here comes the tax-savvy secret – Gold IRAs! These are your golden ticket to tax-efficient investing.

Understanding Tax-Deferred Accounts

Firstly, we have the traditional IRA and 401(k) accounts, known as tax-deferred accounts. These financial vessels allow you to postpone paying taxes on your investments until retirement. Moreover, you can reduce your taxable income each year with deductions for your contributions. It's like planting a seed today and only paying for its growth when you're ready to harvest.

On the other side of the coin, we find the Roth IRA. These are incredible tools for anyone eligible for its benefits. This account offers a remarkable advantage: the ability to make withdrawals completely tax-free during your golden years. The only potential drawback is that contributions to a Roth IRA aren't tax-deductible in the year you make them. However, this minor caveat is often overshadowed by the prospect of tax-free gains in the future.

Navigating IRA Transfers and Distributions

You easily rollover from a 401k, or transfer from an existing IRA – but they must be the same account type (individual to individual, etc.). This ensures a smooth transition of your assets, adhering to IRS guidelines.

And when it comes time to retire, you’ll have the option to take a cash distribution or a physical distribution.

• Take cash distribution = sell your metal holdings and be issued the cash from your IRA custodian according to your distribution amount when you're at the appropriate distribution-taking age.
• Physical Distribution = Take physical possession of your metals holdings equivalent to your distribution amount.

What you decide to do when that time comes is up to you. But at GoldSilver, we want to make sure everyone knows about the major tax benefits you’ll receive when you hold gold and silver in an IRA.

It’s also important to note: GoldSilver does not act as your IRA custodian. We work with some of the world’s top third-party custodians to safeguard your retirement accounts. This adds an extra level of security to your account.

Remember, folks, when it comes to tax season, the right knowledge can literally save you thousands. Let's make your gold investments work wonders for your future!

If you have any questions about opening a gold IRA, our dedicated client service team can help explain the process. Give us a call at 888-319-8166.

Buy Gold or Silver Today

If you’re intrigued by Alan’s research and are interested in diving deeper into the nuances of inflation, gold’s economic role, and more, we invite you to explore more on the GoldSilver YouTube channel.

That’s it for this week's edition of GoldSilver Nuggets. We'll be back with more news and updates next week! 

Best,

Brandon S.  
GoldSilver

How many protons are in the nucleus of every gold atom?

A. 36
B. 59
C. 61
D. 79

Answer – D. 79

Gold (Au) is a chemical element with the atomic number 79. This atomic number tells us the number of protons in the nucleus of an atom of gold. Therefore, every atom of gold has 79 protons.