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In the spring of 2013, a California couple found eight half-buried jars of gold coins on their own property while walking their dog. The coins, in excellent condition, have a face value of $27,000, but because they are very old and rare the coins may bring $10 million at auction. According to a San Francisco Chronicle columnist, the couple might have tax worries. The complicated tax law, according to the columnist, may require them to pay their 2013 taxes (due April 15, 2014) based on the estimated value of the found fortune. But while the couple has a valuable new asset, they do not yet have cash for the tax man. We don't know how much income the family earns and we can't give tax advice, but the various state and federal tax laws could mean they'll have to pay state and federal taxes equaling just under half of $10 million--if that's what the coins are worth.

gold coins in cans

 

Photo: Kagin's/Kaginsinc.com

Comments  

#7 MsJenniWren 2014-03-09 17:34
Perhaps this is the lesson to all of us, that if we crow about our good fortune, we will lose half of it. How impossible, though, to make such a find and not tell SOMEone about it!
#6 Coinsmazm57 2014-03-07 02:23
Whether the coins were "stolen" or not, why should the state/fed govt take 'nearly half' in taxes when the coins are sold? Why punish the couple's good fortune? The taxman cometh!
#5 TaxesAlixz 2014-03-06 14:49
The IRS taxes all sales of what is considered personal property. If the coins are determined to be the personal property of the couple because they were part on the purchase of the land (both above and below ground) then the couple is required to pay taxes on the "fair market value" minus the basis (original value) of the coins. The "fair market value" being the price agreed upon by a willing seller and a willing buyer. This law applies to all sales of personal type personal use property including any profit made on houses and cars and furniture, etc. If you sell it for more than you paid for it, you have a taxable income.
#4 ownerlaadler 2014-03-06 03:02
This couple was not previously engaged in the business of buying & selling gold coins and should n-o-t have to pay tax, as such, as "inventory."
If and when the coins are sold, the appropriate % of tax would be paid at that time. The coins are only worth what someone will pay for them in re-a-l money.
What a scary article; is this still the USA?
#3 CoinsRAD4155 2014-03-06 00:40
I find it hard to believe that the couple would have to pay tax on the eventual auction value when the auction has yet to take place.
More likely, they might be taxed on the "face" value now, and will then have to pay further taxes (next year) AFTER the coins have sold.
By then, of course, they will have money in hand to pay the taxes.
No matter what, it's a lovely problem to have!
#2 May be stolen coins!norcalgal 2014-03-05 23:53
A story on Yahoo news March 4, 2014 said these coins may have been stolen from the U.S. Mint in San Francisco in 1900. The fact that they are uncirculated in mint condition and add up in face value to $27,ooo match a theft from the S.F. Mint in 1900. Records from the Mint from that era are retired to the National Archives & Records Administration, and access to the records is under their jurisdiction. I imagine some researcher will be looking for these records soon!
#1 Coinsedro3111 2014-03-05 23:17
In hindsight perhaps the couple should have been very covert and sold the coins under the table to collectors or dealers. The state and feds already rob us enough.

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