Your capital gains tax rate corresponds to your income tax category and can range from zero to 20%. If you sell your jewelry for a price lower than its fair market value, this is considered a loss of capital. If you owned the jewelry you sell for more than a year, you pay a long-term capital gains tax. The tax rate will be 0, 15, or 20 percent, depending on your marital status and taxable income.
Additionally, if you are considering converting your IRA to gold, you should be aware that the capital gains tax rate may apply. According to the IRS, these items are capital assets. Capital asset gains are taxed at different rates depending on a number of factors, most importantly, income. However, most consumers who sell their jewelry don't benefit from the sale. They can receive money but not make a profit.
Therefore, since there are no profits, the tax liability is nothing. If you made significant profits from selling jewelry, you are required to declare it and pay the taxes associated with the capital gain from that asset. Again, because most consumers don't make a profit when they sell their jewelry, so there's no tax obligation. When you keep something more than a year before you sell it, any profit you get from selling it is a long-term gain.
Most assets, such as stocks and bonds, are subject to a maximum long-term profit rate of 20 percent. According to the IRS, collectible items such as gold and gems face a special long-term capital gains rate of 28 percent. If your normal income tax rate is lower than 28 percent, your ordinary income tax rate applies instead of the 28 percent rate. That's why it's important to check with your certified public accountant about taxes on your investments in gold.
