House proposes repeal of Section 1031 “Like-Kind Exchanges” for bullion investments

Washington, D.C. — Last week, House Republicans released their tax reform bill, which includes a major change to Section 1031 or “Like-Kind Exchanges.” Currently, Section 1031 defers the taxation of gains on the exchange of property as long as the property is held for productive use in a taxpayer’s trade or business. This allows for the gains made on old property to be invested in new property.

However, the bill modifies Section 1031 to only apply to “real property,” thus excluding investments in personal property such as precious metals coins and bullion from the U.S. Mint. In the view of the Precious Metals Association of North America (PMANA), this is an anti-growth provision that will hurt jobs and, in turn, weaken our economy if signed into law — in other words, forcing taxpayers to recognize a gain on continuing investments that support economic growth is bad for the economy.

“While some wrongly label this as a tax shelter, the reality is quite different,” said Scott Smith, president of PMANA. “Section 1031 promotes economic growth because it allows taxpayers to redeploy capital and generate much-needed revenue for the U.S. Mint. When the U.S. Mint generates revenue and increases production, the benefits trickle down the precious-metals supply chain to manufacturers, recyclers, and refiners,” Smith continued. “In the end, Uncle Sam should not punish responsible investors for making smart decisions that support families and the economy,” he said.

In the coming days, PMANA will be meeting with key members of Congress to restore Section 1031 personal property investments in the tax reform bill.

Press release courtesy of the Precious Metals Association of North America.

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  1. KEITHSTER says

    Soon as they find a way to tax the air we breath they will! And that will be sooner than most gains on mint products? Now if we could claim the loss on mint products they maybe on to something? Well Good Luck All:>”>”>:<

  2. cagcrisp says

    Scott Smith, president of PMANA said “Section 1031 promotes economic growth because it allows taxpayers to redeploy capital and generate much-needed revenue for the U.S. Mint.”

    I have a hard time following that logic for Current U.S. Mint products. Past U.S. Mint products, Possibly I can see. Current is a Stretch and for Bullion investments (as the title of this article implies ) would be virtually non existent.

    My Guess is that 90+% of All 1031 exchanges are currently real estate in nature and what few would actually apply to Numismatic coins would be at the Very Top End of the range and I don’t see any Very Top End of the range coins being cranked out Currently from the U.S. Mint so I don’t see how that will affect mintage of U.S. Bullion coins for anyone other than the APs…

  3. MarkInFlorida says

    Back when gold was cheap, around $300 an ounce, I bough a bunch of British sovereigns for around $75 each, and many years later, when gold was going over $1000 an ounce I could use them at coin shows to trade for current gold eagle proof sets, silver eagle rolls, etc., instead of selling them at a profit, and paying cash. I considered them tax-free 1031 exchanges.

  4. Just Another Dave In Pa says

    Been looking at the Paradise Papers and if anything needs to be reformed, it’s the off-shoring of wealth.

    The economy and the tax policies in this country are of the wealthy, by the wealthy and for the wealthy.

    It’s bi-partisan, too.

  5. ike says

    I still can’t get my US Mint order history. Are other people still having this problem? I have tried deleting history, cookies and all other browsing history—-still order history is not available.

  6. Louis says

    Mu local dealer has customers who bring in a lot of silver bullion and trade it for gold eagles of the same value. I don’t think this repeal would have any impact on that kind of thing if I understand correctly.

  7. cagcrisp says

    @Louis, the Proposed repeal would include all personal property. Under your example there would be a taxable event selling the Silver bullion and you could not defer taxes by buying the Gold eagles…

  8. Throckmorton says

    @cagcrisp…what if Louis had bought the silver with an IRA and the swapped for the gold? That might still be a tax deferred profit.

  9. KEITHSTER says

    Yup no order history today the refresh used to work for a while but not now? Customer service well that never did! Live chat uh uh ! Did get the survey and got to tell them twice to get it fixed. So if everyone gives it a try well maybe? Still think it’s hackers as that would make since/ Russians?don’t suppose but Good Luck Mint And All :>:>:>:>:>:>”>”>”>”>”>

  10. cagcrisp says

    @Throckmorton, Nothing is ever taxed in an IRA until it is taken out of an IRA. Anything coming out of an IRA is ordinary income and not subject to benefits of capital gains…

  11. cagcrisp says

    17XA 2017 AM LIBERTY 24K GOLD 1 OZ 25,845 +170
    17XB 2017 AM LIBERTY SILVER MEDAL (P) 49,993 + 638
    17XC 2017 225TH ANN ENHANCED UNC SET 210,789 + 304
    17XD 2017 AM LIBERTY SILVER 4-MEDAL SET 26,276 + 536

  12. cagcrisp says

    16AN 2016 ATB SILVER UNC 5 OZ – FT MLTR 17,643 + 15
    17AJ 2017 ATB SILVER UNC 5 OZ – EFF MNDS 16,083 +34
    17AK 2017 ATB SILVER UNC 5 OZ – DOUGLASS 16,149 + 46
    17AL 2017 ATB SILVER UNC 5 OZ – OZARK 15,629 + 82
    17AM 2017 ATB SILVER UNC 5 OZ – ELLIS ISLAND 16,644 +137

  13. cagcrisp says

    16XA 2016 WALKING LIBERTY 24K GOLD .5OZ 64,638 + 40
    16XC 2016 STANDING LIBERTY 24K GOLD .25OZ 90,560 + 50

  14. cagcrisp says

    16EA 2016 AM EAGLE SILVER PROOF 1 OZ 575,069 + 333
    16EB 2016 AM EAGLE GOLD PROOF 1 OZ 23,791 + 3
    16EC 2016 AM EAGLE GOLD PROOF 1/2 OZ 5,773 + 3

    16EG 2016 AM EAGLE SILVER UNC 1 OZ 208,627 +99

  15. cagcrisp says

    17EA 2017 AM EAGLE SILVER PROOF 1 OZ 329,096 +2,920

    17EB 2017 AM EAGLE GOLD PROOF 1 OZ 6,979 +71
    17EC 2017 AM EAGLE GOLD PROOF 1/2 OZ 1,822 +42
    17ED 2017 AM EAGLE GOLD PROOF 1/4 OZ 2,921 +82
    17EE 2017 AM EAGLE GOLD PROOF 1/10 OZ 11,163 +5
    17EF 2017 AM EAGLE GOLD PROOF 4-COIN SET 9,102 +127

    17EG 2017 AM EAGLE SILVER UNC 1 OZ 128,349 +627

    17EH 2017 AM EAGLE GOLD UNC 1 OZ 5,800 (53)

    17EJ 2017 AM EAGLE PLATINUM PROOF 1 OZ 8,893 (42)

    17EL 2017 AM BUFFALO GOLD PROOF 1 OZ 14,131 125

  16. cagcrisp says

    17CA 2017 BOYS TOWN GOLD PROOF 1,439 +4
    17CB 2017 BOYS TOWN GOLD UNC 2,232 + 23
    17CC 2017 BOYS TOWN SILVER PROOF 24,081 + 121
    17CD 2017 BOYS TOWN SILVER UNC 10,071 +29
    17CE 2017 BOYS TOWN CLAD PROOF 16,558 +57
    17CF 2017 BOYS TOWN CLAD UNC 14,390 +42
    17CG 2017 BOYS TOWN 3-COIN SET 5,184 +17

    17CH 2017 LIONS CLUBS SILVER PROOF 65,715 + 129
    17CJ 2017 LIONS CLUBS SILVER UNC 16,619 + 20

  17. cagcrisp says

    JQ1 2015 FS GOLD PROOF 1/2 OZ – TRUMAN 2,720 + 3
    JQ2 2015 FS GOLD UNC 1/2 OZ – TRUMAN 1,916 (1)
    JQ4 2015 FS GOLD UNC 1/2 OZ – EISENHWR 2,067 +1
    JQ6 2015 FS GOLD UNC 1/2 OZ – KENNEDY 6,771 –
    JQ8 2015 FS GOLD UNC 1/2 OZ – JOHNSON 1,856 –

    16SA 2016 FS GOLD PROOF 1/2 OZ – NIXON 2,606 +3
    16SB 2016 FS GOLD UNC 1/2 OZ – NIXON 1,695 –
    16SC 2016 FS GOLD PROOF 1/2 OZ – FORD 2,425 + 4
    16SD 2016 FS GOLD UNC 1/2 OZ – FORD 1,674 –
    16SE 2016 FS GOLD PROOF 1/2 OZ – REAGAN 3,470 +8
    16SF 2016 FS GOLD UNC 1/2 OZ – REAGAN 1,938 + 1

  18. Buzz Killington says

    1031 Exchanges in general are a positive, because they encourage more efficient use of assets, and discourage holding onto an asset just in order to avoid a tax bill.

    I have never heard of this being done for anything but real estate. You would have to be selling a HUGE amount of Mint product for this to be a real variable. That being said, although I don’t really understand how such an exchange would work with personal property, the reasons for having a 1031 seem to apply equally to each.

    I will say that I would not want to be one of the people paying a lobbyist for this kind of project — practically speaking, there has to be an impossibly small number of people trying to do 1031 exchanges for US Mint products — which, as others have pointed out, have done their best to save our tax bills by not appreciating at all.

  19. Achmed says

    It will be interesting to see how the sales number for the AGE 2017 uncirculated changes during the coming weeks. As the mint states this coin is sold out what will happen to the 53 coins that have come back last week?

  20. johnaz says

    I think the 2017 silver proof sets are return,They have them for sale two or four day apart, and only a few.

  21. KEITHSTER says

    Only one way for it to go now down on the mint side and up on the bay side then buy the wayside? Should a would a Good A Luck All:)

  22. KEITHSTER says

    Got the order history to work again doubt it was any thing I did but did hit the refresh button a few times to keep the Order History words dark till it popped up ? And that thingy on the survey yesterday to get it fixed? Made sure to print this time not that that will cover it but it should cover it in court to show I paid too much !? Well Good Luck All:”>”>”>”>”>”>

  23. earthling says

    If only I could access my Order History from about 2000 and onward. I have soooooo many sealed unopened Boxes…. and I have no idea whats in them. I could open them but then … any premium is gone.


  24. Joe M. says

    @ earthling
    Try putting in the code that’s on the box(2 letters and 2 numbers) in google search…
    example… US Mint 17XC, or US Mint 17RC.
    That should come up with the product so you don’t have to open the boxes.

  25. John Q. Coinage says

    Welcome to the new CORPORATE economy, as DAVE IN OA says the offshoring of $ is a big deal & Se. of Tresury Muhckin is a thief who enabled the richy rich to avoid taxes, he DID NOT DENY IT; there is no evidence of trickle down EVER working, he & Trump believe it I guess, riddle me this—> Corp’s pay an acknowledged actual average rate of about 19% (if that APPLE pays as an Irish Co. WTF!) with the 35% rate, @ the new 20% they will pay what 6% in taxes, we the people get a hot rod up our.. this is such a sham, middle class even get some tax increases & the elimination of the Estate Tax will help everyone, oops those with a 12M$ estate, who alreasdy avoid it. Our founders made a ‘death tax” to avoid a royal elite Class, Trump, Muchkin, et all, ARE TH E “elite” (financiall not intellectually nor honestly) class & we are paying for their & corp. tax cut, Corps used to pay 25% of the toal US Tac revenue, down now to 12% with INDIVIDUALS picking up the balance. And don’t get me started on writing off local taxes, the goobers in low tax states take alot more in benefits then they pay in CA & NY pay a bulk of Fed tax but get back a much lower % on the money WE Pay t o the tresury. CA must raise food prices @ the grower level…..

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