With the prevalence of online precious metals dealers these days, people often wonder if they are required to pay sales tax on precious metals purchases, especially purchases made online. Here we will outline some information on this issue for informational purposes only. Nothing contained here should be construed as tax advice, and any questions relating to any tax matters should be directed to your CPA or tax adviser.
Whether or not one must pay sales tax on a precious metals purchase depends on where you are located. Some states require the collection of sales tax while others do not. Some states also may charge sales tax up to a point, and there may be exemptions beyond that point.
For example, a purchase of less than $1,000 may be subject to sales tax but above $1,000 may not be subject to the tax. It is important to also keep in mind that tax laws can change and, therefore, the information contained here is believed to be accurate, but no warranties are being made as to the accuracy. One should always conduct their own due diligence.
At the heart of the matter is whether or not gold, silver and precious metals should be viewed as an investment or even as a currency, or if they are simply just like any other physical property such as clothing, automobiles or furniture. Although it seems that the notion of gold, silver and other precious metals purchases being viewed as an investment and thus not be subject to sales tax may be gaining some traction, many states do, in fact, still charge sales tax on precious metals.
It is important, therefore, to determine if your state charges sales tax on precious metals. The best way to find out about your specific location is to consult your CPA or tax adviser. One can also look to your state’s department of revenue for answers regarding these issues.
Here is a basic guide that outlines some of the states and their policy on precious metals sales tax. For more information, you can view this helpful state by state breakdown.