Do I Need to Report Gold to the IRS? FBAR and Form 8938

Are you required to report gold to the IRS? Surprisingly, the answer is no. Gold you hold directly is not reportable on the FBAR or IRS Form 8938. But be careful…when you sell the gold, you have a reportable transaction.So, in most cases, you are not required to report gold to the IRS!

You hold gold directly if you own gold bars, gold bullion or coins and keep them in a vault. It doesn’t matter whether that vault is inside the U.S. or somewhere secure like Panama. You do not hold gold directly if you own a gold certificate, gold stocks, or a gold future contract. Only physical gold that you have direct access to is allowed to be private. For additional information, see the IRS website.

I note that your IRA can hold gold bullion directly, and that gold can be held in a foreign vault. Many of our clients form offshore IRA LLCs to hold this type of asset. In that case, your administrator must report the appreciation in the IRA account, but are not required to file an FBAR or IRS Form 8938.

The same holds true for tangible assets that you buy as investments. Examples of tangible assets include art, antiques, jewelry, cars and other collectibles. If you hold these assets outside of the United States, you are not required to report them on your FBAR or IRS Form 8938. Note that an IRA may not own art, antiques, jewelry, cars or any type of collectible

Finally, you are not required to report the existence of a safe deposit box at a foreign bank. A safe deposit box is not a foreign account and is thus not covered by these forms. If your safe deposit box has only gold and jewelry, then you have nothing to report.

Now, here’s the rub: If you sell your gold or tangible property to a foreign person, that sales contract is a reportable asset. According to the IRS, “The contract with the foreign person to sell assets held for investment is a specified foreign financial asset investment asset that you have to report on Form 8938, if the total value of all your specified foreign financial assets is greater than the reporting threshold that applies to you.”

Therefore, if you sell your gold and collectables to a U.S. person, no reporting is required. If you sell these same assets to a foreign person, and the total value is significant, you must report the transaction on IRS Form 8938.

I hope this helps. For a similar article on foreign real estate, see: Do I Need to Report my Offshore Real Estate on IRS Form 8938?