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Is Gold Stored Offshore Reportable to the IRS?
By admin | April 27, 2009
Although we are a very much an international business, we naturally have more than a few readers who are US taxpayers in one way or another, and are liable to file IRS tax returns. And by definition most of our readers are already involved in offshore or international banking. A question that frequently pops up, therefore, is “Do I have to Report Gold Stored Offshore to the IRS on the FBAR (Foreign Bank Account Reporting) form?”
This question is also relevant to non-US residents as similar reporting requirements exist in other countries – although you should be sure to check local reporting requirements very carefully in the country where you normally file tax returns, as reporting requirements do differ significantly.
The so-called IRS FBAR requirements actually refer to the requirements of a Foreign Bank and Financial Account Reporting form. The actual form number you will be working with is TD F 90-22.1. Under current U.S. law, any person living in the U.S. must file this form if he or she has a financial interest or signature authority in a foreign financial account that has an aggregate value of over $10,000 at any time during the course of a year. This not only includes U.S. citizens but also all residents, domestic partnerships, domestic corporations or domestic estates.
The question has been raised and answered many times before, but was addressed recently by Mark Nestmann of the Sovereign Society, in an article entitled Are Precious Metals Stored Offshore Reportable Financial Accounts? As Nestmann says, tax authorities “construe the term “financial account” very broadly. The definition unquestionably includes bank, securities, and other accounts that hold financial instruments. However, it does not include individual bonds or stock certificates.”
The question, therefore, is whether physical gold bullion that you hold in an offshore vault (or anywhere else offshore for that matter) is reportable. The IRS gives no clear guidelines on the matter, and you probably wouldn’t want to call your local IRS office and ask them directly. Better to check with a suitably qualified tax attorney who is working on your side!
Nestmann’s conclusion is that “If you hold the metals in a safety deposit box or private vault, without opening a bank or other financial account, you don’t appear to have any reporting obligation.” At many offshore banks you must open an account in order to rent a safety deposit box, but you could always keep the balance of this account under the $10,000 FBAR reporting requirement. There are also a number of non-bank safe deposit facilities available in Austria, Switzerland and the Caribbean.
More information on how to buy gold bullion offshore, as well as where to store it (including specific names and addresses of little known storage and vault facilities) may be found in The Gold Report by Peter Macfarlane. There are also some important warnings about places you should NOT store gold bullion and other precious metals, including anywhere in the United Kingdom.
If you are interested in buying and storing gold bullion offshore, The Gold Report is for you. The good news is that it’s available free for immediate download to members of Q Wealth Report in the members’ section. If you are not a Q Wealth member and don’t want to sign up, you can now also purchase Peter Macfarlane’s Gold Report as an e-book at the Expat Wealth bookstore.
Note: sampling the quality of Peter Macfarlane’s articles costs you nothing. Simply enter your e-mail address on the box to your right to receive a free 6-part course entitled “Secrets of the Super Rich” in your e-mail inbox. No spam guaranteed!
Sphere: Related ContentRelated posts:
- Buying Gold Bullion Offshore: Your Safe Haven for Asset Protection
- Gold and Silver Cannot Evaporate – But Accounts Receivable Can!
- Why You Should Buy Gold Even if it is Manipulated
Topics: Investing in precious metals, Offshore Wealth Creation | No Comments »
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