You want your 12 cent dime to be money, put it in an account and add 10 cents to your balance. Part of it, I think, is the fact that the U.S. had been out of the gold minting business for quite some time before Reagan. A .mass.gov website belongs to an official government organization in Massachusetts. On the realization side, the coins are treated as "property other than money." The article involved realization only and took no position on anything. No it's not. There are no guarantees that working with an adviser will yield positive returns. People can hold this type of property and they can also see it. As such, applying a strict "personal property" label to something like a gold coin might not be appropriate. They are still tangible personal property. And Dennis might actually win this onebut that won't stop me from arguing. These are items that you own, but that don't have a title document (like a deed, or a pink slip). An official website of the Commonwealth of Massachusetts, This page, Letter Ruling 83-28: Gold Coins, is. The central question here is whether American Eagle gold bullion coins, having no numismatic value, donated to a charity, are tangible personal property for purposes of IRC 170(e)(1)(B) that limits the charitable contribution deduction to the donors cost basis. are gold coins considered tangible personal property. Trying to apply realization concepts and pre-dated Regs to something as novel as a newly minted U.S. gold coin, a new asset class, might not be suitable. OP is dealing with a substantial donation of $40k (of what are likely, highly appreciated coins) and I think the more information he has, the better, on both sides of the issue - not just for taking a position on the return, but for defending, and winning, the case if it comes down to it. More advanced planning can involve the use of gun trusts as owners for NFA guns to avoid transfer restrictions. OK. Now Fogel states categorically that the people who say the PLR would have been reversed are just repeating what someone else told them and in actuality have no direct knowledge. Wills often contain trusts for the benefit of younger or disabled persons. If the courts would like to call these coins "property other than money," for purposes of 170, then great. Tangible personal property (TPP) comprises property that can be moved or touched, and commonly includes items such as business equipment, furniture, and automobiles. And note, the RR *didn't* say, "the coins can be felt and touched, so they are tangible personalty property.". You want to take the opposite position, but you have nothing but hearsay to rely upon. For example, is a collection of gold Krugerrand coins considered cash ortangible personal property? More careful planning is required for the following types of assets that are governed by federal, state and local law: Firearms - The mere possession of certain unregistered weapons may be a federal and/or state crime. 5739.01(DDD) and O.A.C. You skipped the table of contents section. Tangible personal property is always depreciated over either a five- or seven-year period using straight-line depreciation but is eligible for accelerated depreciation as well. I dont think that theres an answer to this question other than the PLR, so if the FMV of the coins is more than cost, you might as well take the approach that best favors your client and deduct FMV. 43, sec. Often, a Will will leave all such tangibles to a spouse or to children. Shall we start a thread about *Bitcoin?*. Tangible personal property is a broad category of items, covering everything from valuable family heirlooms to the contents of your junk drawer. Is money considered tangible personal property? When appraising your tangible personal property, an assessment may include your: Tangible personal property is taxed ad valorem. For those who are interested in life income, a gift annuity or charitable remainder unitrust are both reasonable alternatives to giving gold outright. The Federal Gun Control Act imposes additional restrictions on certain weapons, including assault weapons, plastic guns, machine guns, armor piercing bullets and body armor. [2], "A second Kruggerand ruling submitted some nine months later, which was withdrawn because of the tax payers death, appeared to indicate that IRS had changed its mind." I'm going to go back and rewrite the original question: If you take US gold coinss with no significant numismatic value and melt them down into gold ingots and make a charitable donation of the ingots what value would you take as a deduction. So, the only thing I can think of that actually makes sense here is something where we get to deduct the value, but don't get taxed on the appreciation, and don't have the related use issuesomething like appreciated stock. However, certain types require special attention because of laws regulating their ownership, registration, and possession: Firearms Alcohol Ivory, furs, and other artifacts made from endangered species For purposes of this subsection, the term collectible shall not include. Obviously, an author's opinion in an article isn't authoritative "guidance." The article had nothing to do with OP's question about Sec 170. I do realize, however, that the case law, etc. . There needs to be a beneficiary named to receive the remaining funds at termination of the trust. Tangible personal property includes items such as vehicles, antiques, silver, artwork, collectibles, furniture, machinery, and equipment. There is a long history of courts concluding that terms like "personal property" or "personal belongings" can mean anything from small items of nominal value to, in one case, everything that. Investguiding Therefore, since PLR 9225036 concluded that gold bullion coins were not personal property for purposes of IRC 170(a)(3), we can safely take a position on a return that a client may claim FMV (not cost basis) for a donation of those coins. He offers no evidence to support this position and apparently he seems to think that OP should be comfortable walking into Tax Court with nothing but the language of the PLR. So are ETFs that invest in gold bullion. He even wrote an article on it about a year ago, give or take. If that's all you've got you are going to lose. International trade would hardly work if they weren't. The amount realized from the sale or other disposition of property shall be the sum of any money received plus the fair market value of the property (other than money) received. The principal difference between LPP and other personal use properties is that LPP usually increases in value over time. That's why I like the "akin to an appreciated stock" argument better. Of course, you said, "bull," which just goes to show you didn't see the link between OP's coins and 408(m)and you didn't fully understand the true nature of OP's coins. The trust may cover one or more pets and continues in place until all pets for whom the trust was established is no longer living. There is little doubt that gifts of gold bullion or of shares in a gold bullion ETF are gifts of tangible personal property. It just fleshed out the history of the cases and the facts, with a few observations here and there. The existence of a fiduciary duty does not prevent the rise of potential conflicts of interest. Maybe Congress wants you to "invest" your IRA dollars in U.S. gold coins. All personal property located in residence. 129 Mount Auburn Street Effective July 1, 2020, there is a new law in Florida (Section 731.1065 of the Florida Probate Code) that treats "precious metals in any tangible form, such as bullion or coins, kept and acquired for their historical, artistic, collectable, or investment value apart from their normal use as legal tender for payment, [as . If you actually read what Dave wrote, he was speaking about "guidance"as in cases, rulings, and the like. Argument can be made that they're "money" under the tax code, since case law brings up "circulating" as a critical distinction between "money" and "property other than money." That's not the OP's case. Tangible personal property is a tax term describing personal property that can be physically relocated, such as furniture and office equipment. However, many other physical assets, such as antiques and artworks, are not permitted within the accounts. http://www.pgdc.com/pgdc/tangible-personal-property. It is a crime to distribute a gun to a prohibited person. Tangible personal property is a tax term describing personal property that can be physically relocated, such as furniture and office equipment. The more information one can obtain regarding an issue, the better. 5703-9-46(A)(7) do differ somewhat on the treatment of "customized" software. Code specific to exchanges, no? Makes no sense to me, but. Tangible personal property values are taken into account for both personal and business tax purposes. They will then value your property, usually using a fair market value chart or table. Uhhh, OP's charity already has taken that position. Estate Planning for Art and Personal Property. the deduction is not limited to face value)? Thanks in advance for your help! If it is, the donors deduction is limited to the lesser of market value and cost basis except in the unlikely instance that the gift would be for related use. I couldn't. 2 & Ch. PLR 9225036 is the only relevant guidance here. A fixed asset is a long-term tangible asset that a firm owns and uses to produce income and is not expected to be used or sold within a year. In my opinion, that's no proof at all. Heres why. It was very neutral. I'm afraid you will not find one, which leaves the issue unresolved. 23. platinum, gold, or silver bullion having a total value of $1,000 or more; . Dennis points are more than well taken. Photo credit: iStock.com/Artur, iStock.com/Pete Martin, iStock.com/vm. c) Carries no numismatic value.". That was his point. Personal-use property. I tend to think an American gold coin, legal tender, like the OP's gold coin, is more akin to an appreciated stock than a painting. Tangible Personal Property (TPP) means all goods, chattels, and other articles of value (excluding some vehicular items) capable of manual possession and whose chief value is intrinsic to the article itself. Heres a look at what tangible personal property is and how it can affect your tax bill. Conversely, tangible personal property, such as machinery, vehicles, jewelry, electronics, and other items can be physically touched and have some level of value assigned to them. For charitable purposes, if treated as "money," the deduction would be 10 cents. Disclaimer -- Legal information is not legal advice. As mentioned, tangible personal property is anything that can be touched, moved or consumed, with the exception of real property (real estate) and intangible assets with a recognized value (stocks, bonds, patents and the like). So, in a nutshell, even if we win on the "Ok, we'll treat it as money and not as property, and not as tangible personal property," we might lose on the deduction amount: we might only get face value. Now, with all that said: I readily admit that, on the realization front, gold coins are treated as "property other than money." An article written by someone isnt guidance; its someones opinion. For purpose of 2501. Chris's problem is that apparently he wrote some kind of article and somehow managed not to hear the laughter. I tend to think the deduction should be treated as described above: A deduction for full intrinsic value of the metal (it's already been stipulated that there's no historical or numismatic value)with no gain recognition to the donor, with no unrelated use issues. Ckenefick and Dennis, watching you debate over this is certainly entertaining, but I dont think its been very helpful to the OP. Definitions. But, as things stand now, you're right. Aaah, maybe the IRS thinks *this* type of "personalty" is different than *other* types of "personalty" so they apply a special rule to it. And that is the position of every state that imposes a sales tax. First, here is what you wrote: Rev. Those were the good old days. Of course, the word "money" isn't defined in the Tax CodeI made that point too, Dennis, but maybe you missed it. He bought them strictly as a gold bullion investment, not as a collector. 69-63 A safe deposit box is not an item of tangible personal property, but the box could include items of tangible personal property. (Might also want to try paying your local property taxes with onesee how much credit they'll give youor, just ask Mr. Klein (Crummey vs. Klein Indep. And read DAJ's fourth post about the charitable letter. the gold watch goes to her daughter and the stamp collection goes to her son. Yeah, me too. It is treated as "money," despite what Dennis thinks. Gotcha. Different rules depending on the situation. You ever dealt with a donation of non-numismatic coins? They've just said it's property other than money. We will use this information to improve this page. So, I pointed to the one place in the IRC when there's a relevant reference to Gold - Sec 408 - wherein the gold coins at issue (I'm pretty sure) were carved out as not being treated as a collectible. Precious metals like gold, silver, or platinum, are another example of tangible assets. Use SmartAssets property tax calculator to better understand the average cost of property taxes in your state and county. But, as I then admitted, even though taxpayer favorable - that carve out in 408(m) - I wouldn't bet the farm on it. Exactly. Appraisal Method. Identifying ones unique assets and carefully considering how best to distribute ones tangible personal property helps to avoid disputes among ones beneficiaries. "Tangible personal property" is defined in General Laws Chapter 64H, Section 1(15) as, "personal property of any nature consisting of any produce, goods, wares, merchandise and commodities whatsoever, brought into, produced, manufactured or being within the commonwealth, but shall not include rights and credits, insurance policies, bills of exchange, stocks and bonds and similar evidences of indebtedness or ownership.". Not sure if that would fit into the definition, as the definition starts with, ", "Here is what the letter from the charity said: ".
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