are gold coins considered tangible personal property

The Regan era coins are collectibles. 6411 Ivy Lane, Suite 200 That's my opinion. That way, you can update that list periodically, without the expense of having to update your Will. This list may be revised by the testator (the person bequeathing his/her estate) as often as desired during his/her lifetime, and does not require an attorney, witnesses, or notarization. Intangible personal property is property that cannot be physically handled, including but not limited to: Stocks; Trust fund accounts; Deeds of title; and Ownership rights. A safe deposit box is not an item of tangible personal property, but the box could include items of tangible personal property. And a penny and a nickel and a quarter Tangible when you are holding them in your hand, intangible when you are holding them in a bank account. The sales and use taxes are imposed with respect to sales of tangible personal property (G.L. 3)Is the donation still reported in Section B of the 8283 and does the client still need an appraisal and the 8283 signed by the appraiser, or is it considered a cash donation? I think more parsing is needed. Wow, DAJCPA. Other considerations You keep ignoring your own 408 citation. I mean, hell, if the coin is tangible because you can touch, then so is a stock certificate or bond. 43, sec. I'm also smart enough to know that OP's client has a pretty good case to make some waves with this issue. Tangible personal property (TPP) comprises property that can be moved or touched, and commonly includes items such as business equipment, furniture, and automobiles. I dont think youre going to find any relevant guidance on this issue other than the PLR. "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.". For example, it is not realistic for multiple beneficiaries to inherit a valuable painting or a large boat. 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." The twisting reflects reality. So, I would say that I have a pretty open mind. are gold coins considered tangible personal propertyperiodic 3m system meetings with department heads are gold coins considered tangible personal property. The fact is, however, the courts have repeatedly held that these coins are "property other than money. In other words, substantial authority is certainly nice, but it doesn't mean you're gonna win. A tangible personal property list can be used to transfer a broad array of personal property, with the exception of money, coin collections, and property used in trade or business. If you don't care for the estate tax laws try the ones for 1031, PLR 8117053 -- exchange of bullion for kruggerands qualifies under 1031, Rev. The "gold masters" allowed the corporate mainframe to communicate directly with the store computers. Tangible personal property is a term most often used for tax purposes. It includes all personal property that isn't considered real property or intangible property such as patents, copyrights, bonds or stocks. If you really want my opinion, it sounds a like money, but that might be a stretch (I know, a legal tender U.S. coin being treated as money). If you take the position it is in error, the obligation to show otherwise is on you. You dont want your bequests to result in disputes among your heirs or in court proceedings because the items were not gifted in a legally correct manner. 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 . Tangible personal property is a tax term describing personal property that can be physically relocated, such as furniture and office equipment. Accordingly, it may be best to specify that these types of assets will be sold or provide that a beneficiary may have the option to use his or her part of the estate to buy the asset from the estate at its appraised value. Tangible property also includes all miscellaneous assets that do not inherently qualify for any other class life, such as jewelry, toys, and sports equipment. South African Krugerrand gold coins are one of the best known types of gold bullion coins. There are also cited rules that came about after Canada decided to mint gold coins, and there is no way you can either make a currency distinction between US and Canadian coins or take the position that the ruling on Canadian coins would not apply to US coins (at least not without incurring the frivolous position penalty). akin to appreciated stock held for the LT]we have a deduction of 15 cents. One of the many reasons a person creates a Will is to specify who is to receive or what should happen with their tangible personal property when they die. 2008). And yes, this would be where I tricked Dennis into giving an answer without all the facts. The copyright for the song, though, is considered . This includes property that can be touched, moved or consumed and excludes real or intangible property. But the objections to the PLR are more than just "someones opinion." Things evolve and things change. This charity gives out tax advice, or something like that. We don't care what 1031 says. Dennis writes: And note, the RR *didn't* say, "the coins can be felt and touched, so they are tangible personalty property.". Please remove any contact information or personal data from your feedback. I can't say I don't care for them, I just don't find them to be relevant in the income tax areaalthough the income tax issue all started, pretty much, with an estate tax ruling (RR 78-360), wherein the circulation issue was first raised. Dennis is acting like he telling us something new, which he's not. 439.2) Sec. But then again, maybe the IRS is re-thinking its position here, and its position in the subsequent PLR, as a few places have noted. I guess we could say since OP's coins *aren't* all that, then OP's coins are not tangible personalty, for Section 170 purposes, per that RR. If you turn a $10 face vlaue gold coin in to the Federal Reserve, they'll give you a $10.00 Federal Reserve Note (i.e. 1)Does the client get the bullion value of the gold as a charitable donation deduction (i.e. The ruling doesn't speak to Sec 1031. Alcohol The transfer of valuable wine collections or other alcohol is governed by state law and may require a license. You ever dealt with a donation of non-numismatic coins? Gotcha. 20.2104-1(a)(2)has always included the contents of a safety deposit box. So, by this definition, such a good coin wouldn't be a collectiblemaybe wouldn't be "property other than money," leading one to conclude that it might be money. Exactly. This compensation may impact how and where listings appear. But the carve out, although it doesn't mean that much, at least in my mind, makes one wonder if the implication is that the carved out coins are, in fact, "money." I do wonder though, why a stock certificate is not treated as tangible personalty. Find me a charitable letter that actually has all the right words. With Examples. My mind is closed from the standpoint that I do not believe we should always apply old paradigms to new issues. Obviously, if the coins in the RR did not acquire any "collector's value," then the RR would have had to address that fact and would have been worded completely different. If that's all you've got you are going to lose. Liza is an attorney who specializes in estate planning for families of all ages. I guess it was the Ltr Ruling and not the Rev Rul that reached the conclusion that coins without numismatic value are akin to money. These trusts allow for money to be set aside and held in trust giving the trustee the power to make distributions to a custodian of the pet for the pets benefit. 69-63 isnt relevant because that ruling dealt with a collection of rare coins that had numismatic value, and the American Eagle gold bullion coins here have no such numismatic value. It's really a muddled thing with legal tender gold coins: there's cost, face value and real value. The Regan era coins are tangible personal property subject to gift tax. The Canadian Maple Leaf is "money" It has a defined currency value. The law also (in all cited cases) makes a clear distinction between currency value and market value. Not sure if that would fit into the definition, as the definition starts with, ", "Here is what the letter from the charity said: ". Good question. Yes, I'll just cut and paste from my above comments, since you're a little slow today. You conveniently left out of the parts about (1) the coins being rare and (2) the coins acquiring value as collector's items. The Comptroller treats the sale of software, canned or custom, as the taxable sale of tangible . It includes all personal property that isn't considered real property or. Is money considered tangible personal property? The asset appraiser will assess the current condition of the assets, including the degree of obsolescence and level of wear and tear. Gold prices have declined about 15% since they reached nearly $1,900/ounce last August and are known to be volatile as a rule. Tangible personal property is anything with physical existence -- things that can be felt or touched. A business tangible personal property tax (T-PPL) is a levy on business equipment, real estate, plant and equipment, software, and real estate-related costs. People can hold this type of property and they can also see it. Couldn't have anything to do with recognition of the fact that it's tangible personal property, could it? You talk about the ruling predating and somehow can't recognize the extension and why it still applies. To claim the deduction, the tax must only apply to personal property owned and bought for the business operation, be based on its fair market value, and be charged on an annual basis (as opposed to a one-time basis). Coins kept in collection fashion (coin holders, and so on) as opposed to coffee cans full of coins, piggy banks, etc. They are probably the bullion coins authorized by Reagan. This shouldnt be an issue for gold bullion, which is readily marketable, except perhaps when funding occurs at the very end of the year). In my opinion, that's no proof at all. And the term is used in different ways in the numismatist world. I fail to see the logic in assuming the language "coins not held primarily as a medium of exchange" has relevance only to rare coins when that same language is widely used to apply to all precious metal coins. her pearls go to her favorite niece, Alice. gold, silver, or numismatic coins of any value; iii. Legal Tender. And whose to say what OP's holding purpose was? All investing involves risk, including loss of principal. Gold coins and bullion are tangible personal property under the IRC and are taxed as a collectible. This one certainly didn't. I'd be fine taking the position that the gold coins were cash, for 170 purposes, seeing that's what they are, under the USC. 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 taxes are typically assessed at the state level, though they may be dictated by county, city or local municipality. 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. No net deduction. 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. As is your sales tax path, your estate tax path and your gift tax path. Inventory and household goods are excluded (section 19 2.001 (11) (d) , F.S.) I simply do not believe that the a U.S. gold coin, legal tender, is like a painting, when it comes to charitable deductions. Purchase gold bars, which can be as small as one ounce. Goodman Law | Attorney Advertising, 14 Ridgedale Avenue, Suite 254, Cedar Knolls, NJ 07927 | Phone: 973.567.3849, Legal Blog For Elder Law and Estate Planning In New Jersey, Estate Planning Questions About Tangible Personal Property, Elder Law From an Estate Planning Perspective, The Difference Between Executors, Trustees, and Guardians, Avoiding the Pitfalls of Trust and Estate Administration, Divorced Parents with Special Needs Children, Estate Lawyer Planning for Solo Boomers, Estate Planning: Telling your Children What Youre Planning and Why. Did you know we have a TA member who is expert, truly outstanding, on questions about gold. The calculation of your tangible personal property (TPP) is primarily used for taxation purposes. Stock, real estate, inventory, taxidermy property, patents, partial interests, self-created, etc. Certain individuals are prohibited from being gun owners, for example, a person convicted of a crime or who has been adjudicated mentally defective, a fugitive, an illegal alien and anyone who has received a dishonorable discharge. Holding period might matter as well. To avoid any confusion as to what a person considers to be the tangible personal property a Will should include its own definition of that term and specifically carve out of that definition any items that the person may want to leave specifically to one or more persons, or perhaps fall in the typically larger rest and residue provision of the Will. The value of tangible personal property may range from very nominal value e.g., old pots and pans to considerable value, for example, art, stamps and coins, gold bullion and gold and silver bars. Not a problem. Investments in gold can take a number forms, all of them readily marketable. But if the 1031 exchange of bullion into coins is taxable, wouldn't the favorable tax treatment, on the donation, be offset by the unfavorable gain recognition on the 1031? Conventionally, for something to be considered tangible property, it is (in the words of an accepted legal dictionary): "property that has a physical form and substance and is not intangible. He can then donate the same value but get favorable tax treatment under the PLR. Typically, individual retirement accounts (IRAs), which are tax-advantaged, can be used to hold tangible assets, such as gold and silver coins. After working through the tax savings below, it becomes apparent that Mr. Franklins net cost is about 70 cents on the dollar. This isn't my article, but here's some stuff on it: Thanks, Chris. And a judge might just be the one to do it. a) Held over one year. 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. Now I'll quote from my article: minted pursuant to the Gold Bullion Coin Act of 1985, which was signed into law by President Reagan on December 17, 1985. They are a lot of someone's opinion. In a Florida estate some gold coins were listed on a probate inventory listing supplied by the estate trustees and lawyers. It is important to remember that if you are preparing a separate statement or list, it may only serve to distributetangible personal property, not cash, securities, negotiable interests or services. Held, since the collection of rare coins was not held primarily as a medium of exchange but instead has acquired added value as collector's items, the collection is tangible personal property for purposes of section 170(f) of the Code, OP's coins, as OP states, had no numismatic value. Tangible personal property (TPP) comprises property that can be moved or touched, and commonly includes items such as business equipment, furniture, and automobiles. Rul. Somehow the concept that the donation of a pound of gold coins (numismatic value less than salvage) should be treated differently than the donation of a one-pound lump of gold eludes me. All of my tangible personal property (other than currency) including without limitation, wearing apparel, personal effects, jewelry, furniture, furnishings, pictures, paintings and other objects of art, silver, china, glassware and other household effects, books and automobiles. 5739.01(DDD). I report the value as income (realization). This is because this type of property usually does not increase in value over the years. The term includes articles even if held for investment purposes and encompasses tangible property . There are no guarantees that working with an adviser will yield positive returns. Contact Us: Each evidences something else. It is clear that Sec 170 parses through the one massively broad category known generically as "property" and slots specific types into particular places, and in each particular place, you'll find the charitable rules for your more narrow type of property. Those were the good old days. Dennis' points are taken, and again, he might very well win this one. However, many other physical assets, such as antiques and artworks, are not permitted within the accounts. It includes all personal property that isnt considered real property or intangible property such as patents, copyrights, bonds or stocks. This is contrasted with intangible personal property, which includes stocks, bonds, and intellectual property like copyrights and patents. 408(m)(3)(A)(i)(i) a gold coin described in paragraph (7), (8), (9) , or (10) of section 5112(a) of title 31, United States Code. You want your 12 cent dime to be money, put it in an account and add 10 cents to your balance. Collectibles Going down the 1031 path will get us nowhere in this inquiry. Liza is also the author of Busy Family's Guide to Estate Planning: 10 Steps to Peace of Mind. Tangible personal property is a tax term describing personal property that can be physically relocated, such as furniture and office equipment. These personal and business taxes are assessed on certain tangible personal property items, depending on where you live and what you own. And I'm sure you would submit the charity's letter as evidence. Also, because the coins have both intrinsic and marketable value, in and of themselves, they cannot be considered intangible property, without more. This page was last modified on 22 March 2014, at 18:01. But, as I then admitted, even though taxpayer favorable - that carve out in 408(m) - I wouldn't bet the farm on it. And, if we must go there, we should cite the relevant parts from the RR. For purposes of this subsection, the term collectible shall not include. Legally, pets are considered to be "property." To meet the legal definition, "tangible" property must not only be tangible, of course, but also weighed and "physically relocated." Keeping up with the law's definitions of tangible and intangible personal property is key in estate planning and probate administration. (1) The following shall be exempt from taxation under the provisions of part 1 of this article: (a) Any right to the continuous possession or use for three years or less of any article of tangible personal property under a lease or contract, if the lessor has paid to the state of Colorado a sales or use tax on such tangible personal property upon its acquisition. If its deemed to be tangible personal property, then you can just gift it via a separate list, without the need for witnesses or a notary. I couldn't. Then we'll put the coins in an "account" and transfer the account to charity. Who knows? But I think everyone is laughing at you. A completely closed mind. 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