This is copied off a different thread under a different topic, so I thought it would be interesting information for some. It is regarding your ability to buy and sell Silver without paying capital gains on the profits from each sale. It falls under the tax code regarding "like kind" trades. You are still on the hook to eventually pay capital gains from your profits, but they are deferred until you sell your Silver for cash, providing you meet all of their requirements.
Thanks Bone, that link you posted provided the same information I found on the web. The following was extracted from your link:
(5) Rev. Rul. 82-96 – The exchange of gold bullion for Canadian Maple Leaf gold coins (which are legal tender in Canada to the extent of face value of $50 each) qualifies for nonrecognition of gain or loss as a like kind exchange under section 1031(a) of the Code.
In this ruling, the Service provided the following reasoning:
"Because the value of the gold content in each Canadian Maple Leaf gold coin greatly exceeds its face value, it is not a circulating medium of exchange. Therefore, the Canadian Maple Leaf gold coin is property rather than money for purposes of section 1031(a) of the Code. Because the Canadian Maple Leaf gold coins are bought and sold for their gold content, they are bullion-type coins. Therefore, the nature and character of the gold bullion and the Canadian Maple Leaf gold coins are the same, and they qualify as 'like kind' property as that term is used in section 1.1031(a)-1(b) of the regulations."
I read the same basic information regarding Silver.
As long as your trading Silver bullion for Silver bullion, it is a like kind trade. The same goes for Gold.
You can do the same for Silver numismatic coins, if you purchase Silver numismatic coins. The same goes for Gold.
You can not trade Silver bullion for Silver numismatic, as that is not considered like kind. Same goes for Gold.
You can not trade any form of Gold for any form of Silver as they are considered to be different products.
To take it one step further. You can trade one horse for another horse and it is considered like kind as long as they are the same "sex".
This tax code really gets down to the nitty gritty of what is considered like kind.
Since I traded Silver bars for Silver Eagles, they are a "like kind" trade. One additional qualification is required as I understand this tax code. You can not sell your Silver and receive cash and then turn around and purchase other Silver. The only way it is considered legal, is to either trade your Silver for Silver and pay the difference without any funds being sent to you or you must sell your Silver and the funds must be placed into an escrow account controlled by someone else. You then have 45 days to purchase like kind Silver and it must be received within some other period of time, which I forgot. It was something like 90 days.
Which means that for those that buy and sell Silver during the highs and lows and received cash, they are legally on the hook for capital gains. So in the interest of self preservation, I wouldn't talk about any of those trades in the future, unless you can prove your funds were held in escrow and you met the IRS time lines. Of course you can always tell the IRS to piss up a rope as some suggest, but that's not the most prudent course to follow!