Tennessee Governor Bill Lee has signed into law a bill that will repeal taxes on the sale of gold and silver coins, making the state the 42nd in the nation to free gold and silver transactions from taxation.
“In-state dealers and folks all across Tennessee made their voices heard and helped get this bill across the finish line,” said Representative Bud Hulsey, a sponsor of the legislation.
Tennessee had taxed precious metals transactions by as much as 9.75 percent. Now Tennessee becomes the latest state to free gold and silver from sales taxes.
A new law in Virginia will extend that state’s tax exemption on gold and silver transactions of less than $1,000 for a period of at least three years. Meanwhile, Alabama has also extended by five years its exemption for small gold and silver transactions. Last year, Ohio and Arkansas repealed sales taxes on gold and silver coins and bars.
The legislative victories end some discriminatory practices against precious metals buyers, as purchasers of other investment vehicles, such as stocks and bonds, do not pay a sales tax upon purchase.
There is no federal tax on gold and silver sales. But, the federal government does tax gold investors when they cash out profits. When held for more than a year, profits from gold are taxed as a collectible at a rate of 28 percent. This is a good reason to hold gold assets in an individual retirement account (IRA) because assets in a traditional IRA are not taxed until they are withdrawn during retirement years.