Yes, you do pay taxes when you sell gold at a profit. The IRS treats physical gold as a collectible, so long-term gains are taxed at a federal rate of up to 28%, higher than the 0%, 15%, or 20% rates that apply to stocks and bonds. Short-term gains, on gold held a year or less, are taxed at your ordinary income rate, which can reach 37%. The rule covers bullion bars, coins, and gold jewelry alike.
How Much Tax You’ll Owe
Two things set your rate: how long you held the gold, and where your income falls.
Gold sold within a year of purchase produces a short-term capital gain, taxed at your ordinary income rate. Federal ordinary rates for 2026 run from 10% to 37%.1Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026 A quick sale gives up any rate advantage and can push a large gain into a higher bracket.
Hold the gold more than a year and the collectibles long-term rate applies, capped at 28%.2Office of the Law Revision Counsel. 26 U.S. Code 1 – Tax Imposed If your marginal ordinary rate is lower than 28%, you pay at that lower rate instead. The 28% cap is what most investors with meaningful gold holdings actually pay.
Collectible status is what drives this. The IRS groups investment-grade bullion bars, rounds, and popular coins into the same category as art, antiques, and gems.3Internal Revenue Service. Investments in Collectibles in Individually Directed Qualified Plan Accounts That single classification is the reason gold sits above the standard long-term capital gains rate.
The 3.8% Surtax for Higher Earners
On top of the collectibles rate, a 3.8% net investment income tax applies once your modified adjusted gross income crosses $200,000 for single filers, $250,000 for married couples filing jointly, or $125,000 for married filing separately.4Internal Revenue Service. Topic No. 559, Net Investment Income Tax Those thresholds are not indexed for inflation. Combined with the 28% collectibles rate, the effective federal tax on a long-term gold gain can reach 31.8%.
Figuring Your Gain or Loss
Your taxable gain is the difference between what you received from the sale, after fees, and your adjusted cost basis. Positive is a gain, negative is a loss.
Basis includes everything you paid to acquire the gold: the purchase price plus dealer premiums, commissions, shipping, and assay costs. On the selling side, subtract any fees the buyer charged. Buy a gold bar for $10,000 with $150 in shipping and premiums, and your basis is $10,150. Sell it later for $15,000 after a $200 dealer fee, and your net proceeds are $14,800. The gain is $4,650.
Proving basis is on you. If the IRS questions a sale and you can’t produce a receipt or confirmation showing what you paid, they can challenge any basis you claim, and in the worst case you’d pay tax on the full sale amount. Keep purchase records, dealer confirmations, and cost documentation for as long as you own the gold and at least three years after filing the return that reports the sale.5Internal Revenue Service. Publication 583 – Recordkeeping If you underreport income by more than 25%, the audit window stretches to six years, so longer retention is safer for high-value holdings.
Reporting the Sale
Every gold sale producing a gain or loss goes on Form 8949, listing the acquisition date, sale date, proceeds, and cost basis. The totals flow to Schedule D of your Form 1040, which calculates your net capital gain or loss for the year.6Internal Revenue Service. Instructions for Form 8949 (2025)
When a Dealer Sends You a 1099-B
Not every sale triggers dealer reporting, and the precious metals rules are narrower than most sellers assume. A broker only files Form 1099-B when the sale involves a type and quantity of metal that could satisfy a regulated futures contract approved by the Commodity Futures Trading Commission. Quantities below the minimum delivery amount for such a contract are exempt from broker reporting.7Internal Revenue Service. Instructions for Form 1099-B (2026)
Dealers must aggregate a single customer’s sales within a 24-hour period against these thresholds, so splitting a large sale into smaller same-day batches will not avoid reporting.8Internal Revenue Service. Correction to the 2025 and 2026 Instructions for Form 1099-B – Sales of Precious Metals
Whether or not you receive a 1099-B, you still owe tax on any gain. No form arriving in the mail does not mean the IRS is not expecting the sale on your return.
When You Sell at a Loss
A loss on investment gold can offset capital gains from other investments. Collectible losses first offset collectible gains, then apply against other long-term or short-term gains. If total capital losses exceed total gains for the year, you can deduct up to $3,000 of the excess against ordinary income, or $1,500 if married filing separately. Anything left over carries forward indefinitely.9Office of the Law Revision Counsel. 26 U.S.C. 1211 – Limitation on Capital Losses
Gold gets one meaningful break here: the federal wash sale rule doesn’t apply. That rule blocks a loss deduction if you repurchase “substantially identical” stock or securities within 30 days, but by statute it covers only stock and securities.10Office of the Law Revision Counsel. 26 U.S. Code 1091 – Loss From Wash Sales of Stock or Securities Physical gold is neither. You can sell at a loss, buy the same bullion back the next day, and still claim the loss.
A boundary worth flagging: losses on gold jewelry you wore or kept for personal use are not deductible at all. The IRS treats losses on personal-use property as non-deductible, even though a gain on the same item is taxable.11Internal Revenue Service. Losses (Homes, Stocks, Other Property) The loss-harvesting flexibility above applies to gold held for investment, not to a chain you wore for a decade.
Situations That Change the Answer
Gold Held in an IRA
Physical gold inside a self-directed IRA is not taxed when you buy, sell, or trade within the account. Tax comes due only on distribution: traditional IRA withdrawals are taxed as ordinary income, and qualified Roth distributions are tax-free. The collectibles rate never enters the picture.3Internal Revenue Service. Investments in Collectibles in Individually Directed Qualified Plan Accounts
Strings attached: the bullion must be at least 99.5% pure, with certain U.S. Mint and state-issued coins qualifying under statutory exceptions, and it must be held by an approved bank or non-bank trustee. Storing IRA gold at home or in a personal safe is a prohibited transaction. If the IRS finds out, the full value is treated as a distribution in the year you took possession, taxable as ordinary income, plus a 10% early withdrawal penalty if you’re under 59½.
Gold You Inherited
Inherited gold gets a stepped-up basis. Your cost basis becomes the fair market value on the date the original owner died, no matter what they paid.12Internal Revenue Service. Gifts and Inheritances All the appreciation during the decedent’s lifetime drops out of the tax picture. Inherited property is also automatically long-term, so if you do sell at a gain, the 28% collectibles rate applies rather than short-term ordinary rates.
Gold You Received as a Gift
Gifted gold is different. You generally take over the donor’s original basis, which means gains built up over their years of ownership come with the gold to you.13Internal Revenue Service. Property (Basis, Sale of Home, etc.)
For the giver: transfers of up to $19,000 per recipient in 2026 fall within the annual gift tax exclusion and require no gift tax return.14Internal Revenue Service. What’s New — Estate and Gift Tax Larger gifts require Form 709, though actual gift tax rarely applies until the donor exceeds their lifetime exemption.
Swapping Gold for Gold Doesn’t Defer the Tax
Before 2018, some investors used Section 1031 like-kind exchanges to swap gold coins for gold bars, or gold for silver, and defer the gain. That option is gone. The Tax Cuts and Jobs Act limited Section 1031 to real property, and that restriction remains in effect for 2026.15Office of the Law Revision Counsel. 26 U.S. Code 1031 – Exchange of Real Property Held for Productive Use in a Trade or Business Any trade of one form of precious metal for another is now taxed as an outright sale.
What Happens If You Skip It
Leaving a gold sale off your return costs more than the tax itself. The IRS charges a 20% accuracy-related penalty on any underpayment caused by negligence or a substantial understatement, defined for individuals as being off by the greater of 10% of the correct tax or $5,000.16Internal Revenue Service. Accuracy-Related Penalty On a $50,000 long-term gain, the federal tax at 28% is $14,000. A 20% penalty adds $2,800 on top, and interest runs from the original due date. Reporting the sale correctly the first time is far cheaper.