Owning gold is perfectly legal in many countries, including the United States. This was only sometimes the case, however, especially during specific periods in the 20th century when the ownership of gold was heavily regulated or outright banned. Today, individuals can sell, hold, and buy gold in various forms, including bullion, coins, jewelry, or certificates representing ownership of physical gold stored in a secure location.
When Owning Gold Was Illegal
One notable period in history when owning gold was illegal was in the United States between 1933 and 1974. On April 5, 1933, President Franklin D. Roosevelt signed an executive order that essentially criminalized the possession of gold. This order, known as Executive Order 6102, was made under the authority of the Trading with the Enemy Act of 1917, as amended by the recently passed Emergency Banking Act.
The order required citizens to deliver their gold coins, bullion, and certificates to the Federal Reserve on or before May 1, 1933. Citizens could keep up to $100 in gold coins; other exceptions were made for certain types of jewelry and collectible coins. However, the broad sweep of the order meant that for the average citizen, holding gold became a criminal act practically overnight.
This period of gold prohibition lasted for over 40 years. It was not until 1974 that President Gerald Ford signed a bill that once again legalized the private ownership of gold.
This was a radical policy at the time and was seen as a desperate measure by a desperate government to combat the Great Depression. By forcing people to give up their gold, the government hoped to boost the economy by increasing the money supply.
Why was it illegal to own gold in the US?
As mentioned before, the ban on private ownership of gold in the United States was implemented as an emergency measure to combat the Great Depression. The U.S. was on a gold standard at the time, meaning that the value of the U.S. dollar was tied directly to a specific amount of gold.
When the economic downturn hit, many people started hoarding gold, removing it from circulation. This tightened the money supply when the government encouraged spending to stimulate the economy. The government hoped to prevent hoarding and keep more money in circulation by outlawing the private ownership of gold.
How much gold can you legally possess in the US?
Today, there are no specific limits on how much gold a person can own in the U.S. Whether it’s bullion, coins, or jewelry, you can buy, own, and possess as much gold as you like. The only restrictions may come from reporting requirements if you simultaneously buy or sell large amounts of gold.
Certain transactions involving the sale of gold may trigger reporting requirements under IRS Form 8300. For instance, if a person sells more than $10,000 worth of gold to a dealer, that transaction is supposed to be reported to the IRS. But these reporting requirements do not limit how much gold a person can own.
What coin is illegal to own?
In the U.S., owning a 1933 Double Eagle gold coin is illegal. Although the U.S. Mint produced 445,500 of these $20 gold coins in 1933, none were officially released into circulation due to the change in policy that year, which prohibited the private ownership of gold.
However, some of these coins were smuggled out of the mint and found their way into the hands of collectors. Over the years, most have been seized by the U.S. government, but a few are still in private hands. If these coins were to surface, they would be considered illegal to own and would likely be confiscated by the government.
How does the IRS know if you sell gold?
The IRS does not automatically know if you buy or sell gold. However, businesses that deal in gold and other precious metals must report certain transactions to the IRS. For example, the transaction will be reported to the IRS if you sell more than $10,000 worth of gold at once.
How much is the customs duty for gold in the USA?
The duty for gold brought into the U.S. can vary, typically around 3.9%. It’s essential to declare any gold you get into the country and pay the necessary duty to avoid legal trouble.
What is the loophole of gold confiscation?
One loophole to gold confiscation in the U.S. owns rare or collectible coins. While the 1933 order made owning gold bullion illegal, it did not extend to rare, collectible coins. Therefore, collectors who owned gold coins were allowed to keep them.
Whether you are new to gold investing or have been a collector for years, it is essential to research and work with a reputable dealer. American Bullion is a trusted resource for those looking to invest in gold IRAs, offering a wide selection of gold coins from around the world and expert guidance on which coins are right for you.
So why wait? Invest in gold coins today and start building a brighter financial future.