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PaperclipPerfector  6d ago (text post)   1483 thread views

Friday Fun Thread for January 3, 2025

Be advised: this thread is not for serious in-depth discussion of weighty topics (we have a link for that), this thread is not for anything Culture War related. This thread is for Fun. You got jokes? Share 'em. You got silly questions? Ask 'em.

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“My view, which is backed up by language in the U.S. Constitution, is that gold and silver coins are money and are legal tender,” Rep. Mooney said. “If they’re indeed U.S. money, it seems there should be no taxes on them at all. So, why are we taxing these coins as collectibles?”

Acting unilaterally, Internal Revenue Service bureaucrats have placed gold and silver in the same “collectibles” category as artwork, Beanie Babies, and baseball cards – a classification that subjects the monetary metals to a discriminatorily high long-term capital gains tax rate of 28% [versus the rate of 21 percent applicable to, e. g., stocks].

Sound money activists have long pointed out it is inappropriate to apply any federal income tax, regardless of the rate, against the only kind of money named in the U.S. Constitution. And the IRS has never defended how its position squares up with current law.

Furthermore, the U.S. Mint continuously mints coins of gold, silver, platinum, and palladium and gives each of these coins a legal tender value denominated in U.S. dollars. This formal status as U.S. money further underscores the peculiarity of the IRS’s tax treatment.

Thanks for the quote!

“If they’re indeed U.S. money, it seems there should be no taxes on them at all

My paystub would like to be the witness of the opposite. It's full of money, and so much of that money is so much taxes. My savings account - which also is entirely composed of money - is taxed on the capital gains also. And, of course, none of the investment bullion coins are ever used as money, this is plain bullshit - nobody is using gold dollars, which could cost from $400 to $200k or above, depending on particular coin, as a legal tender, even if in theory one could. One has to be a complete idiot to do so. But if such an idiot exists, and buys a gold dollar for say $400 and then uses it as legal tender at its $1 book value, I do not think the IRS is going to charge any capital gains taxes there - moreover, one could likely claim a $399 tax loss here and the IRS would likely accept that.

I'd say it is surprising how such weak bullshit appears in official Congressional record and is discussed and not laughed at derisively, but unfortunately it's not surprising at all and I have to admit I've seen worse than that. Still, very weak water. No surprise at all it's not successful.

Your paycheck isn't money, it's income.

What's being talked about is switching units of account. For example, if you hold a ton of Euros and British Pounds or whatever, and convert them into USD, you might have a capital gains tax or loss. Switching units of account is almost always a taxable event. USD are the baseline, and any time you move your wealth out of and into USD the government dings you.

The argument is that Gold and Silver are the only units of account specified in the constitution. It might even be true! But our government hasn't care about the constitution for a long, long time. And ever since we went off the gold standard, or probably when FDR confiscated all the gold, this part of the constitution quietly became obsolete. The time to have fought that fight was in the 30's. Doing anything about it now is trying to undo almost 100 years of consistently moving past that goalpost.

The argument is that Gold and Silver are the only units of account specified in the constitution.

So what? Again, I do not see how anything useful follows from that fact. Here's the only mention of gold in the Constitution:

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

We can immediately notice several things: a) it never says gold and silver are "units of account", it just bans states from introducing legal tenders that aren't gold and silver b) it actually contains no limits on the action of the Federal Government. Beyond that, however, the line from "states can only declare gold as legal tender" and "investment in gold can not be taxed" is not at all clear to me. It's like saying "English is an official language of the US government, therefore any university course taught in English should be free". Like what's the fricking connection between the one and the other?! Those are different things!

And BTW it is obvious this section only limits the States and not the Feds because Feds can enter into Treaties and Alliances, or coin money, of course. And when something that is prohibited overall is concerned (like Nobility) it is mentioned twice - once here and once in limitations on Congress.

And ever since we went off the gold standard, or probably when FDR confiscated all the gold, this part of the constitution quietly became obsolete.

But it did not. States still didn't make anything to be legal tender. Federal government made the paper dollar legal tender, but the Constitution contains no limitations on the action of the Feds in that regard. You may argue that was a stupid move economically or abhorrent morally (I agree gold confiscation definitely was), but there's nothing the Constitution can help you with here. And not by omission - there's a big part that contains things that the Congress can't do - just making paper money legal tender is not in the list.

Theyre talking about gold and silver coins, which I would think are still legal tender simply by being dollars, no? A modern US coin could become valuable and trigger the same issue, gold standard or no.

They are legal tender, and if anyone is insane as to pay your taxes in gold dollars by nominal value, I'm sure the IRS would be fine with that. In fact, if you want to do that, I am sure there would be thousands of people who would be willing to facilitate such transaction. I certainly would - not everyday you can make 200x+ immediate profit.

A modern US coin could become valuable and trigger the same issue, gold standard or no.

There are collector coins, for sure. And I am pretty sure if you buy one and sell it at profit, you'd owe income taxes.

I mean... kind of. I'd have to check mine, but 1 oz gold American Eagles I think are still stamped with something preposterous like $25. But obviously nobody would apend them like that.when the melt value is north of $2000. Its an insane fiction kept up since Nixon for reasons I can't fathom.

something preposterous like $25

It's 50 dollars.

The only mention of gold and silver in the Constitution is:

No State shall... make any Thing but gold and silver Coin a Tender in Payment of Debts...

Which plainly doesn't bind the federal government to any particular course of action.

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