Interesting Read on Payments in US Gold Coins – Seems the IRS can’t have its cake & eat it too. 29 - November - 2007Posted by k9zw in The Rambling Series.
Interesting Read on Payments in US Gold Coins
Seems the IRS can’t have its cake & eat it too.
In summary a business has been paying its subcontractors in our modern gold & silver coinage, declaring only the face value for taxation.
This has put a face value of only $2600, or what is below non-tax-reportable levels, on what could be exchanged for $42,000 – if the sub-contractor chooses to sell his gold & silver coinage for paper (read Fiat) Federal Reserve Notes at market.
Seems the Federal Government made a mess of creating the dual money system – the modern silver/gold investment series of coinage remains classified as simple “legal tender” at face value – as it was the same as the Federal Reserve Notes paper money (Fiat notes).
The IRS took this fellow, his business and the sub-contractors to criminal court (guns, chains & jumpsuits – that sort of nonsense) over $114,000,000 in transactions that were paid at face value with the gold-silver coinage at a low rate of payment.
Uncle filed 161 criminal charges and at the end of the trial they scored Zero Convictions. Two defendants were not cleared of small items (will have to read the cases when they are published to understand what level of technical violations were discovered) and several of the charges resulted in “hung jury” which would allow the government to retry those charges without asking the courts permission to file an appeal.
Apparently the magic is if the coinage is modern, carries the US Dollar denomination and “In God We Trust.” Again the reading of the cases when published will provide a better insight. Pre-FDR coinage is, by legislation, clearly not legal tender and would fail this test, as would any non-US gold/silver coinage.
Unexplored in the article is what tax liability is incurred by the subcontractor if they sell some of their “pay” at more than face value?
One article on the cases is at: